What is Sole proprietorship in India?

The sole proprietorship is the oldest, simplest, and most common form of business entity. It is a business owned by a single individual. For tax and legal liability purpose, the owner and the business are one and the same. The proprietorship is not taxed as separate entity. Note that the earnings of the business are taxed at the individual level, whether or not they are actually in cash. There is no vehicle for sheltering income. For liability purposes, the individual and the business are also one and the same. Thus, legal claimants can pursue the personal property of the proprietor and not simply the assets used in the business.

Advantages of a Sole Proprietorship

Perhaps the greatest advantage of this form of business is its simplicity and low cost. You are not required to register with the government, nor are any legal charter required. The sole proprietorship form of business has other advantages:

  • The owner or proprietor is in complete control of business decisions.
  • The income generated through operations can be directed into the proprietor’s pocket or reinvested as he or she sees fit.
  • Profits flow directly to the proprietor’s personal tax return; they are not subject to a second level of taxation. In others words, profits from the business will not be taxed at the business level.
  • The business can be dissolved as easily and informally as it was begun.

These advantages account for the widespread adoption of the sole proprietorship in the India. Any person who wants to set up shop and begin dealing with customers can get right to it, in most cases without the intervention of government bureaucrats or lawyers.

Disadvantages of the Sole Proprietorship

This legal form of organization, however, has disadvantages:

  • The amount of capital available to the business is limited to the owner’s personal funds and whatever funds can be borrowed. This disadvantages limits the potential size of the business, no matter how attractive or popular its product or service
  • Sole proprietors have unlimited liability for all debts and legal judgements incurred in the course of business. Thus, a product liability lawsuit by a customer will not be made against the business but rather against the owner.
  • The business may not be able to attract high-calibre employees whose goals include a share of business ownership. Sharing the benefits of ownership, other than simple profit-sharing, would require a change in the legal form of the business.
  • Some employee benefits, such as owner’s life, disability, and medical insurance premiums, may not be deductible, or may be only partially
    deductible from taxable income.
  • The entity has a limited life; it exists only as long as the owner is alive. Upon the owner’s death, the assets of the business go to his or her estate.

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  • Thanks for the simple explanation of proprietorship. Could also add text or links for the procedure to open a proprietorship – including the complete set of legal documentations required for the business to function?

  • Naval

    Thanks for the simple explanation of proprietorship. Have a small question, can a sole proprietor company can be named with word ” corporation” in it ?

    Pleased to Hear

    Regards

  • Naval

    Thanks for the simple explanation of proprietorship. Have a small question, can a sole proprietor company can be named with word ” corporation” in it ?

    Pleased to Hear

    Regards

  • Yes, You can add “corporation” word into name of a proprietorship. You should not use trade mark of any other company.

    • Bhupinder Sohal

      Hi Mukesh,
      I have got some idea from your blog. However the path is still not clear.

      I want to go for sole proprietorship for a startup. I do not understand the benefit of current a/c, and would not be having too much of money transfers to my a/c. On an average maybe 30 in a month, each will be much lesser than 50K. Will the banks object to such transaction if instead I transact via my savings a/c ?
      What are the requirements to get shop establishment registration. Actually I would be providing services, mostly over internet and clients would visit my office for meetings, that I intend to open in my rented flat in an apartment.
      Should I be going to municipality for getting further details on shop labour registration ?
      I also want to register the logo/brand of my startup. Where can I go for this, and what all things need to be done. Please help.

      • Tanvir Pathan

        Hi Bhupinder,

        I would advice to go for nationalize bank and you don’t need to do logo/brand registration if you are starting new business but still if you want to then you need to do Trademark Registration.

  • Yes, You can add “corporation” word into name of a proprietorship. You should not use trade mark of any other company.

  • Vaishali

    Good explanation. Can a Limited Company registered under The Companies Act be a sole proprietor?

  • Vaishali

    Good explanation. Can a Limited Company registered under The Companies Act be a sole proprietor?

  • Aryaa Dixt

    Hi, I am planning to start my sole proprietorship company. For that I have certain questions which are as follows :-
    1. Can we issue any certificate to the employees on the letterhead of the company?
    2. Can we start an educational training institute and put the same trainees in the business as employees?
    3.Can we bond the employees?
    4.Can we tie-up with other company?
    5.do we have to give wage or salary to the employees? Is that mandatory…??

    Would be great help if you can guide for the above mentioned questions.

    thanks and regards
    Aryaa Dixit

  • Aryaa Dixt

    Hi, I am planning to start my sole proprietorship company. For that I have certain questions which are as follows :-
    1. Can we issue any certificate to the employees on the letterhead of the company?
    2. Can we start an educational training institute and put the same trainees in the business as employees?
    3.Can we bond the employees?
    4.Can we tie-up with other company?
    5.do we have to give wage or salary to the employees? Is that mandatory…??

    Would be great help if you can guide for the above mentioned questions.

    thanks and regards
    Aryaa Dixit

  • In case of sole proprietorship firm you can issue certificate on the letter head of the company.
    Furtehr in proprietorship you can do any business, hire employees on bonds and Tie up with the other company, but employees and other parties have less trust on the sole proprietorship beacsuse it don’t have standard governance and less government control.

  • In case of sole proprietorship firm you can issue certificate on the letter head of the company.
    Furtehr in proprietorship you can do any business, hire employees on bonds and Tie up with the other company, but employees and other parties have less trust on the sole proprietorship beacsuse it don’t have standard governance and less government control.

  • A limited company registered under companies act normally doesn’t act as soleproprietorship but companies can do a seprate business as a divison of the company or known as sole proprietor of that business. This practice is mainly used to start diversifed activities under the same company.

  • A limited company registered under companies act normally doesn’t act as soleproprietorship but companies can do a seprate business as a divison of the company or known as sole proprietor of that business. This practice is mainly used to start diversifed activities under the same company.

  • Vaishali

    Thanks for the reply. appreciate if you could clarify what are the legal procedure for starting a division and closing the same.

  • Vaishali

    Thanks for the reply. appreciate if you could clarify what are the legal procedure for starting a division and closing the same.

  • Company’s board of directors should pass a resolutaion for starting a division of the company and to authorise any person to operate the bank account in the name of division.

  • Company’s board of directors should pass a resolutaion for starting a division of the company and to authorise any person to operate the bank account in the name of division.

  • rajkt1

    Dear Mr. Mukesh,

    I have gone through your suggestions to different people.

    I have following questions:

    1. I was salaried till last Jan’08
    2. I am providing consultancy to software
    company – freelancing work
    3. my monthly income is around 25-40K
    4. I have purchased new car for my routine and business usage which is on finance

    Need to understand:
    1) should i show my income as consulting income as proprietor?
    2) Should i take Depreciation benefits on car ?
    3) do i need to submit tax return quarterly?
    4) How much petrol and other official expenses i can claimed?

    A waiting for your valuable reply.

    Regards,

    Raj

  • rajkt1

    Dear Mr. Mukesh,

    I have gone through your suggestions to different people.

    I have following questions:

    1. I was salaried till last Jan’08
    2. I am providing consultancy to software
    company – freelancing work
    3. my monthly income is around 25-40K
    4. I have purchased new car for my routine and business usage which is on finance

    Need to understand:
    1) should i show my income as consulting income as proprietor?
    2) Should i take Depreciation benefits on car ?
    3) do i need to submit tax return quarterly?
    4) How much petrol and other official expenses i can claimed?

    A waiting for your valuable reply.

    Regards,

    Raj

  • Sachin

    Dear Mukesh,
    First of all thanks for giving us such valuable advices. Now back to my question and situation…

    I am a semi-government employee (in a Municipal Corporation) but want to start up my own company .. some experts told me that i cant because government employees are not authorized to do so while they are in service …is it true ? if its true than can i make my mother the main person behind the company and work in background….plz suggest me what to do in this situation.

    The frame of the company will be based on Sole Proprietorship coz it is most easy for me to implement at present situation…. now suppose that my company name is “SPECTRA” … so on my stamp/invoices/bills that i will use/issue on behalf of my company can i print up –
    SPECTRA INCORPORATION [SPECTRA INC.] or SPECTRA PVT. LTD. or SPECTRA CORPORATION …… PLZ TELL ME ALL THE EXTENSIONS THAT I CAN USE TO END UP THE NAME OF MY COMPANY…..

    second thing is, the company i m willing to start will be providing software development and website designing services to the clients and will be based at lucknow, Uttar Pradesh, so will i have to pay VAT or service tax ?

    FINALLY …what taxes and charges will i have to pay to government to make all the working of my company legal…

    MY MESSAGE IS TOO LONG BUT I THINK THAT MOST OF US ARE WILLING TO KNOW THE SAME ANS. ….PLZ HELP ME OUT, ITS URGENT FOR ME TO TAKE DECISION AS SOON AS POSSIBLE

    THANKS IN ADVANCE !!!

  • Sachin

    Dear Mukesh,
    First of all thanks for giving us such valuable advices. Now back to my question and situation…

    I am a semi-government employee (in a Municipal Corporation) but want to start up my own company .. some experts told me that i cant because government employees are not authorized to do so while they are in service …is it true ? if its true than can i make my mother the main person behind the company and work in background….plz suggest me what to do in this situation.

    The frame of the company will be based on Sole Proprietorship coz it is most easy for me to implement at present situation…. now suppose that my company name is “SPECTRA” … so on my stamp/invoices/bills that i will use/issue on behalf of my company can i print up –
    SPECTRA INCORPORATION [SPECTRA INC.] or SPECTRA PVT. LTD. or SPECTRA CORPORATION …… PLZ TELL ME ALL THE EXTENSIONS THAT I CAN USE TO END UP THE NAME OF MY COMPANY…..

    second thing is, the company i m willing to start will be providing software development and website designing services to the clients and will be based at lucknow, Uttar Pradesh, so will i have to pay VAT or service tax ?

    FINALLY …what taxes and charges will i have to pay to government to make all the working of my company legal…

    MY MESSAGE IS TOO LONG BUT I THINK THAT MOST OF US ARE WILLING TO KNOW THE SAME ANS. ….PLZ HELP ME OUT, ITS URGENT FOR ME TO TAKE DECISION AS SOON AS POSSIBLE

    THANKS IN ADVANCE !!!

  • Gaurav

    We know that the existence of a sole proprietorship business is dependent on the life of the proprietor. Illness, death etc. of the owner brings an end to the business.

    In such a case where A owns a sole proprietorship of a business and in case of his death, how can B who is his family member take over his business and become sole proprietorship…….coz the business is to be continued…

  • Gaurav

    We know that the existence of a sole proprietorship business is dependent on the life of the proprietor. Illness, death etc. of the owner brings an end to the business.

    In such a case where A owns a sole proprietorship of a business and in case of his death, how can B who is his family member take over his business and become sole proprietorship…….coz the business is to be continued…

  • rajkt1

    Your income from freelancing work will be taxable as income from buisness. As in the case of sole proprietorship income is assessed as individual, your income will be taxable as your individual income. Further you can claim all expenses related to the business which are incurred to carry on the business activity.

  • rajkt1

    Your income from freelancing work will be taxable as income from buisness. As in the case of sole proprietorship income is assessed as individual, your income will be taxable as your individual income. Further you can claim all expenses related to the business which are incurred to carry on the business activity.

  • Mr. Gaurav
    In case of death of a sole propritor his buniess can continue as per the sucessation law. States VAT law allow to continue the sole proprietorshuip business to his osn after the death of the proprietor. As per income tax income from sole proprietorship is assessed in the heands of individual.

    • dear sir
      my father owned a business it was a sole proprietor ship firm , my father died on 2nd of august 2009 . we his children want to continue the business . we are 4 (myself , young brother, a young married sister, and younger sister doing her MBA.i used to be the mandate holder , now with his sudden death , we are all confused on how to continue this business, we owe money to our suppliers,and customers also owe us money, how are we going to take control of all that. i consulted the CTO. but he says that the business has to be closed immediately and says that in no way we can continue the business in the same NAME , he asks us to surrender the firm , but to other questions i asked as the above he says he has no knowledge . we do not want to surender the company if we can . we want to continue it . please help us ? if we can continue the company with out surrender and closure how do we do it ? my brother and sisters and my mother will give no objection letter, and if i have to close the company as no other way. then how do i get my suppliers paid for what they have supplied and how will i get money from customers we have supplied ?
      please help
      i anticipate your reply

  • Mr. Gaurav
    In case of death of a sole propritor his buniess can continue as per the sucessation law. States VAT law allow to continue the sole proprietorshuip business to his osn after the death of the proprietor. As per income tax income from sole proprietorship is assessed in the heands of individual.

    • dear sir
      my father owned a business it was a sole proprietor ship firm , my father died on 2nd of august 2009 . we his children want to continue the business . we are 4 (myself , young brother, a young married sister, and younger sister doing her MBA.i used to be the mandate holder , now with his sudden death , we are all confused on how to continue this business, we owe money to our suppliers,and customers also owe us money, how are we going to take control of all that. i consulted the CTO. but he says that the business has to be closed immediately and says that in no way we can continue the business in the same NAME , he asks us to surrender the firm , but to other questions i asked as the above he says he has no knowledge . we do not want to surender the company if we can . we want to continue it . please help us ? if we can continue the company with out surrender and closure how do we do it ? my brother and sisters and my mother will give no objection letter, and if i have to close the company as no other way. then how do i get my suppliers paid for what they have supplied and how will i get money from customers we have supplied ?
      please help
      i anticipate your reply

  • Mr. Sachin
    Being a governement servant you can’t do your own business. You can do the business in your mother’s name. You can’t use the world private limited or Limited as only registerd company can use these word. Any other name which is not a trade mark of any other person can be used as the name of the firm.

  • Mr. Sachin
    Being a governement servant you can’t do your own business. You can do the business in your mother’s name. You can’t use the world private limited or Limited as only registerd company can use these word. Any other name which is not a trade mark of any other person can be used as the name of the firm.

  • VASU JAIN

    how and where should i register , if i want to start interior designing business

  • VASU JAIN

    how and where should i register , if i want to start interior designing business

  • sachin

    Thanks Mukesh.

    But plz tell me this also…

    The company i m willing to start will be providing software development and website designing services to the clients and will be based at lucknow, Uttar Pradesh, so will i have to pay VAT or service tax ..or any pther tax?

