Sole Proprietorship for Small Business Incorporation

About Sole Proprietorship for Small Business Incorporation

Get your private limited company incorporated with a very convenient process and get help from experts in the comfortable environment of your home or office.

Note – Charges are based on minimum government fees or structure state-wise. If