    FINALLY …what taxes and charges will i have to pay to government to make all the working of my company legal…

    will i have to file return on the behalf of my company every year …even if it is not doing business at that level or limit.
    What is the limit decided, after which one has to pay tax to government.

    I will be grateful to you for your help.
    THANKS

  • sachin

    Thanks Mukesh.

    But plz tell me this also…

    The company i m willing to start will be providing software development and website designing services to the clients and will be based at lucknow, Uttar Pradesh, so will i have to pay VAT or service tax ..or any pther tax?

    FINALLY …what taxes and charges will i have to pay to government to make all the working of my company legal…

    will i have to file return on the behalf of my company every year …even if it is not doing business at that level or limit.
    What is the limit decided, after which one has to pay tax to government.

    I will be grateful to you for your help.
    THANKS

  • Madhav

    What are the advantages of forming a private company in comparision to sole propritorship in India.

  • Madhav

    What are the advantages of forming a private company in comparision to sole propritorship in India.

  • Mr. Madhav,

    The first important deiffence is the difference of liability. In sole properietorship your personal assets are also laible for discharge of a liability while in case of private limited company, you as a shareholder liable only unpaid amount of the shares paid up value.
    Second one is a private imited company is unique registered name, means no two companies can register with the similer name but you can do any number of proprietorship busines with the same name.

  • Mr. Madhav,

    The first important deiffence is the difference of liability. In sole properietorship your personal assets are also laible for discharge of a liability while in case of private limited company, you as a shareholder liable only unpaid amount of the shares paid up value.
    Second one is a private imited company is unique registered name, means no two companies can register with the similer name but you can do any number of proprietorship busines with the same name.

  • Vashu Jain

    If you are a service provcider and your receipts are less than Rs.10 lacs then no need for any registration, just open a current bank account and get started. But if your turnover exceeds 10 lacs per annum then gor for VAT/Services tax registraion also.

  • Vashu Jain

    If you are a service provcider and your receipts are less than Rs.10 lacs then no need for any registration, just open a current bank account and get started. But if your turnover exceeds 10 lacs per annum then gor for VAT/Services tax registraion also.

  • CHANDRA DEO PRASAD

    PLZ TELL THE REGISTRATION PROCESS OF SOLE PROPRIETOR SHIP BUSINESS

  • CHANDRA DEO PRASAD

    PLZ TELL THE REGISTRATION PROCESS OF SOLE PROPRIETOR SHIP BUSINESS

  • V.Ramesh

    Hi Sir

    Your answers are very much useful. I AM NRIAND WANT TO HAV OWN COMPANY AS PROPIRATORISHIO FRIM. PLS. ADVICE THE FORMALITIES

  • V.Ramesh

    Hi Sir

    Your answers are very much useful. I AM NRIAND WANT TO HAV OWN COMPANY AS PROPIRATORISHIO FRIM. PLS. ADVICE THE FORMALITIES

  • Tarun Bhatnagar

    Dear Sir,
    I am Tarun Bhatnagar, The company i m willing to start will be providing software development and website designing services to the clients and will be based in Ghaziabad, Uttar Pradesh, so will i have to pay VAT or service tax ..or any pther tax?

    What are the formalities to register it, I have two partners with me.
    FINALLY …what taxes and charges will i have to pay to government to make all the working of my company legal…
    will i have to file return on the behalf of my company every year …even if it is not doing business at that level or limit.
    What is the limit decided, after which one has to pay tax to government.
    Kindly reply me on my email Id : tbhatnagar@in.com
    tarun_bhatnagar_proff@yahoo.co.in, or call me 09990378784
    I will be grateful to you for your help.
    THANKS

  • Tarun Bhatnagar

    Dear Sir,
    I am Tarun Bhatnagar, The company i m willing to start will be providing software development and website designing services to the clients and will be based in Ghaziabad, Uttar Pradesh, so will i have to pay VAT or service tax ..or any pther tax?

    What are the formalities to register it, I have two partners with me.
    FINALLY …what taxes and charges will i have to pay to government to make all the working of my company legal…
    will i have to file return on the behalf of my company every year …even if it is not doing business at that level or limit.
    What is the limit decided, after which one has to pay tax to government.
    Kindly reply me on my email Id : tbhatnagar@in.com
    tarun_bhatnagar_proff@yahoo.co.in, or call me 09990378784
    I will be grateful to you for your help.
    THANKS

  • Mr. Tarun,

    Software development and Web site designing is taxable under the service tax. But in the very first year upto Rs.10 lakh you can sell without service tax, once you cross the turnover first time then you are liable for service tax. But you can pay the service tax from day one also without claiming exemption of Rs.10 lakh.

  • Mr. Tarun,

    Software development and Web site designing is taxable under the service tax. But in the very first year upto Rs.10 lakh you can sell without service tax, once you cross the turnover first time then you are liable for service tax. But you can pay the service tax from day one also without claiming exemption of Rs.10 lakh.

  • Mr. V. Ramesh,

    As an NRI ith will be difficult to run a sole proprietor firm. It will be better to incorporate a private limited company.

  • Mr. V. Ramesh,

    As an NRI ith will be difficult to run a sole proprietor firm. It will be better to incorporate a private limited company.

  • Vikram

    Hi,

    I am planning a group of propreitorship companies, is it possible for me to club them under a common service tax registration e.g vikram abc and vikram xyz – service tax: xxxxxxxxST001 common for both?

  • Vikram

    Hi,

    I am planning a group of propreitorship companies, is it possible for me to club them under a common service tax registration e.g vikram abc and vikram xyz – service tax: xxxxxxxxST001 common for both?

  • hi, I wish to start a proprietorship firm, and I understand that there is no registration required anywhere. My turnover will be less than 10 lacs a year so that will nto attract service tax either. But I do wish to know what is the best way to open a bank account in the name of the proprietorship firm. Banks are asking for some document from the government, and so when I considered doing a service tax registration they are asking me for things like municipal registration and stuff. I wish to do business from my home and I do not want to do any sort of registration with the municipality in my home address.

    Would be glad if you could help me with this.

  • hi, I wish to start a proprietorship firm, and I understand that there is no registration required anywhere. My turnover will be less than 10 lacs a year so that will nto attract service tax either. But I do wish to know what is the best way to open a bank account in the name of the proprietorship firm. Banks are asking for some document from the government, and so when I considered doing a service tax registration they are asking me for things like municipal registration and stuff. I wish to do business from my home and I do not want to do any sort of registration with the municipality in my home address.

    Would be glad if you could help me with this.

  • Doraiswamy R

    Very usefull information. Thanks very much

  • Doraiswamy R

    Very usefull information. Thanks very much

  • sevanth

    HI,

    can you guide me with the procedure to start a business under sole proprietorship?

  • sevanth

    HI,

    can you guide me with the procedure to start a business under sole proprietorship?

  • Mr. Ravi,

    Yes, this is problem that some bank ask for the proof of the firm to open a current account of a sole proprietorship firm. But you can take a certificate from a charterd accountnat and most of the bank on the basis of the CA certificate open a current account. Further if run a business from a home, normally there is no problem but it depends upon the nature of business and loaction.

  • Mr. Ravi,

    Yes, this is problem that some bank ask for the proof of the firm to open a current account of a sole proprietorship firm. But you can take a certificate from a charterd accountnat and most of the bank on the basis of the CA certificate open a current account. Further if run a business from a home, normally there is no problem but it depends upon the nature of business and loaction.

  • Mr. Vikram,
    Service tax registration is now PAN based, so in case of sole proprietorship you have only one PAN for all companies. If you want to provide difeerent services under one registration then you can do that. Normally service tax registration is prmises based and if you are providing all services from one premises then you can obtain the single registration foe all services.

  • Mr. Vikram,
    Service tax registration is now PAN based, so in case of sole proprietorship you have only one PAN for all companies. If you want to provide difeerent services under one registration then you can do that. Normally service tax registration is prmises based and if you are providing all services from one premises then you can obtain the single registration foe all services.

  • Pradeep

    Hi Mukesh,

    I have been going through your blog about starting a “sole proprietorship” firm in India.
    Your replies are really informative.

    I am planning to start one “sole proprietorship” software service firm with one employee in India. If the bank doesn’t agree to open a current account without any registration.
    Do you provide the above said “certificate from CA” to open an account ?

    I will have client only from USA and will get the payment through “Wire Transfer” from USA bank to the bank a/c in India.
    At this point I don’t think I will have earnings above 10l per year. I may close the same without even making single penny … 🙂

    So my doubt is since the client is only from USA,
    is there any registration or tax filing I’ve to do
    specifically other than starting the bank a/c in
    India ?

    Thank you for any help in this matter in advance.

  • Pradeep

    Hi Mukesh,

    I have been going through your blog about starting a “sole proprietorship” firm in India.
    Your replies are really informative.

    I am planning to start one “sole proprietorship” software service firm with one employee in India. If the bank doesn’t agree to open a current account without any registration.
    Do you provide the above said “certificate from CA” to open an account ?

    I will have client only from USA and will get the payment through “Wire Transfer” from USA bank to the bank a/c in India.
    At this point I don’t think I will have earnings above 10l per year. I may close the same without even making single penny … 🙂

    So my doubt is since the client is only from USA,
    is there any registration or tax filing I’ve to do
    specifically other than starting the bank a/c in
    India ?

    Thank you for any help in this matter in advance.

  • bharat

    hi Mukesh,

    glad to read your comments & data on sole proprietorship. My father had a sole prop company which dealt in import & export. He passed away suddenly leaving below questions for me … i will appreciate yr views / comments :

    * can Bank account where i am power of attorney holder be transferred in my name ?

    * banks insist to freeze / close account but we are yet to recv various foreign payments and draw back from govt which will take time. so what shud be recourse to continue the same account ?

    * can IMPORT EXPORT CODE NO can be changed / replace my name ?

    * Is there any way proprietor co can be taken over with all its assets / liabilities ?

    * is Bank ‘s view to close / freeze account is right ?

    pls advice on above asap.

    bharat

  • bharat

    hi Mukesh,

    glad to read your comments & data on sole proprietorship. My father had a sole prop company which dealt in import & export. He passed away suddenly leaving below questions for me … i will appreciate yr views / comments :

    * can Bank account where i am power of attorney holder be transferred in my name ?

    * banks insist to freeze / close account but we are yet to recv various foreign payments and draw back from govt which will take time. so what shud be recourse to continue the same account ?

    * can IMPORT EXPORT CODE NO can be changed / replace my name ?

    * Is there any way proprietor co can be taken over with all its assets / liabilities ?

    * is Bank ‘s view to close / freeze account is right ?

    pls advice on above asap.

    bharat

  • Bharat,

    If a sole proprietior died without a will (wasiat) then all his legal heir will be the owner of that proprietorship. But if you get the No objection from all other legal heir of your father and take a sucession certificate from the court (Which takes 4-5 months) then bank as well as other authorities allow you to continue the same business. Otherwise you can create a new firm with the same name but now you will be the sole proprietor of that firm and all future business will be done through this firm and only old realisation and laibility will be discharged from old firm’s bank account and you have to obtain a fresh IEC and other registration.

  • Bharat,

    If a sole proprietior died without a will (wasiat) then all his legal heir will be the owner of that proprietorship. But if you get the No objection from all other legal heir of your father and take a sucession certificate from the court (Which takes 4-5 months) then bank as well as other authorities allow you to continue the same business. Otherwise you can create a new firm with the same name but now you will be the sole proprietor of that firm and all future business will be done through this firm and only old realisation and laibility will be discharged from old firm’s bank account and you have to obtain a fresh IEC and other registration.

  • bharat

    tks for yr guidance.

    i am concerned about our companies past dues from abroad and drawback to be recd from customs & excise.

    Bank insist on closing of account and not allowing any transactions.

    In this case, how can i protect my incoming funds ? Is there any laws which allow me to run account for few months till all old transcations are over ?

    I am only legal heir and business & other assets are in my favour as per WILL of my father. Does that help in convincing banker to allow to run account for few months till all old transactions are over ?

    tks u very much for yr comment.

  • bharat

    tks for yr guidance.

    i am concerned about our companies past dues from abroad and drawback to be recd from customs & excise.

    Bank insist on closing of account and not allowing any transactions.

    In this case, how can i protect my incoming funds ? Is there any laws which allow me to run account for few months till all old transcations are over ?

    I am only legal heir and business & other assets are in my favour as per WILL of my father. Does that help in convincing banker to allow to run account for few months till all old transactions are over ?

    tks u very much for yr comment.

  • Farhat Parveen

    Dear Mr. Mukesh, I didnt find any link on your website to ask my questions to you. Hence, sending like this.

    I just wanted to know that, in current scenario of share market clash, would you recommend me to start my own recruitment consultancy company (Under sole proprietorship)? Please advice, I will be very thankful. I was planning and doing R&D to start the same since, last 4-5 months.

    Thanks

    Farhat Parveen

  • Farhat Parveen

    Dear Mr. Mukesh, I didnt find any link on your website to ask my questions to you. Hence, sending like this.

    I just wanted to know that, in current scenario of share market clash, would you recommend me to start my own recruitment consultancy company (Under sole proprietorship)? Please advice, I will be very thankful. I was planning and doing R&D to start the same since, last 4-5 months.

    Thanks

    Farhat Parveen

  • Farhat Praveen

    I think currently market is unstable and slow for the time being in india also. So please wait for 2-3 month and then start your business because in the intial period if will not get the good business then you will not sustain.

  • Farhat Praveen

    I think currently market is unstable and slow for the time being in india also. So please wait for 2-3 month and then start your business because in the intial period if will not get the good business then you will not sustain.

  • Kalpit Lodha

    Hello,
    I have a doubt, whether a company enter into sole proprietorship. Please through some light on this isue.

    Best regards
    Kalpit

  • Kalpit Lodha

    Hello,
    I have a doubt, whether a company enter into sole proprietorship. Please through some light on this isue.

    Best regards
    Kalpit

  • A limited/private limited company registered under companies act normally doesn’t act as soleproprietorship but companies can do a seprate business as a divison of the company or known as sole proprietor of that business. This practice is mainly used to start diversifed activities under the same company.

  • A limited/private limited company registered under companies act normally doesn’t act as soleproprietorship but companies can do a seprate business as a divison of the company or known as sole proprietor of that business. This practice is mainly used to start diversifed activities under the same company.

  • Jayant

    I am technical advisor & have proprietory consultancy firm.
    Can I go for a private ltd. company? Which is better potion?

  • Jayant

    I am technical advisor & have proprietory consultancy firm.
    Can I go for a private ltd. company? Which is better potion?

  • Mr. Jayant,

    If your business is well sattled and you have team to grow then only go for a private limited company. Because in private limited company there are verious formalities and begainers may loose their attention from business to these formalities and financial problems also.

  • Mr. Jayant,

    If your business is well sattled and you have team to grow then only go for a private limited company. Because in private limited company there are verious formalities and begainers may loose their attention from business to these formalities and financial problems also.

  • rayoz

    I am willing to open a private limited company but could find the meaning of “authorized capital of Rs 1 lac.”

    When do i need to deposit it and where in which mode? Also can i use this money after company formation?

    A detailed reply will be greatly appreciated

  • rayoz

    I am willing to open a private limited company but could find the meaning of “authorized capital of Rs 1 lac.”

    When do i need to deposit it and where in which mode? Also can i use this money after company formation?

    A detailed reply will be greatly appreciated

  • Jayant

    Mr. Mukesh

    Thank you

  • Jayant

    Mr. Mukesh

    Thank you

  • mkaifi

    Hi,

    I want to start an investment company (sole proprietorship). Do I have to obtain any license to do that? Also, can the losses incurred be used to offset the tax liability from the salary of my day job.

    Regards

    Kaifi

  • mkaifi

    Hi,

    I want to start an investment company (sole proprietorship). Do I have to obtain any license to do that? Also, can the losses incurred be used to offset the tax liability from the salary of my day job.

    Regards

    Kaifi

  • Jo

    Mr. Mukesh,

    I have started a Manpower Agency in Karnataka and it has been registered there as i am charging service tax. I want to open few branches in states like kerala and Tamilnadu. SO do I required to register again in the above states too to work in that region.

    Jo Jose

  • Jo

    Mr. Mukesh,

    I have started a Manpower Agency in Karnataka and it has been registered there as i am charging service tax. I want to open few branches in states like kerala and Tamilnadu. SO do I required to register again in the above states too to work in that region.

    Jo Jose

  • Service tax registration is required for every office or business location. Therse is an option that you can go for a centralise registration for all prmises from your current head office in that case you have to modify your current registration and add your branches with the same registration.

  • Service tax registration is required for every office or business location. Therse is an option that you can go for a centralise registration for all prmises from your current head office in that case you have to modify your current registration and add your branches with the same registration.

  • karan

    Dear sir

    I am interested in starting a news paper on sole proprietorship basis. so help me to understand the steps involved in.

  • karan

    Dear sir

    I am interested in starting a news paper on sole proprietorship basis. so help me to understand the steps involved in.

  • manoj

    Hi Mukesh,

    I want to start a sole proprietorship firm in Bangalore. Could you please guide me through the process in brief?
    Your help is highly appreciated.

    Thank you,
    Manoj

  • manoj

    Hi Mukesh,

    I want to start a sole proprietorship firm in Bangalore. Could you please guide me through the process in brief?
    Your help is highly appreciated.

    Thank you,
    Manoj

  • Masud

    Hi Mr. Mukesh

    I got the trade license from the Municipality for my sole propritorship business which deals with Education Consultancy. My client will be UK universities and I will represent their universities to Indian students.
    I would be highly thankful if you could suggest me that do I need to registered the company’s name, or else I with trade license I can start working.

    With Regards
    Masud

  • Masud

    Hi Mr. Mukesh

    I got the trade license from the Municipality for my sole propritorship business which deals with Education Consultancy. My client will be UK universities and I will represent their universities to Indian students.
    I would be highly thankful if you could suggest me that do I need to registered the company’s name, or else I with trade license I can start working.

    With Regards
    Masud

  • Ganesh singh

    Thanks for a fruitful and educating Material .

    I want to start my proprietorship company for the purpose of Trading initially and wants to go in for manufacturing latter.

    Kindly guide me can I start proprietership company from my residence address and with the same A/C I have . Also Please guide me where and whom to approach for the Leagal documentation for the same . I am living in Sahibabad ( Gzb.)
    Thanking You,
    Ganesh Singh
    9873627768

  • Ganesh singh

    Thanks for a fruitful and educating Material .

    I want to start my proprietorship company for the purpose of Trading initially and wants to go in for manufacturing latter.

    Kindly guide me can I start proprietership company from my residence address and with the same A/C I have . Also Please guide me where and whom to approach for the Leagal documentation for the same . I am living in Sahibabad ( Gzb.)
    Thanking You,
    Ganesh Singh
    9873627768

  • Deepak bhati

    hi,
    i want to start up a sole prop event management co. in bangalore.
    i have already booked the artist and auditorium.
    kindly, guide me where and how to register.
    and what are all the necessities if i start the business??? do help me as soon as possible plz.

  • Deepak bhati

    hi,
    i want to start up a sole prop event management co. in bangalore.
    i have already booked the artist and auditorium.
    kindly, guide me where and how to register.
    and what are all the necessities if i start the business??? do help me as soon as possible plz.

  • hifza

    thanks for such an easy explanation …….

  • hifza

    thanks for such an easy explanation …….

  • hifza

    this explanation has helped me alotttttttttt to clear my concept.

  • hifza

    this explanation has helped me alotttttttttt to clear my concept.

  • Deepti

    hi Mukesh,

    Firstly, Thank you so much for all you replies & this post.

    I have a quick question for you, I provide software services from home & have a firm registered at home address. I got the IEC code last week & now planning to get a STPI registration. so please let me know if I can get the same without opening a office?

    Thanks in advance!!

  • Deepti

    hi Mukesh,

    Firstly, Thank you so much for all you replies & this post.

    I have a quick question for you, I provide software services from home & have a firm registered at home address. I got the IEC code last week & now planning to get a STPI registration. so please let me know if I can get the same without opening a office?

    Thanks in advance!!

  • Dear Mr.Mukesh,

    I am the sole proprietor of an export company. My husband is a foreigner of Indian origin and the company has been set up in my name to simplify matters.

    The company has been in existence for about 7 years.
    Is it now possible for me to hand over the company, its assets/liabilities to my husband and thereby remove myself as sole proprietor.

    Thanks in advance.

    Sara

  • Dear Mr.Mukesh,

    I am the sole proprietor of an export company. My husband is a foreigner of Indian origin and the company has been set up in my name to simplify matters.

    The company has been in existence for about 7 years.
    Is it now possible for me to hand over the company, its assets/liabilities to my husband and thereby remove myself as sole proprietor.

    Thanks in advance.

    Sara

  • shikha

    Hi Mukesh,
    Iam lanning to start my consultancy as a sole proprietor . Please let me know how can i register my concern with government of India and also how to go about getting a trademark registered.

  • shikha

    Hi Mukesh,
    Iam lanning to start my consultancy as a sole proprietor . Please let me know how can i register my concern with government of India and also how to go about getting a trademark registered.

  • shikha

    Hi Mukesh,
    Iam planning to start my consultancy as a sole proprietor . Please let me know how can i register my concern with government of India and also how to go about getting a trademark registered.

  • shikha

    Hi Mukesh,
    Iam planning to start my consultancy as a sole proprietor . Please let me know how can i register my concern with government of India and also how to go about getting a trademark registered.

  • Sumit

    Dear,

    i want to know i hane my service tax no last year my turnover was above 10 lacs and i ahve paid service tax on that but this year my turnover is less than 10 lacs till date is around 5lacs and i want to close my company also pls suggest am i liable to pay service tax this year and how can i surrender my service tax no.

    Regards

  • Sumit

    Dear,

    i want to know i hane my service tax no last year my turnover was above 10 lacs and i ahve paid service tax on that but this year my turnover is less than 10 lacs till date is around 5lacs and i want to close my company also pls suggest am i liable to pay service tax this year and how can i surrender my service tax no.

    Regards

  • Paritosh

    Hi Mr Mukesh,

    Is there any way I can get the data of all the sole proprietorship and partnership companies in India or in a particular state. Is there any agency which maintains this kind of data. I m an entrepreneur and looking forward to develop a database of Indian companies.

  • Paritosh

    Hi Mr Mukesh,

    Is there any way I can get the data of all the sole proprietorship and partnership companies in India or in a particular state. Is there any agency which maintains this kind of data. I m an entrepreneur and looking forward to develop a database of Indian companies.

  • Alok

    Hi Mukesh,

    Thanks for maintaining this blog and your responses to visitor’s questions are very informative.

    I am a salaried employee in a Pvt. Ltd. Software firm – and so drawing salary from them – and they are deducting TDS on this salary income.

    On a part-time basis I am also running a propritorship recruitment firm – where I have one employee – I pay salary to him (Rs. 15K/month) through revenue generated from this business, or from my salary account (depending on the cash flows)

    I need your guidance on the following:

    1. Do I have to mandatorily give Form 16 to the employee of my proprietorship for him to file his returns? If yes, how can I create that for him?

    2. Which ITR form do I have to use to file my personal tax returns (for income from salary as well as propritorship + some capital gains from investments)?

    3. Do I have to mandatorily get my business income/loss audited by a external Chartered Accountant?

    4. Can i club loss from my business with the my salary income and pay tax only on the remaining? Or these 2 incomes/loss will be treated seperately?

    Thanks
    Alok

  • Alok

    Hi Mukesh,

    Thanks for maintaining this blog and your responses to visitor’s questions are very informative.

    I am a salaried employee in a Pvt. Ltd. Software firm – and so drawing salary from them – and they are deducting TDS on this salary income.

    On a part-time basis I am also running a propritorship recruitment firm – where I have one employee – I pay salary to him (Rs. 15K/month) through revenue generated from this business, or from my salary account (depending on the cash flows)

    I need your guidance on the following:

    1. Do I have to mandatorily give Form 16 to the employee of my proprietorship for him to file his returns? If yes, how can I create that for him?

    2. Which ITR form do I have to use to file my personal tax returns (for income from salary as well as propritorship + some capital gains from investments)?

    3. Do I have to mandatorily get my business income/loss audited by a external Chartered Accountant?

    4. Can i club loss from my business with the my salary income and pay tax only on the remaining? Or these 2 incomes/loss will be treated seperately?

    Thanks
    Alok

  • I want to start a company from my home, as a sole prop. How do i register it ? If at all needed. My turnover will be less than 2 lac per annum.

  • I want to start a company from my home, as a sole prop. How do i register it ? If at all needed. My turnover will be less than 2 lac per annum.

  • Dear Mr Mukesh,

    I am really glad i landed on this page through google search. Thanks very much for this great post and your consistent replies to queries by people in need.

    I would love to know if there is an official channel or resource on the web where these things pertaining to businesses in India can be clarified. So far I have had no luck on search engines looking for such resources while I notice that such things are very well documented in the US. I hope things get better soon.

    Thanks again for the great work you’ve done here. Greatly appreciated.

    Warmest regards
    Kamal

  • Dear Mr Mukesh,

    I am really glad i landed on this page through google search. Thanks very much for this great post and your consistent replies to queries by people in need.

    I would love to know if there is an official channel or resource on the web where these things pertaining to businesses in India can be clarified. So far I have had no luck on search engines looking for such resources while I notice that such things are very well documented in the US. I hope things get better soon.

    Thanks again for the great work you’ve done here. Greatly appreciated.

    Warmest regards
    Kamal

  • Hakim

    Dear Mr.Mukesh,

    Thanks for a giving insight into Sole proprietorship.

    I have started a software firm in pune.The client company can’t pay on my personal name but on my company’s name.They want me to include in their Vendors list.

    Do i have to obtain a shopact license?

    Will just CA approval letter suffice to obtain Bank Account?

    Is it necessary to obtain Service Tax registration to get to their vendors list even if revenues will be less than 10l Rs?

    I’ll really appreciate your advice and suggestions?

    Thanks
    Hakim

  • Hakim

    Dear Mr.Mukesh,

    Thanks for a giving insight into Sole proprietorship.

    I have started a software firm in pune.The client company can’t pay on my personal name but on my company’s name.They want me to include in their Vendors list.

    Do i have to obtain a shopact license?

    Will just CA approval letter suffice to obtain Bank Account?

    Is it necessary to obtain Service Tax registration to get to their vendors list even if revenues will be less than 10l Rs?

    I’ll really appreciate your advice and suggestions?

    Thanks
    Hakim

  • Chandan Varma

    Hi,
    Can I enter in a contract with a foreign company by having a sole propritorship firm.
    How will I be taxed in that case.

    Regards,
    Chandan

  • Chandan Varma

    Hi,
    Can I enter in a contract with a foreign company by having a sole propritorship firm.
    How will I be taxed in that case.

    Regards,
    Chandan

  • chetanya thakur

    hello sir
    i want to open a Event Management service and a career counselling counsultancy please guide me with your precious advice…

  • chetanya thakur

    hello sir
    i want to open a Event Management service and a career counselling counsultancy please guide me with your precious advice…

  • I have just started my business of Trophies and Corporate Gifts and very grateful to this website for providing me such knowledge. Thanks to the author and participating Member.

  • I have just started my business of Trophies and Corporate Gifts and very grateful to this website for providing me such knowledge. Thanks to the author and participating Member.

  • One question I want to ask here, I want to get a TIN Number, how can I get it.

  • One question I want to ask here, I want to get a TIN Number, how can I get it.

  • ASESH CHATTERJEE

    Kindly let me have the below noted infomation
    (1) I have just retired as General Manager,District Industries Centre.
    (2) Have qualification of M Sc , M BA ,CS
    (3) Have started a SOLE PROPRITORSHIP enterprise providing motivation & EDP training to M&SSE’s about 79 unit on a regular basis against fees
    (4) I also conduct various trainings of GOI Institutes / govt of westbengal off loaded to my enterprise very frequently
    Have a trade licence & P Tax licence
    Do I require to obtain any other licences & or permissions to run this enterprise ??????????

  • ASESH CHATTERJEE

    Kindly let me have the below noted infomation
    (1) I have just retired as General Manager,District Industries Centre.
    (2) Have qualification of M Sc , M BA ,CS
    (3) Have started a SOLE PROPRITORSHIP enterprise providing motivation & EDP training to M&SSE’s about 79 unit on a regular basis against fees
    (4) I also conduct various trainings of GOI Institutes / govt of westbengal off loaded to my enterprise very frequently
    Have a trade licence & P Tax licence
    Do I require to obtain any other licences & or permissions to run this enterprise ??????????

  • Vicky

    Can I get a digital signature in the name of my sole propreitorship firm which I need for code signing my software?

    Thanks.

  • Vicky

    Can I get a digital signature in the name of my sole propreitorship firm which I need for code signing my software?

    Thanks.

  • raj

    can u inform me .
    this is observed for proprietorship company
    1) ISO Registration
    2) Indian Chamber of Commerce.
    3) 100% EOU
    4) TAN or PAN
    5) PF,P.TAX,
    6) ROC

  • raj

    can u inform me .
    this is observed for proprietorship company
    1) ISO Registration
    2) Indian Chamber of Commerce.
    3) 100% EOU
    4) TAN or PAN
    5) PF,P.TAX,
    6) ROC

  • H.HUSSAIN

    SIR, I WOULD LIKE TO KNOW AS TO WHAT IS THE PROCEDURE FOR SETTING UP A SOLE PROPRIETORSHIP CONCERN IN INDIA BY A FOREIGNER. PLEASE LET ME KNOW THE PERMISSIONS REQUIRED BY A FOREIGNER AND FORMS INVOLVED. THANKS

    • A foreign citizen can not do sole proprietorship business in India. He can do business through partnership and Private limited company.

  • H.HUSSAIN

    SIR, I WOULD LIKE TO KNOW AS TO WHAT IS THE PROCEDURE FOR SETTING UP A SOLE PROPRIETORSHIP CONCERN IN INDIA BY A FOREIGNER. PLEASE LET ME KNOW THE PERMISSIONS REQUIRED BY A FOREIGNER AND FORMS INVOLVED. THANKS

    • A foreign citizen can not do sole proprietorship business in India. He can do business through partnership and Private limited company.

  • Ashish

    Hello Mukesh ji,
    I am in a little bigger issue, I live in USA but last month my father passed away leaving his business (sole proprietorship) which I decided to continue by appointing some guys who would run it on my behalf.
    1) Can I use the same Service Tax number, Sales Tax number, VAT numbers which were issued to my late father? The business turn over is around 20 lacs per annum.
    2) I was able to open new bank accounts but could not get his business license transfer as he did not leave any will? This is Electrical Contractors license? Any ideas/ suggestions as how can I get them transferred?

    I am his only legal heir and have NOC from my younger married sister to support my claim?

    Thanks in advance.

    Ashish

  • Ashish

    Hello Mukesh ji,
    I am in a little bigger issue, I live in USA but last month my father passed away leaving his business (sole proprietorship) which I decided to continue by appointing some guys who would run it on my behalf.
    1) Can I use the same Service Tax number, Sales Tax number, VAT numbers which were issued to my late father? The business turn over is around 20 lacs per annum.
    2) I was able to open new bank accounts but could not get his business license transfer as he did not leave any will? This is Electrical Contractors license? Any ideas/ suggestions as how can I get them transferred?

    I am his only legal heir and have NOC from my younger married sister to support my claim?

    Thanks in advance.

    Ashish

  • Pooja

    Hi Mukesh,

    I am thinking of starting a sole proprietorship company in next 2 months time. I have been talking to lot of ppl but still confused. I got to know that without even registering the compnay you can obtain the TIN number. Is it possible? Do I need business license to do the same?

    Regards
    pooja

  • Pooja

    Hi Mukesh,

    I am thinking of starting a sole proprietorship company in next 2 months time. I have been talking to lot of ppl but still confused. I got to know that without even registering the compnay you can obtain the TIN number. Is it possible? Do I need business license to do the same?

    Regards
    pooja

  • i c roberts

    i want to transfer my proprietorship company standing in my name to my nephew. what is the procedure for this.
    Thanks.

  • i c roberts

    i want to transfer my proprietorship company standing in my name to my nephew. what is the procedure for this.
    Thanks.

  • i c roberts

    what is the procedure to transfer my proprietorship company to my nephew’s name? Or how do i wind up the company simple.
    I am in bangalore, Karntaka. Thanks.

  • i c roberts

    what is the procedure to transfer my proprietorship company to my nephew’s name? Or how do i wind up the company simple.
    I am in bangalore, Karntaka. Thanks.

  • Abhi

    Hello Mr. Mukesh,

    Firstly, I would like to congratulate you for the help you are extending to commoners like myself by explaining these arcane legalities using simple language. Your blog is a great support!

    In your posts above, I have found answers to a lot of my questions, but there are a few specific questions where your guidance could be of great help.

    I am a software professional working out of Karnataka, India. I am planning to setup my own sole proprietorship. This is how I envisage to run it:
    – only EXPORT software services to customers outside of India.
    – raise invoices to customers in USD, and remit USD in INR here.
    – the INR value of the invoice generated annually would, in all likelihood, exceed 10,00,000 INR (10 lacs).

    Given this setup, I seek your advice for the following :
    1. As sole proprietorship, do I need to register this entity with the Karnataka State Government, under the Karnataka Shops
    and Commercial Establishments Act?
    2. Do I need to pay the Professional Tax to the Karnataka Government before I start working? If yes, then do I need to register the entity with some Professional Tax department, if there is any? Is there any exemption clause to Professional Tax?
    3. Since my professional services would be exported to clients outside of India, these would not qualify for Service Tax. However, do I still need to register with the Service Tax department?
    4. Since the earnings out of this properietorship would be in USD, am I legally obliged to get an Import Export Code for myself? If so, could you please point me to a resource on the Internet where I could get details of IEC and the procedure to get it?
    5. Given the broad expectations from the company, any other legal formality that I must fulfill per Indian and Karnataka State law before I could start this properteriorship?

    I would greatly appreciate your guidance in this matter.

    Thanks and regards,
    Abhi

    • Trademesoft

      Me too Same question Please reply for the Above Request.
      Thank you
      Umesh A Suvarna

  • Abhi

    Hello Mr. Mukesh,

    Firstly, I would like to congratulate you for the help you are extending to commoners like myself by explaining these arcane legalities using simple language. Your blog is a great support!

    In your posts above, I have found answers to a lot of my questions, but there are a few specific questions where your guidance could be of great help.

    I am a software professional working out of Karnataka, India. I am planning to setup my own sole proprietorship. This is how I envisage to run it:
    – only EXPORT software services to customers outside of India.
    – raise invoices to customers in USD, and remit USD in INR here.
    – the INR value of the invoice generated annually would, in all likelihood, exceed 10,00,000 INR (10 lacs).

    Given this setup, I seek your advice for the following :
    1. As sole proprietorship, do I need to register this entity with the Karnataka State Government, under the Karnataka Shops
    and Commercial Establishments Act?
    2. Do I need to pay the Professional Tax to the Karnataka Government before I start working? If yes, then do I need to register the entity with some Professional Tax department, if there is any? Is there any exemption clause to Professional Tax?
    3. Since my professional services would be exported to clients outside of India, these would not qualify for Service Tax. However, do I still need to register with the Service Tax department?
    4. Since the earnings out of this properietorship would be in USD, am I legally obliged to get an Import Export Code for myself? If so, could you please point me to a resource on the Internet where I could get details of IEC and the procedure to get it?
    5. Given the broad expectations from the company, any other legal formality that I must fulfill per Indian and Karnataka State law before I could start this properteriorship?

    I would greatly appreciate your guidance in this matter.

    Thanks and regards,
    Abhi

  • CA MANISH KOTHARI

    Can service tax liabilty of a deceased proprietor be recovered from the legal representatives of the deceased? Kindly clarify with reference to legal judgments in service tax matters?

  • CA MANISH KOTHARI

    Can service tax liabilty of a deceased proprietor be recovered from the legal representatives of the deceased? Kindly clarify with reference to legal judgments in service tax matters?

  • Rishi

    Dear Mukesh,
    I have to start a online travel company and have some doubts:
    1. Want to start as a proprietor, but I want to register trademark for my company.
    2. Can I get bank account on company name.
    3. How do I legally register a company
    4. In future can I convert my company to pvt.ltd
    5. My website will be ready by next month and I want to take all my payments in company bank a/c.
    6. I am presently working for a pvt.ltd company, so can I start the company on my name??
    7. Tax will be on turnover or on PROFIT?

    Requesting you to help on above queries. Awaiting your reply.
    Regards,
    Rishi

  • Rishi

    Dear Mukesh,
    I have to start a online travel company and have some doubts:
    1. Want to start as a proprietor, but I want to register trademark for my company.
    2. Can I get bank account on company name.
    3. How do I legally register a company
    4. In future can I convert my company to pvt.ltd
    5. My website will be ready by next month and I want to take all my payments in company bank a/c.
    6. I am presently working for a pvt.ltd company, so can I start the company on my name??
    7. Tax will be on turnover or on PROFIT?

    Requesting you to help on above queries. Awaiting your reply.
    Regards,
    Rishi

  • Gaurav Kohli

    Dear Mr.Mukesh,

    If one goes for a sole proprietorship in the beginning, can it be converted into a Private Ltd. later? What are the steps & obstacles?

    In a company that creates software & does consulting, do I need other permissions / licenses ?

    In a proprietorship , can the business expenses be used to reduce tax liability on salary from my job?

  • Gaurav Kohli

    Dear Mr.Mukesh,

    If one goes for a sole proprietorship in the beginning, can it be converted into a Private Ltd. later? What are the steps & obstacles?

    In a company that creates software & does consulting, do I need other permissions / licenses ?

    In a proprietorship , can the business expenses be used to reduce tax liability on salary from my job?

  • Tapan

    In a proprietorship , can the business expenses be used to reduce tax liability on salary from my job?

  • Tapan

    In a proprietorship , can the business expenses be used to reduce tax liability on salary from my job?

  • S A Choudhury

    Hi Sir

    Thank you verymuch for the useful information that you share.

    I need a small help

    Sir, I have a Pvt. Limited company and I wish to start a separate proprietorship concern as a division of the Pvt. Limited company with a different business name can you please help me with the information of the procedure and documents required to register the Proprietorship concern.

    It will be a Service Company and expecting turn over to be less than 5 lacs for the first 2 years.

    Kindly advise!

    Regards
    S A Choudhury

  • S A Choudhury

    Hi Sir

    Thank you verymuch for the useful information that you share.

    I need a small help

    Sir, I have a Pvt. Limited company and I wish to start a separate proprietorship concern as a division of the Pvt. Limited company with a different business name can you please help me with the information of the procedure and documents required to register the Proprietorship concern.

    It will be a Service Company and expecting turn over to be less than 5 lacs for the first 2 years.

    Kindly advise!

    Regards
    S A Choudhury

  • Abhinav Mehra

    Hey Mukesh,

    I am wanting to start a service firm, basically in to web designing along with loads of other services.
    I needed assistance on 2 ends.
    Firstly, this is gonna be quite small time wont be earning to much initially and wont earn much. At what amount of annual profit will i start paying tax.
    Secondly, im confused how to get registered. I constantly hear 2 methods, one is the shops and establishment act and the other is tht i us need to open a current account with a bank and a couple of rubber stamps.

    Awaiting your reply. Thanks in advance!

    Regards
    Abhinav

  • Abhinav Mehra

    Hey Mukesh,

    I am wanting to start a service firm, basically in to web designing along with loads of other services.
    I needed assistance on 2 ends.
    Firstly, this is gonna be quite small time wont be earning to much initially and wont earn much. At what amount of annual profit will i start paying tax.
    Secondly, im confused how to get registered. I constantly hear 2 methods, one is the shops and establishment act and the other is tht i us need to open a current account with a bank and a couple of rubber stamps.

    Awaiting your reply. Thanks in advance!

    Regards
    Abhinav

  • Mohit Gilotra

    Can a proprietorship firm be opened in the name of minor ?( under Guardianship A/c)

  • Mohit Gilotra

    Can a proprietorship firm be opened in the name of minor ?( under Guardianship A/c)

  • dhiru mehta

    Dear Mukeshji,

    Your blog is good knowledge base. I have a peculiar problem. Can you guide me please ?

    * I have supplied goods on credit terms to A company – proprietorship company.

    * proprietor of the company has expired before I can get my payment.

    * Now their legar heir (son) is running business under same name but all vat number / cst numbers changed, but my payment is not made.

    * Is there any legal recourse I can take against the legal heirs to recover my dues ? pls advice.

  • dhiru mehta

    Dear Mukeshji,

    Your blog is good knowledge base. I have a peculiar problem. Can you guide me please ?

    * I have supplied goods on credit terms to A company – proprietorship company.

    * proprietor of the company has expired before I can get my payment.

    * Now their legar heir (son) is running business under same name but all vat number / cst numbers changed, but my payment is not made.

    * Is there any legal recourse I can take against the legal heirs to recover my dues ? pls advice.

  • Hello Mukeshji. Very nice to see such a discusion ongoogle. Much appriciated. I m 25 and gave good experiance in IT and Communication application’s used onboard ships and offshore industry. Have finaly desided to start my own service under sole proprietorship. I will be having customers paying the invoices in both INR and USD. For venders / customers within paying in India or INR i can simply cater them with the cusrrent account. But ships are sailing worldwide and i will be subcontacting my venders outside India and paying them in USD and collecting funds from customers in USD. Can you pls advise me what are teh procedure required to Open USD A/C for a sole proprietorship operating from Home. Require ment of USD A/C is only to avoid high bank charges charged by the banks while paying money to forign venders.
    Appriciate your early reply.

  • Hello Mukeshji. Very nice to see such a discusion ongoogle. Much appriciated. I m 25 and gave good experiance in IT and Communication application’s used onboard ships and offshore industry. Have finaly desided to start my own service under sole proprietorship. I will be having customers paying the invoices in both INR and USD. For venders / customers within paying in India or INR i can simply cater them with the cusrrent account. But ships are sailing worldwide and i will be subcontacting my venders outside India and paying them in USD and collecting funds from customers in USD. Can you pls advise me what are teh procedure required to Open USD A/C for a sole proprietorship operating from Home. Require ment of USD A/C is only to avoid high bank charges charged by the banks while paying money to forign venders.
    Appriciate your early reply.

  • Sam

    The thing is that there was a sole propriter firm in the name of my mother who died and we submitted the licence of registration to the excise department, giving an undertaking that me, my father and my brother will pay the liabilities towards my mother to the government

    I have the following questions:

    1. That can the personal liability that me, my father and my brother had warranted towards the government, can be paid through the company being run as part of a HUF which was started by my father after the firm on the name of my mother was closed?

    2. Can i avoid the liability in any manner?

  • Sam

    The thing is that there was a sole propriter firm in the name of my mother who died and we submitted the licence of registration to the excise department, giving an undertaking that me, my father and my brother will pay the liabilities towards my mother to the government

    I have the following questions:

    1. That can the personal liability that me, my father and my brother had warranted towards the government, can be paid through the company being run as part of a HUF which was started by my father after the firm on the name of my mother was closed?

    2. Can i avoid the liability in any manner?

  • Dipankar Sharma

    Dear Sir,
    i do software development
    1) i have a pan no which was taken some 5 years back, when i was a salaried person. for past 4 years i have started my own sole proprietor business but never i paid any tax as i was always short of money. My yearly turnover was less than 4 lakh.I want to file it now if u can please guide me.

    i don’t have vat and service tax no. as it difficult to get business it has become mandatory for me to get the vat and service tax registeration no.

    2. Can i have more than one sole proprietor in my own name. Vat registeration no and service tax no under which sole proprietor name , both of the sole proprietorship has trade license.

    Thanking You

  • Dipankar Sharma

    Dear Sir,
    i do software development
    1) i have a pan no which was taken some 5 years back, when i was a salaried person. for past 4 years i have started my own sole proprietor business but never i paid any tax as i was always short of money. My yearly turnover was less than 4 lakh.I want to file it now if u can please guide me.

    i don’t have vat and service tax no. as it difficult to get business it has become mandatory for me to get the vat and service tax registeration no.

    2. Can i have more than one sole proprietor in my own name. Vat registeration no and service tax no under which sole proprietor name , both of the sole proprietorship has trade license.

    Thanking You

  • Ajay

    Dear Mr Mukesh,

    i wants to start an adventure tourism company and i want that the name and logo of my company to be patent and no one can use name and logo of my company, i just forgot to tell you that i want to start company as a sole proprietorship right now, so is it possible that i can apply for patent on name and logo? if yes then please tell me how and from where, please give me the link for patent if possible.

  • Ajay

    Dear Mr Mukesh,

    i wants to start an adventure tourism company and i want that the name and logo of my company to be patent and no one can use name and logo of my company, i just forgot to tell you that i want to start company as a sole proprietorship right now, so is it possible that i can apply for patent on name and logo? if yes then please tell me how and from where, please give me the link for patent if possible.

  • ANIL KUMAR

    hello sir,
    Dear Mr. Mukesh
    Is it possible that one proprietor can be change by another proprietor in existing import export code(IEC) while the name of company is unchanged?

  • ANIL KUMAR

    hello sir,
    Dear Mr. Mukesh
    Is it possible that one proprietor can be change by another proprietor in existing import export code(IEC) while the name of company is unchanged?

  • Rahul Gupta

    Dear Sir,

    i want start online consultancy from home. and want to register as a proprietorship firms. and want to register from my lucknow address. so please tell me whre is the office in up from where i can do all the things and take information. this time i m n noida. can i do this from noida.

  • Rahul Gupta

    Dear Sir,

    i want start online consultancy from home. and want to register as a proprietorship firms. and want to register from my lucknow address. so please tell me whre is the office in up from where i can do all the things and take information. this time i m n noida. can i do this from noida.

  • I am an exporter of goods and also provide services of commission agent. Both businesses are in the same proprietorship concern. The commission is what I receive in case I pass on the order to another exporter and the value is far below the 10.00 lakhs exemption limit. However, what seems to be a catch is that the service should not be provided under a brand name (registered or not). Is the name of a proprietorship concern normally considered a brand name for purpose of service tax?

  • I am an exporter of goods and also provide services of commission agent. Both businesses are in the same proprietorship concern. The commission is what I receive in case I pass on the order to another exporter and the value is far below the 10.00 lakhs exemption limit. However, what seems to be a catch is that the service should not be provided under a brand name (registered or not). Is the name of a proprietorship concern normally considered a brand name for purpose of service tax?

  • S.Thiraviasundaram

    Dear Sir,

    Can a Properietor transfer the Proprietership concern to his son keeping the the same RC and CST and if this could be done I
    understand the son should necessarily to go in for a new PAN

    Thanking you

  • S.Thiraviasundaram

    Dear Sir,

    Can a Properietor transfer the Proprietership concern to his son keeping the the same RC and CST and if this could be done I
    understand the son should necessarily to go in for a new PAN

    Thanking you

    • S.Thiraviasundaram

      Dear Sir,

      I am awaiting your reply to my query of 18th August

  • H N NARAYANASWAMY

    Can an individual act as a proprietor for several proprietorship concerns ?

  • H N NARAYANASWAMY

    Can an individual act as a proprietor for several proprietorship concerns ?

  • Archana

    I want to know where do you get a license for security agency?Which govt agency provides the same in UP?

  • Suzanne

    Hi Mukesh,

    I have started a home business which is now picking up well. My query is regarding bank account: As it’s a sole proprietorship, Can I open a bank account in my business’ name for all business related funds, and is that more beneficial than operating the funds from an account in my own name?

  • Suzanne

    Hi Mukesh,

    I have started a home business which is now picking up well. My query is regarding bank account: As it’s a sole proprietorship, Can I open a bank account in my business’ name for all business related funds, and is that more beneficial than operating the funds from an account in my own name?

  • prasanna shete

    Dear Sir,

    My question is regarding VAT Number.
    Can we use the single VAT Number for different trading Company’s???
    e.g.- If i want to start a new trading Company & i required VAT number. Incase if i doesnt have the same can i use VAT number of some Known Persons Proprietory Firm for my Trading Company????

  • prasanna shete

    Dear Sir,

    My question is regarding VAT Number.
    Can we use the single VAT Number for different trading Company’s???
    e.g.- If i want to start a new trading Company & i required VAT number. Incase if i doesnt have the same can i use VAT number of some Known Persons Proprietory Firm for my Trading Company????

  • Sofia Singh

    Dear Mukesh,
    We want to establish a propiertorship company for the sole purpose of exports (mainly textiles garments). Please advise if we must register with the sale tax department in our state (Uttaranchal) and if we may be exempted from paying tax as items won’t be sold in India but exported overseas. Thank you.

  • Sofia Singh

    Dear Mukesh,
    We want to establish a propiertorship company for the sole purpose of exports (mainly textiles garments). Please advise if we must register with the sale tax department in our state (Uttaranchal) and if we may be exempted from paying tax as items won’t be sold in India but exported overseas. Thank you.

  • Amlan

    Hi Mukesh,
    I am open a proprietorship firm in bangalore. It is a software development business. Everything will be done online and i will be working from my home. Can you suggest step by step process i have to follow to set up this.

  • Babi

    Dear Mr. Mukesh,

    I need a urgent favour from you. I started a Online News Network on a sole proprietorship. I normally do content writing and SEO services and deal with foreign clients only.

    I believe that my services are not covered under Service Taxation. But due to the bad advice from a lawyer, I went for service registration and even paid service tax during the last quarter on some foreign remittances.

    1) My services should not come under service tax law.

    2) My net annual income under these services are less than 10 lac.

    So, should I just close down the proprietorship firm and surrender the service tax registration number. Is it possible? I don’t want to pay any more service tax, as I am not liable to do that. Please advice me.

    Thanks,
    Babi

  • Babi

    Dear Mr. Mukesh,

    I need a urgent favour from you. I started a Online News Network on a sole proprietorship. I normally do content writing and SEO services and deal with foreign clients only.

    I believe that my services are not covered under Service Taxation. But due to the bad advice from a lawyer, I went for service registration and even paid service tax during the last quarter on some foreign remittances.

    1) My services should not come under service tax law.

    2) My net annual income under these services are less than 10 lac.

    So, should I just close down the proprietorship firm and surrender the service tax registration number. Is it possible? I don’t want to pay any more service tax, as I am not liable to do that. Please advice me.

    Thanks,
    Babi

  • Hi,

    I would like to open a sole proprietorship firm. to provide consultaing service in telecom & software services. as we provide services to other companies we need service tax registration also.

    with 5 employees and small office.

    what kind of documents needed for registering. ?

  • Jyotsna Gupta

    Hi, I am planning to start my sole proprietorship company. For that I have certain questions which are as follows :-
    1. Can we issue any certificate to the employees on the letterhead of the company?
    2. Can we start an educational training institute and put the same trainees in the business as employees?
    3.Can we bond the employees?
    4.Can we tie-up with other company?
    5.do we have to give wage or salary to the employees? Is that mandatory…??
    Want to start as a proprietor, but I want to register trademark for my company.
    *** Can I get bank account on company name.
    ***How do I legally register a company
    ***In future can I convert my company to pvt.ltd
    *** My website will be ready by next month and I want to take all my payments in company bank a/c.
    ***I am presently working for a pvt.ltd company, so can I start the company on my name??
    **. Tax will be on turnover or on PROFIT?

  • Jyotsna Gupta

    Hi, I am planning to start my sole proprietorship company. For that I have certain questions which are as follows :-
    1. Can we issue any certificate to the employees on the letterhead of the company?
    2. Can we start an educational training institute and put the same trainees in the business as employees?
    3.Can we bond the employees?
    4.Can we tie-up with other company?
    5.do we have to give wage or salary to the employees? Is that mandatory…??
    Want to start as a proprietor, but I want to register trademark for my company.
    *** Can I get bank account on company name.
    ***How do I legally register a company
    ***In future can I convert my company to pvt.ltd
    *** My website will be ready by next month and I want to take all my payments in company bank a/c.
    ***I am presently working for a pvt.ltd company, so can I start the company on my name??
    **. Tax will be on turnover or on PROFIT?

  • khalid

    Hello Mr. Mukesh,

    Thanks for explanations, but i have one more question. After the proprietor,s death what happen to the liabilities upon the entity such as tax dues, cases etc. whether they come upon there family and children or they end with the owners life.

  • khalid

    Hello Mr. Mukesh,

    Thanks for explanations, but i have one more question. After the proprietor,s death what happen to the liabilities upon the entity such as tax dues, cases etc. whether they come upon there family and children or they end with the owners life.

  • Jd

    Dear Mr. Mukesh,

    I am working in BMC and want to start sole proprietorship on my wife’s name for supplying stationery to BMC.
    Please let me know
    Do I require to legally registering my Sole Proprietorship?
    What extension can we use e.g. Supplier, Enterprises, Traders etc.?
    Do I require registering with VAT or Service Tax?

    Thanks
    Jd

  • Jd

    Dear Mr. Mukesh,

    I am working in BMC and want to start sole proprietorship on my wife’s name for supplying stationery to BMC.
    Please let me know
    Do I require to legally registering my Sole Proprietorship?
    What extension can we use e.g. Supplier, Enterprises, Traders etc.?
    Do I require registering with VAT or Service Tax?

    Thanks
    Jd

  • Shriyas Mathur

    Hello Mukesh,

    I should really appreciate your help towards people like us seeking help. I’ve a question for you:
    Q. I’m indian citizen and currently working in USA so my status is NRI. Can i open a “Sole Proprietorship” firm in india in my name. If not, are there any alternatives to it?

    Thanks Again
    Shriyas

    • NRI can’t start a proprietorship firm in India, but he can become a partner in a partnership firm. Alternatively you can incorporate a Private Limited company, which is more suitable to you.

  • Shriyas Mathur

    Hello Mukesh,

    I should really appreciate your help towards people like us seeking help. I’ve a question for you:
    Q. I’m indian citizen and currently working in USA so my status is NRI. Can i open a “Sole Proprietorship” firm in india in my name. If not, are there any alternatives to it?

    Thanks Again
    Shriyas

    • NRI can’t start a proprietorship firm in India, but he can become a partner in a partnership firm. Alternatively you can incorporate a Private Limited company, which is more suitable to you.

  • Thomas

    Hi Mukesh,
    I see that Rishi has already asked all the questions that I have been trying to find answers for. I have copied the same below and would appreciate if you could answer them. Thanks

    I have to start a online travel company and have some doubts:
    1. Want to start as a proprietor, but I want to register trademark for my company.
    2. Can I get bank account on company name.
    3. How do I legally register a company
    4. My website will be ready by next month and I want to take all my payments in company bank a/c.
    5. Tax will be on turnover or on PROFIT?

  • Thomas

    Hi Mukesh,
    I see that Rishi has already asked all the questions that I have been trying to find answers for. I have copied the same below and would appreciate if you could answer them. Thanks

    I have to start a online travel company and have some doubts:
    1. Want to start as a proprietor, but I want to register trademark for my company.
    2. Can I get bank account on company name.
    3. How do I legally register a company
    4. My website will be ready by next month and I want to take all my payments in company bank a/c.
    5. Tax will be on turnover or on PROFIT?

  • kamlesh chuttar

    i am having sole-proprietary concern.i want to issue form no.16 to my nontaxable salaried employees what are the requirements that i have to fulfill to issue them form no 16

  • kamlesh chuttar

    i am having sole-proprietary concern.i want to issue form no.16 to my nontaxable salaried employees what are the requirements that i have to fulfill to issue them form no 16

  • Jagdish

    Dear Mr. Mukesh,
    One of the features of the sole proprietorship is that the organization exists only so long as the proprietor is alive. On the death of the proprietor, the business comes to an end.
    Now my question is can the legal heir not continue the business as a manager till it is decided who the next proprietor would be. Also under Income Tax Act is it possible to return the income of the whole year (part of the year managed by the legal heir) from april 09 to Mar 10, say if the proprietor died in Sept 09 under the PAN of the original proprietor who died.
    Thanks.

  • Jagdish

    Dear Mr. Mukesh,
    One of the features of the sole proprietorship is that the organization exists only so long as the proprietor is alive. On the death of the proprietor, the business comes to an end.
    Now my question is can the legal heir not continue the business as a manager till it is decided who the next proprietor would be. Also under Income Tax Act is it possible to return the income of the whole year (part of the year managed by the legal heir) from april 09 to Mar 10, say if the proprietor died in Sept 09 under the PAN of the original proprietor who died.
    Thanks.

  • gaurav

    hi mr. Mukesh,
    i want to start a sole proprietor firm in PHARMACEUTICAL SECTOR, can u advice me what r the necessary requirment and criteria to start it?

    1. Want to start as a proprietor, but I want to register trademark for my company.
    2. Can I get bank account on company name.
    3. How do I legally register a company
    4. In future can I convert my company to pvt.ltd
    5. My website will be ready by next month and I want to take all my payments in company bank a/c.
    6. I am presently working for a pvt.ltd company, so can I start the company on my name??
    7. Tax will be on turnover or on PROFIT?

    Requesting you to help on above queries.
    awaiting for ur precious advice.
    with warm regards
    GAURAV

  • gaurav

    hi mr. Mukesh,
    i want to start a sole proprietor firm in PHARMACEUTICAL SECTOR, can u advice me what r the necessary requirment and criteria to start it?

    1. Want to start as a proprietor, but I want to register trademark for my company.
    2. Can I get bank account on company name.
    3. How do I legally register a company
    4. In future can I convert my company to pvt.ltd
    5. My website will be ready by next month and I want to take all my payments in company bank a/c.
    6. I am presently working for a pvt.ltd company, so can I start the company on my name??
    7. Tax will be on turnover or on PROFIT?

    Requesting you to help on above queries.
    awaiting for ur precious advice.
    with warm regards
    GAURAV

  • Hi, just visited your blog first time, and found it quite intresting. Nice post indeed. Thanks for sharing it to all
    Regards
    Riyaz
    Software Development Lucknow

  • Hi, just visited your blog first time, and found it quite intresting. Nice post indeed. Thanks for sharing it to all
    Regards
    Riyaz
    Software Development Lucknow

  • Bhavya Suvarna

    Dear Mr.Mukesh,

    I want to start a toy library in my city which is situated in karnataka. i would like to take your advice whether i should register my business under ROC or can i go ahead with Sole Proprietorship. As well might be at later stage i want to open my toy library franchise in different locations.
    Kindly suggest me and help me in taking decision
    Initial Investment is around 1 Lakh

  • good work mukesh kepp goinnnn

  • Dr Chetan Parikh

    As sole propritor of our hospital,we file i tax return on dr’s name.In Payment by TPA in mediclaim, cheque is issued in compulsorily in name of Hospital.According to new circularTDS will be deducted in name of hospital.hospital can not have pan no,as return can be filed only in name of Dr.TDS will be credited in name of Hospital but it can’t have PAN no. What to do?

    • Individual PAN of the doctor will be the PAN of the Hospital if doctor himself is sole proprietor of the that Hospital.

  • Dr Chetan Parikh

    As sole propritor of our hospital,we file i tax return on dr’s name.In Payment by TPA in mediclaim, cheque is issued in compulsorily in name of Hospital.According to new circularTDS will be deducted in name of hospital.hospital can not have pan no,as return can be filed only in name of Dr.TDS will be credited in name of Hospital but it can’t have PAN no. What to do?

    • Individual PAN of the doctor will be the PAN of the Hospital if doctor himself is sole proprietor of the that Hospital.

  • varun

    Hi,
    My name is Varun,I am a sub broker in stock market.& have a propritorship account..Now my question is this that..some guys want to give me deposit for trading in stock market..I want to take that deposite in my business name..against that deposite I want to issue some certifiate..Is it possible that I can issue a certificate under my SUB-BROKER reg.number..? or I have to open PVT.LTD. company??…or I can take that money as a loan from thoses guys to my business…!!
    Please help

    • You can not accept deposit from public without registarting your company as NBFC with RBI.

  • varun

    Hi,
    My name is Varun,I am a sub broker in stock market.& have a propritorship account..Now my question is this that..some guys want to give me deposit for trading in stock market..I want to take that deposite in my business name..against that deposite I want to issue some certifiate..Is it possible that I can issue a certificate under my SUB-BROKER reg.number..? or I have to open PVT.LTD. company??…or I can take that money as a loan from thoses guys to my business…!!
    Please help

    • You can not accept deposit from public without registarting your company as NBFC with RBI.

  • Nagaraj Gandikote

    I was in job till Sep 11, 2009. I always wanted to start something on my own and work for myself. I want to start a company (Sole Proprietor) which will train people in Shares and also give some practicals which helps the students to implement the learnings by investing Virtual Money. Presently I am depended on one of my friends for trainings but later I wish to continue on my own. Do I need a Shop to continue my busniess? Presently I am in a rented house and the construction of my house is on. I intend to shift to my house and continue the business there. I am open to taking training classes in some hotels rooms or rented training centers but I am not too keen on opening a shop.Apart from trainings I do trading in Commodities and equity F&O. Slowly I will expand to investing in Forex as well. My Questions are
    1) Can I continue in house rather than look out for a shop?
    2) Do I just need to open a Current Account and not register my firm?
    Rgds, Nagaraj

  • priya

    please can you give more information about sole proprietorship? it’s very urjent

  • priya

    please can you give more information about sole proprietorship? it’s very urjent

  • I plan to start up a sole-proprietorship concern. Can you please tell me if I need to have a name board outside my address for such concerns? I live in a university campus and am not allowed to put name boards.
    Thank you for the informative post, and in advance for your clarification.

  • I plan to start up a sole-proprietorship concern. Can you please tell me if I need to have a name board outside my address for such concerns? I live in a university campus and am not allowed to put name boards.
    Thank you for the informative post, and in advance for your clarification.

  • NITIN

    Dear Mukesh

    Can a sole proprietor called can he be considered as CEO, COO or any other names

    Please let me know at the earlier

    regards
    Nitin

  • NITIN

    Dear Mukesh

    Can a sole proprietor called can he be considered as CEO, COO or any other names

    Please let me know at the earlier

    regards
    Nitin

  • SANJOY BHADRA

    Dear Sir,
    Presently I am going to launch online book selling website. Expecting 1st year our turnover will not be more than 4 lacs. Now I am staying in Aborad and My brother is staying in Westbengal . We do not have any employee and we will run business from our home, India.Now we are planning to open current Bank out in the name of our company. Is it required to register our company? because it is only name of my brother and myself nobody else, it is just propeitorship. Please advise.

  • SANJOY BHADRA

    Dear Sir,
    Presently I am going to launch online book selling website. Expecting 1st year our turnover will not be more than 4 lacs. Now I am staying in Aborad and My brother is staying in Westbengal . We do not have any employee and we will run business from our home, India.Now we are planning to open current Bank out in the name of our company. Is it required to register our company? because it is only name of my brother and myself nobody else, it is just propeitorship. Please advise.

  • MKJ

    Dear Mukesh Sir,

    I would like to open a sole prop horticulture nursery firm in a name diffrent from my own (E.g., My name is Manoj, but I would like to open the sole prop firm in the name of XYZ Enterprises).

    Questions:

    1) How can I get a bank account in the name of XYZ Enterprises? What documents do I need to produce to the bank?
    2) Do I need to register the firm anywhere for the bank account?
    3) Can I issue Invoices, Receipts, Purchase Orders, etc in the name of the firm (XYZ Enterprises)?

    I would appreciate if you could provide some inputs for the above questions

    Best regards

    MKJ

  • Shilpa

    Thanks Sir,
    Do continue the good work.
    I had some queries but after browsing through your blog have got a clarification. Just one thing as a sole propreitor can I put Inc. with my company name?

    • Yes, You can put Inc. in the name of your sole proprietorship.

  • Shilpa

    Thanks Sir,
    Do continue the good work.
    I had some queries but after browsing through your blog have got a clarification. Just one thing as a sole propreitor can I put Inc. with my company name?

    • Yes, You can put Inc. in the name of your sole proprietorship.

  • arjun sagar

    Hi,

    one of my friends (who is a foreigner) wants to start a business in india. @ the moment he intends it to be a sole proprietorship. eventually he plans on turning it into a company.

    Can he as a foreigner (i.e. not a PIO/NRI) set up a business in india?
    for import/export under a sole propreitorship?

    if no, then can such arrangement be made under a pvt. ltd. company or a partnership for him to be a director or partner respectively??

    please advice

    thanks

  • Deepansh

    Thanks for such useful informations.
    I have a confusion. Can a government(or private limited) employee start side business by sole proprietorship. I am appearing for PO exam. I do not want my career blocked by any such law. that is if i start sole proprietorship, Will I be eligible to appear for government job. so please help.

  • Deepansh

    Thanks for such useful informations.
    I have a confusion. Can a government(or private limited) employee start side business by sole proprietorship. I am appearing for PO exam. I do not want my career blocked by any such law. that is if i start sole proprietorship, Will I be eligible to appear for government job. so please help.

  • Deepansh

    One more thing,
    As your response to one question says: Government servant can not start own business. Does the same apply to any company job(software)? And If I start sole proprietorship business and get cleared in PO exam. Can i dissolve my business then?
    Thanks. Please help.

  • Abhinav

    Your blog is an ocean of valuable information. Its really great !!!

    Here’s my query:

    I want to start up a sole proprietorship firm through which I will sell Software Products in India and abroad.

    Do I need to go ahead with VAT registration?
    Please brief me about the taxation norms involved.

    Regards and Thanks,
    Abhinav

  • abhishek kumar

    Dear Mukesh ji,
    I want to start my placement consultancy & Property dealing work in delhi from rented premises.
    My queries are as follows-
    1)Initially can i start my work without service tax registration?
    2)Can it is mandatory to register it as firm/proprietorship/company?Without registration can`t i start my work?
    3)Wheather separate bank account is mandatory or my present saving account is sufficient for my transaction of receipts /expenditure ?
    4)wheather i can print the name of my business on visiting card without registering a name?

    Pls help Sir.

    caabhishekkumar@gmail.com

  • janice fernandes

    Great work Mukesh

  • janice fernandes

    Great work Mukesh

  • Remesh

    Hi Mukesh,

    I would like to know certain things which are very important. I asked many people whom I know personally, unfortunately none of them were sure of what I asked.
    I am a freelancer working from my home. My main job is to write contents for the websites of my U.S. client. He was sending me money as personal money using PayPal. My annual income is around 3,60,000 Rs. (it varies depending on the value of US$).
    Am I supposed to get this IE code? Am I supposed to go to income tax office and pay tax every year? Sorry, I am absolutely unaware of such things.
    Thanks in advance!

  • amarinder

    Hi,

    I am starting an adventure cum experiential travel company in Dehradun. Its called infinite journeys.

    I have some questions:
    1) Do i need some governments permission to start the firm, as its a sole proprietorship?
    2) Do i need to open a company account in dehradun so as to obtain PAN and TAN from there?
    3) What is the process and procedures to register the name and logo of the company?

    Please let me know as soon as possible.

    For the people viewing the comments if any of you are interested in travelling to any destination and on any logical budget can email me. My email is amarindermarwah@gmail.com.

    I am starting many trips to Leh in this summer. Which range from Rs. 10000 to 2 Lacs. My contact number is +919958150043

  • Amol

    Hi. ..

    if both parents r working with Govt Company, can they start sole proprietary firm in the name of son/daughter who is minor? in short can minor be a sole proprietor ?

  • Mitul Patel

    Hello dear Mukesh,
    partnership firm having loss of few lakhs last year and because of late filing returns of firm, we cant take loss as an expense this year as our CA says so in that case what to do?its really urgent please reply me as soon as possible.

  • Manjit Virdi

    I am the sole proprietor of a firm. Is it possible fo r me to will this sole proprietorship firm to a member of my family wherein all the assets, liabilities, name of the firm etc. are passed on to him after my death and the business of the firm continues as if I myself was alive.

  • I want to start a company for design and development of websites, i have created the company webstie and need to create a company bank account and invoice for the clients. Is it necessary to do a registration for the company. At present i dont have a office as such and do freelancing from my home. Please advice.

  • Chandrasekaran

    Hi Mukesh,
    Have a query. Please let me know if any undertaking given to sole propritorship company be used after transfer of propritorship

  • Akshay

    Dear Mukesh
    My inlaws have a large sole proprietorship business that into bidi manufacturing , now if i join that business please let me know taxability of my income under following conditions
    i) if i take salary from the business
    ii) profit sharing
    what will be the other compliances that need to be followed by the business and me also.
    Please reverst asap.
    Thanks
    Akshay

  • Volacious

    Hi,

    Great blog and very informative.

    I have a question to ask:

    I started out with a small business from home and later functioned and registered as a “sole proprietorship firm”.

    After a year, I got a Government job and have now joined it. Please advise on how I should run my business now, am I allowed to own a firm with a Government job (please note that i have the firm long before i got my Government job) ?

    Please advice

  • arthand

    My friend from europe who is staying in Mumbai for 4 years and working for a european company would like to start a sole properitorship firm.Can a foreign national start a properitory firm and id so what is the procedure?

    • A foreign national can not start a sole proprietorship firm. In case of sole proprietorship firm the liability of proprietor is unlimited and Indian law can not create any charge on his personal assets out side India.

  • arthand

    My friend from europe who is staying in Mumbai for 4 years and working for a european company would like to start a sole properitorship firm.Can a foreign national start a properitory firm and id so what is the procedure?

    • A foreign national can not start a sole proprietorship firm. In case of sole proprietorship firm the liability of proprietor is unlimited and Indian law can not create any charge on his personal assets out side India.

  • Akshay

    Dear Mukesh
    My in laws have a soleproprietorship business that to into bidi manufacturing. Now if wish to join that business can u tell me taxability of my
    income derived from that business under the following circumstances
    i) if I receive salary from the business
    11) if I receive profit of the business

    Plz let me know what all compliances I and the business need to adhere under both the above options.

  • Akshay

    Dear Mukesh
    My in laws have a soleproprietorship business that to into bidi manufacturing. Now if wish to join that business can u tell me taxability of my
    income derived from that business under the following circumstances
    i) if I receive salary from the business
    11) if I receive profit of the business

    Plz let me know what all compliances I and the business need to adhere under both the above options.

  • deepak jain

    sir my father died w/o will and was a propreitor in a firm will you please advice me who will be the propreitor of this existing firm .We in all are 5 legal heirs & my younger brother wants to illegally acquire the firm by himself appointing my mother as the propreitor w/o my consultation please advice that are we also legally part of the said firm and what can we do to stop him from doing so legally

    • Jimmy

      Deepak I’m sorry mate but with out a will it will be very hard to redeem things unless you have political or backing of some higher ranking officials. In India there is toooo much of red tape in India thus it will be an uphill task. 

  • deepak jain

    sir my father died w/o will and was a propreitor in a firm will you please advice me who will be the propreitor of this existing firm .We in all are 5 legal heirs & my younger brother wants to illegally acquire the firm by himself appointing my mother as the propreitor w/o my consultation please advice that are we also legally part of the said firm and what can we do to stop him from doing so legally

  • preeti

    can a cheque in the name of propreitor be collected in the a/c of the propreitorship firm?

    • No, it’s not possible. You have to open a bank account in the name of Firm only.

  • preeti

    can a cheque in the name of propreitor be collected in the a/c of the propreitorship firm?

    • No, it’s not possible. You have to open a bank account in the name of Firm only.

  • Manash

    Sir,

    What are the designations can a sole properitorship firm can offer in India ???

    Regards,

    Manash

    • He can write “Proprietor” as designation only.

  • Manash

    Sir,

    What are the designations can a sole properitorship firm can offer in India ???

    Regards,

    Manash

    • He can write “Proprietor” as designation only.

  • Jay

    hi, i was reading your blog and find it very informative. I have a few concerns and would like your guidence on these.
    1.I propose to start a export firm, currently just by myself. Does this have to be a sole propreitorship. What are the other options.
    2. i gather it would be better to open a current a/c. please confirm if this is easily possible.
    3. will i be able to avail of export packing credit from any financial institution. which are the ones who support such ventures.
    4. I also propose to do small quantities of sales in local market. what registration do i need. what licenses.
    please guide me.
    thanks

  • Hi,
    I have just visited your blog and found it quite useful for me. Thanks for sharing.
    Regards
    Utpal

    Website Development Guwahati

  • Hi,
    I have just visited your blog and found it quite useful for me. Thanks for sharing.
    Regards
    Utpal

    Website Development Guwahati

  • Sir,

    I am a small web/graphics designer and web hosting reseller I wanted to open a current account under the name of Host Rise,
    Do I need to register my company to open current account?
    Do I need to register for sale tax?
    How do i get a sale tax no?

  • MSingh

    Hi Mukesh,

    I need to know the procedure to register a sole proprietorship company in Delhi/Gurgaon and the need to know how much does it cost? Do you also offer this service?

    Thanx

  • Wonderful post with great answers to questions

  • Wonderful post with great answers to questions

  • Dr. Babita Singh

    Sir,
    I have sole proprietorship Publishing Co. (Educational Books) and have also opened a current account. I want to know what are the other steps needs to be followed. Do I have to get licence, register for sales tax/service tas/Vat as for selling books I have to go for billing. I will be selling books directly and through distributors.
    Thanks
    Babita

  • krishnakumar

    Dear Mukesh,

    I have read all your comments and it is much helpful. But for the past few months the answers to the queries are very few.. Know that the queries are abundant in numbers, but we are pleased to know more from you kindly answer the readers’ queries as you were doing before, as you like professionals who shares the exact information are very rare.

    again thanx alot for your valuable help,…

    regards
    Krishnakumar

  • Puja

    Hi

    I am working with with a private co. as software engineer but want to start a website under proprietorship on my mother’s name. So, plz let me know –

    1. Where I have to register i.e. some form/office or what ?
    2. To open a current account on company’s name what documents will Bank ask for?
    3. My payments of website will be all online so any service taxes ?

    Thanks

  • Hi, i would like to start a propritorship firm in India, can i start the firm in Kerala and start the business in out of Kerala i.e. Bangalore or Madras. If so kind advice the methord on how to do this?

  • Abha

    Hi Mukesh..
    I wish to open a website that will offer psychometric tests such as anxiety, anger test to customers(mainly from US) which will carry fee and also will provide free counselling to them. I dont have any degree in psychology.

    1. Am I eligible to charge for the tests and offer free counselling?
    2. Also please tell me whether my saving bank account be used for wire tranfer or i need to create a separate current account?

  • audin

    Hi Javier,

    I am planning to start a private tuition of few students at a friends office. he does not use the office at certain time and so i will be utilizing the resources.
    I was thinking of putting the tuitions right now as a sole proprietor based. I am a little confused on what procedure to step on forward.

    It will be a great help to know something about it. thanks!

  • audin

    Hi Mr.Mukesh,

    I am planning to start a private tuition of few students at a friends office. he does not use the office at certain time and so i will be utilizing the resources.
    I was thinking of putting the tuitions right now as a sole proprietor based. I am a little confused on what procedure to step on forward.

    It will be a great help to know something about it. thanks!

  • Ramanathan

    Hi Mukesh,

    I readyourblogs and found them very useful. Belowis my query. Await your response. Thanks.

    Mr. A who is the proprietor of M/S. Tours & Travels. Mr. A dies and his son Mr. B is running the shop M/s Tours & Travels. Can his son Mr. B be designated as a proprietor of M/s. Tours & Travels. What are the formalities to be considered by Mr. B in this regards

    Also if Mr. A has three legal heirs including Mr. B, in such case I understand that Mr. B needs to obtain a NO OBJECTION CERTIFICATE from the other two legal heirs for Mr. B to be designated as proprietor of M/s. Tours & Travels. Is there any other formality to be considered by Mr. B.

    Please advise.

    Thanks & regards

    Ramanathan

  • Raj

    Hi Mukesh

    I wanted to ask whether i can start my proprietorship business from the Government Quarters where i m living currently as i m a govt employee

  • samir kadia

    respected mukeshji

    i read tour blog and understand lot of about propritership firm

    i m facing big problem if you guide me i m very much thankful to you

    my quetion is as under:::::

    i taken 4 laks rupees from one of propritership owner as deposit in my name we are very close friends after keeping his money about 2 years one day he call me that he is is serious problem and need urgentlly his money back as he givem ne through cheque and that time i also given hin cheque of ruppes 4 lakhs with no date as assurance

    as he wants his money back i told wait for couple of days i will give u back but he insits when u needed i gave u now i m in big trouble please give me back that cheque entry we will settle down later as we r very close friends and residing in same society i trust him and without any dought i given him his 4 lakhs ruppes back without taking any wriitten document sir this is fact i m not lier

    as i given his money back next morning he is expired due to heart attack he has 3 sons i m with his famaly after 2 days i told his son that i given that money to u r father no one beleives in me after lot disction they r 50 persent convimced but very next 7 days his middle sons wife commited suiside and mention his middle sons ,her mother in law s and elder sons wife name in suiside note as they r harrasing for drawery and she died. then to put free all this 3 person they expence alot as advocates fees and police department and they come to debt and suddenlly after 2 year they deposit my given check to there firm and propritership firm owner name of his wife (to whom i taken money his wife) as he expired suddnlly i not think he did any will to nominate his wife name i m 99 persent sure that this propritership firm they open as new rejistration number

    so sir as i readed u r blog and what i understand my quetion is

    as i wriiten check to his firm name (propritership firm as he is died and if they taken a new number his wife have right to deposit that check in bank ? and she have right to file suits against me in act of 138 ?

    sir

    your valuable sujjestion regarding this matter i really thankful to you

    please waiting for u r reply

    thanks in advance

    samir

    • If sole proprietor died without any will then sole proprietorship firm no more exist after the death of sole proprietor. On the date of death if any liability of the firm exist it will be paid out of the property of the proprietor and if any asset remains after settlement of the liabilities should be distributed among the legal heirs of the proprietor. So in my view she have no right to file case u/s 138 on NI act. But if there is any liability exists, you are liable to pay that.

  • samir kadia

    respected mukeshji

    i read tour blog and understand lot of about propritership firm

    i m facing big problem if you guide me i m very much thankful to you

    my quetion is as under:::::

    i taken 4 laks rupees from one of propritership owner as deposit in my name we are very close friends after keeping his money about 2 years one day he call me that he is is serious problem and need urgentlly his money back as he givem ne through cheque and that time i also given hin cheque of ruppes 4 lakhs with no date as assurance

    as he wants his money back i told wait for couple of days i will give u back but he insits when u needed i gave u now i m in big trouble please give me back that cheque entry we will settle down later as we r very close friends and residing in same society i trust him and without any dought i given him his 4 lakhs ruppes back without taking any wriitten document sir this is fact i m not lier

    as i given his money back next morning he is expired due to heart attack he has 3 sons i m with his famaly after 2 days i told his son that i given that money to u r father no one beleives in me after lot disction they r 50 persent convimced but very next 7 days his middle sons wife commited suiside and mention his middle sons ,her mother in law s and elder sons wife name in suiside note as they r harrasing for drawery and she died. then to put free all this 3 person they expence alot as advocates fees and police department and they come to debt and suddenlly after 2 year they deposit my given check to there firm and propritership firm owner name of his wife (to whom i taken money his wife) as he expired suddnlly i not think he did any will to nominate his wife name i m 99 persent sure that this propritership firm they open as new rejistration number

    so sir as i readed u r blog and what i understand my quetion is

    as i wriiten check to his firm name (propritership firm as he is died and if they taken a new number his wife have right to deposit that check in bank ? and she have right to file suits against me in act of 138 ?

    sir

    your valuable sujjestion regarding this matter i really thankful to you

    please waiting for u r reply

    thanks in advance

    samir

    • If sole proprietor died without any will then sole proprietorship firm no more exist after the death of sole proprietor. On the date of death if any liability of the firm exist it will be paid out of the property of the proprietor and if any asset remains after settlement of the liabilities should be distributed among the legal heirs of the proprietor. So in my view she have no right to file case u/s 138 on NI act. But if there is any liability exists, you are liable to pay that.

  • My sole proprietorship business has main income from abroad. Do I have to pay Income Tax and Service Tax (for above 10lacs)? Can I only file IT-Return for the Income only in India?

    Thanks & Regards

  • My sole proprietorship business has main income from abroad. Do I have to pay Income Tax and Service Tax (for above 10lacs)? Can I only file IT-Return for the Income only in India?

    Thanks & Regards

  • dear sir
    my father owned a business it was a sole proprietor ship firm , my father died on 3rd of july 2010 . we his children want to continue the business . we are 8 (myself ,and 7 married sisters . i used to be the mandate holder , now with his sudden death , we are all confused on how to continue this business, we owe money to our suppliers,and customers also owe us money, how are we going to take control of all that. i consulted the CTO. but he says that the business has to be closed immediately and says that in no way we can continue the business in the same NAME , he asks us to surrender the firm , but to other questions i asked as the above he says he has no knowledge . we do not want to surender the company if we can . we want to continue it . please help us ? if we can continue the company with out surrender and closure how do we do it ? my sisters and my mother will give no objection letter, and if i have to close the company as no other way. then how do i get my suppliers paid for what they have supplied and how will i get money from customers we have supplied ? or i can start with the same name or new name of the same business after closing the old account.
    please help
    i anticipate your reply

  • Mubin

    Dear Mukesh,

    A great support from your blog. Much appreciated the information and suggestions provided.

    I have a query:

    I am starting a business as sole proprietor in India as a IT consultant to overseas clients. My Yearly income is aprox. 15 lac.

    Can I start two businesses giving two different premises and devide the receipt 7.5 lacs each for these two bisinesses.

    Do I have to still get the Service Tax number as although my total income is 15 lacs (which is above 10 lac) but there are two businesses generating 7.5 Lac each.

    I would appreciate your responce greatly.

    Thanks & Regards
    Mubin

    • The exemption limit of Rs.10 lakhs under service tax is per assessee not per business or per service. So if you divide the receipt will not escape you from service tax liability. But since you are providing service to the overseas clients, then you may eligible for exemption for export of services. Please check export of services rules.

    • i5th

      Hi Mubin,

      I would like to partner with your firm. Please let me know if you have such business opportunity.

      i5th

  • Mubin

    Dear Mukesh,

    A great support from your blog. Much appreciated the information and suggestions provided.

    I have a query:

    I am starting a business as sole proprietor in India as a IT consultant to overseas clients. My Yearly income is aprox. 15 lac.

    Can I start two businesses giving two different premises and devide the receipt 7.5 lacs each for these two bisinesses.

    Do I have to still get the Service Tax number as although my total income is 15 lacs (which is above 10 lac) but there are two businesses generating 7.5 Lac each.

    I would appreciate your responce greatly.

    Thanks & Regards
    Mubin

    • The exemption limit of Rs.10 lakhs under service tax is per assessee not per business or per service. So if you divide the receipt will not escape you from service tax liability. But since you are providing service to the overseas clients, then you may eligible for exemption for export of services. Please check export of services rules.

  • Thanks for the very useful information.. I would like to buy a loss making proprietorship concern having carried over loss.. will i be able to set off losses after i have bought it.. please clarify
    Thanks

    • Sole proprietorship is non transferable.So whatever losses incurred by the firm will not be allowed to the successor in case of transfer of business.

  • Thanks for the very useful information.. I would like to buy a loss making proprietorship concern having carried over loss.. will i be able to set off losses after i have bought it.. please clarify
    Thanks

    • Sole proprietorship is non transferable.So whatever losses incurred by the firm will not be allowed to the successor in case of transfer of business.

  • Bbboy

    Hello Mr.Mukesh Raj, Thanks for such a nice information. My query is very basic I think, I want to take a Sub-Brokership from one of India’s reputed brokerage house. Pls. let me know the following :-
    1) Can I use “Capital Services” with my company name i.e — XYZ Capital Services ??
    2) What will be my Designation in my propriter firm ? can i use President or MD etc.. ??
    3) As you must be knowing that sub-broking business if full of risk and liability, so pls. throw some light on this issue, that how can i manage the risk and liability in my propritorship firm ?
    4) If suppose i recruite some staff then what formalities i need to full fill with govt. authorities ? As a propritor firm.
    Thanks in advance
    Regards,

  • Vicky 143 Vicky

    Can a registered proprietership company be incorporated into a pvt. ltd..??

  • Vkkammar

    Good Forum

    I want to start a Computer training institute in Pune under sole proprietorship

    Do I need to get any license for this?

  • rajat

    Thanks for such useful informations.
    I have a confusion. Can a government(or private limited) employee start side business by sole proprietorship.

    • Srinivasulu.T

      government employee can not do businss other than job

  • Sachin Pallolam

    Great !!!!!!!!

  • Dear Mukesh je
    I want to start a new business in which I will supply bhujiya from one state to another state(in india), how much tax i have to pay for that?
    I also want to do packaging of bhujiya for that what are the rules & regulation.
    Right now i am a student.

  • Ahmed Ruhullah

    I need some advise. How do you find details of the owner of someone trading under a business name. Is there any registration of name requirement?? Ahmed

  • Deepti_2323

    very informative and basic idea for this topic ..helped me a lot …….

    thanks……………

  • Anbu1411

    For a sole proprietorship company startup i need a current account to be opened. pls cfm if i need to register with service tax authorities before requesting my bank to offer opening of a current account
    thanks
    anbu, bangalore

  • Kaajal_l

    Hi Mukesh,
    I am a housewife and I wanted to start some small business from home. I had afew questions. Firatly I plan to get artificial fashion jewelry from outside and sell it from home only maybe online. So in this case do i need to get any licenses?
    Also do you have any idea as about customs that will be applicable to getting these stuff from out of India??
    Second option is if I take a shop on rent in a market complex and wish to sell imported readymade garments. Does this fall under sole proprietorship business? If not/ yes what are the legal formalities I need to take care of to start this kind of work?
    I am really keen for the second option but am not aware of the licenses and legal documents required so kindly help me with the same.
    Thank you
    Kaajal

  • Vanathi

    Hi Mukeshji,
    My husband is already having a propietorship.Now he wanna do another business dealing with trading of electronic items.Now he wanna start a new proprietorship in my name to do such business.Can he do so? I dont have any expertise in such field.He is the one who is going to do the business.Just for name sake can I be the proprietor?

  • Happydeepigolucky9

    dear sir
    i am making a project on sole proprietorship i have question
    what are the future challenges faced in sole proprietorship business?
    i know only a little about the challenges i need a detailed explanation so that i can understand it properly and make my project more clear so that i can tell other people about it.
    Please help me.
    thanking you
    sarika

    • Shankar

      hai
      you must be liable to pay ifany debts rise

  • Hgpatel4u

    want to start a sole proprietor firm in PHARMACEUTICAL SECTOR, can u advice me what r the necessary requirment and criteria to start it?

    1. Want to start as a proprietor, but I want to register trademark for my company.
    2. Can I get bank account on company name.
    3. How do I legally register a company
    4. In future can I convert my company to pvt.ltd
    5. My website will be ready by next month and I want to take all my payments in company bank a/c.
    6. I am presently working for a pvt.ltd company, so can I start the company on my name??
    7. Tax will be on turnover or on PROFIT?

    Requesting you to help on above queries.
    awaiting for ur precious advice.
    with warm regards
    Hasmukh Patel

  • Namrata Patel

    Dear Sir,

    Kindly guide me as per indian law how many properitorship firm can be opened in the name of one person?

    • Anonymous

      There is no limit for number of sole proprietorship a person can run, so a person can run any number of sole proprietorship firms.

  • Bhishmthakur1988

    Dear sir,
    kindly suggest me i want to start housekeeping business within solo proprietorship plz guide me , what type documents are required for start this ,,,plz.

  • Poornima

    hi
    i ve started job consultancy at January but now (march ) i ve to go for job in govt sector . now i want to stop my business for 1 month than after i will handover this business to my sister , is this process will be legal , please suggest me

    thanks & regards

  • Can anybody start a business suppose with a name “STROKES PUBLICITY” owner of which is a sole proprietor as the TRADE LICENSE would denote and file the income tax under sole proprietor’s own PAN NO. or have to have a separate PAN NO. in the mentioned firm’s name? If the firm requires VAT & SERVICE TAX NO. can it be obtained also? Will remain grateful if you would guide me.

  • Deveshshah

    Kindly guide me as per indian law how many properitorship firm can be opened in the name of one person?

  • Ramakrishna

    hi ,
    i want to start a sole proprietor business related to educational institute, can u advice me what r the necessary requirment and criteria to start it?

    1. Want to start as a proprietor, but I want to register trademark for my institute.
    2. Can I get bank account on institute name, i.e. trademark name
    3. do I need any other licence to start
    4. In future can I convert my company to pvt.ltd
    5. My website will be ready by next month and I want to take all my payments in institute bank a/c.
    6. how do i file tax as business income or any specific things i need to follow.

    Requesting you to help on my query.
    awaiting for ur advice.
    with warm regards
    reddy

  • Garima Agrawal

    Good Day Sir,

    I have few questions. I just want to start export import business in India. Can I register as a sole proprietorship company or else which one is the best.

    Right now I am just starting my business..so its not on very big scale. Right now I live in South America. Is it possible I can still register company on my name and for signing the document I can authorize my father?

    I want to export some stuff from india and for that I am having some payment issue. because to export the stuff billing must be on the firm name from which we will buy the stuff and that person must have export import license. I dont have export import license yet. If I buy stuff from exporters in India than they also need to show like to which company they have sell their products to export.

    Its kind of confusion for me. What I want to do, I just want to bring some stuff from India as a trial. If it works I can register a company later.

    But the billing problem is coming as this is the rule in India. So what can you advise me best? Should I open a company as sole proprietorship or you can tell me any other temporary solution.

    Kindly advise me asap.

    Thank you,

    Best Regards,

    Garima Agrawal
    garima.rga @gmail:disqus .com

    skype: garima.rga

    • Anonymous

      Ms. Garima,

      As you want to test the market for your products in South Africa, it will be better to start a sole proprietorship. But as you are not present here in India, it will be difficult to start a sole proprietorship without physically present here in India. So either you register the firm in the name of your father or else or visit personally here in India.

      Mukesh
      Sent from BlackBerry® on Airtel

  • Anwita Mittal

    Dear Sir,

    I am currently working as freelance HRD & Training Consultant. I wish to start a proprietorship firm in Bangalore and I expect to generate revenues around 6-7 lacs pa. My area of work will include providing service to clients in training programs and HRD assignments.

    Would request you to kindly suggest the procedure to go about it and what license/registrations other legal aspects would I need to take care of.

    Thank you for your time.

    Warm regards,
    Anwita

  • would you quote relevant registlation

  • would you quote relevant registlation

  • Kapilok

    I plan to open a proprietorship firm in the name of my wife. Opening a current account with ICICI requires various formalities, registration etc. It should be possible to operate banking transactions through the proprietors savings bank account? Do you see any issues with this approach.
    Thanks,
    Kapil

  • Kapilok

    In case of proprietorship, for IT returns, is it required to have separate P&L, Balance sheet for proprietor (individual) and company?

  • Kapilok

    Will IT accept returns of proprietorship biz. when company is not registered nor has current account?The company has cash collection only for which savings a/c of proprietor will suffice.Proof of doing business will be Franchisee agreement, receipts, bills etc.Please advise.

  • Sanjay Verma

    Sir,

    Kindly let me know as to what would be the status of the proprietorship firm if the sole-proprietor dies suddenly without any will etc? Who and How would be elligible to own the firm after the sudden death? What would be the shortest way of undergoing the formalities? The firm being a civil construction firm has Crores of payments lying with the Govt. Departments and the firm has to pay Crores of Rupees to the market. How to proceed?

  • Tanvir Pathan

    I own a Sole Proprietor Company name Dhaani Group.  Is it possible to keep my company name as Dhaani Group Inc.!!!

  • Twlsvcs

    MY SON IS HAVING PROPRIETORSHIP FIRM ON HIS NAME.FROM NEXT MONTH HE WILL HAVE A JOB, IF HE WANT TO TRANSFER PROPRIETORSHIP BUSINESS ON HIS FATHERS NAME, CAN HE DO?WHAT PROCEEDURE TO BE DONE?

  • Thanks for the post, its very useful to me 🙂

  • Seshadrinathan Kumar

    I hold a M.E in Computer science and I want to do computer software development for overseas customers. In that case do I come undera Professional or Business cartegory Do I required to gumasta license.

    Please let me know

  • Sandeep

    Hi,

    I am opening a travel agency.I am not sure about the business type I must go for.I wanted something where I have the maximum tax benefits and less tax liability.I might plan to add my father in my business( not yet decided )Something that I can pass on to my kids once I am not there.
    Please guide me properly so that i can move further in a safe a secure manner.
    The funds are limited and I dont want to enter into a something where I am just spending for my incorporation and the main domain for which I am starting this business gets neglected.
    I have read about Sole Proprietorship that is tax as an individual however Profit Sharing gets taxed at the same time LLP the Profit Sharing is not get taxes however the income tax is flat 30.90%… so all this confusing me a lot.In a travel business the maximum transactions are on cash basis e.g. the Agencies that are not IATA certified get the tickets issued though a IATA certified Travel agency and the those agencies charge everything in cash.The reason for that is very simple as they issue the tickets for a non IATA travel agency thus once the tickets get issued the charge becomes non refundable from airlines end thus to be on safer side and avoid any post issuance cancellation done by the non IATA travel agency, they make it sure that there money remain safe.

    Please help and guide me to decide that should I opt for.I would appreciate of someone can call me. I got to know about you from one of my friend and on the basis of that and keeping faith on your genuineness I want a help from you.

    Thanks & Regards

    Sandeep Mamgain
     

  • Vasundhara K25

    Hello,I owned a sole propritory business ,which went under loss,& I was’nt able to pay the salary of my employees and the clients fees .I went under terible loss & now the are informally harssing for payments thru some police sources.
    1 what can I do legally?
    2 can they file complain againts me?
    3 wht is your course of advise ,kindly help

  • Amit

    Hi,

    I’m developing mobile games & selling them on some website. Some of my games are free but they contain advertisements which are displayed to users & i get money from the advertisement company. What type of registration should i do? Is this type of income taxable?

    Please provide answers related to indian laws. Is it required to get a IEC code for providing these kind of services??

    Thanks & regards,
    Amit

    • Anonymous

      Yes, if you are a indian resident then all such income is taxable. There is no specific registration is required to receive these money except Income tax PAN. Further no IEC code required, if you are not exporting or importing anything.

      Sent from BlackBerry® on Airtel

    • Amit

      Thanks for your reply.

      I asked same questions on other forum & people say that you need to get a IEC code as you are providing advertising services to your company.
      Link to that forum: http://forums.digitalpoint.com/showthread.php?t=2295579

      please clarify this issue.

      Thanks & regards,
      Amit

  • Dear Mukeshji, 

    1) Can an NRI start sole proprietorship firm in India?2)Can I add the word “Corporation”” to my sole proprietorship firm”s Name? I have seen you reply to a previous query some three years ago that we can add Corporation. Is the law still the same ?

    Thanks in advance

  • Murali R

    Dear sir, What is the legal proof of Proprietorship of a firm. Does VAT certificate issued by the Commercial Tax Authorities valid proof of Proprietor ship in a matter concerning the courts of Law.

  • JAGADEESH

    hi

    If i want to start an investment company doing the business of trading in shares with the funds from friendsand relatives..which form of company can i float …is sole propertership permissible and whic other bodies do i need approval..thanks jagadeesh

  • SAIRAM

    MY FATHER WAS OWNER BUT HE IS NEW FIRM AND STYLE NAME JUST M/S BUT MG PARTNER IS OTHER PERSON BUT HE WAS ALL OF CHEATING OF MY FATHER SIR PLZ HELP ?

  • Akskumarsingh

    I am willing to start a proprietership  firm with the firm name, this firm will be service provider i.e – providing loans to the customers by taking DSA from various banks like- ICICI, HDFC, Axis Bank etc. what are the necessary formalities I have to do in this case. what will be the tax liability on me?

    Jyoti

  • I.N.Chatterjee.

    I have a Cyber Cafe under proprietorship. I like to appoint a Computer Hardware Engineer as  my working partner who will look after the major job. He has no capital to Invest. 
     Can I appoint him as a working partner?  

  • govind bhartiya

    my father is having a proprietorship firm on his name. can it be transferred in my name.

    • mukeshraj

      No, one of the biggest drawback of the sole proprietorship is non transferable. You can setup your own firm even in the same name & style as your father. You can do same business with same name with same parties but in a different firm. Sent from BlackBerry® on Airtel

  • Kamal mehta

    I have a similar question regarding change/transfer of proprietorship.
    I am a proprietor of two firms both into services.
    For Firm A- I am registered for service tax,although because of its turnover it does not fall under the purview of the same.
    For Firm B -No service tax registration-Turnover is negligible
    Both firms are running in loss,however I want to continue in the hope of a turn around sometime.
    I wish to transfer the proprietorship of both firms in my wife’s name.
    I do not want to create a partnership or pvt ltd company.
    Kindly advise on the following:-

    Process-  Sale/Gift/Book/Paper transfer
    Bank Accts-How the change to be affected?
    Service Tax:-Closing the one in my name? Whether a new one required in my wife’s name or not in view of turnover?

    Thanks & Regard
    Kamal

    • mukeshraj

      There is no process of transferability of sole proprietorship. New Proprietor has to registrar a new firm and old proprietor shall close his business and old proprietor can transfer his all assets and liabilities through an agreement to the new proprietor. But there is no process of transferring of business as whole.

  • RAMIZ MOMIN

    Sir, i have a plan to start Chemical Process Engineering firm(consulting firm). My current employer policy doesn’t allow me to strat it on my name. Can i start sole propritoriship firm on my wife’s name? Is it possible to transfer to it on my name in future?

    • mukeshraj

      Mr. Momin,

      Yes, you can start sole proprietorship firm in your wife’s name but transfer of sole prop is not possible.

      Mukesh

  • anand misra

    can an employee become sole proprietor?

  • arnav agarwal

    help me by giving more information on sole 
     Proprietorship

  • Muskan H

    Is it mandatory for a sole proprietor Consultancy firm to register with Chamber of commerce?

  • Suhas

    Hi Mukesh,
    Can you tell me if there is any upper limit to the company expense tax deduction and if it comes under 80C deduction or not.
    Suhas

  • Guest

    Hi Mukhesh,

    I am the sole propreitor of my company (X). Very recently I found out that on my website it is written in one corner of the page as a “…..copyright of X Pvt ltd” Does it have any legal implications?

  • Antony

    For the sole proprieter ship or partnership concerns, is it ok to name ends with Inc., For example Raj Inc

    • Yes, you can use any name which not a trademark registered by any other.

  • Sharad prem

    Hello sir, I would be grateful if you could answer my query as well. My father has been running a nursing bureau for the last 20 years and I have been assisting him with it. Presently he is not keeping well and wants to transfer the ownership in my name.Could you please guide me about the procedure. Thanks.

  • heera

    hello,

    can any one tell that:

    I am a sloe proprietor running business in rajasthan, now want to transfer this business to my brother-in-law. so is there any Capital Gain, and what is the procedure for such transfer. pls rpy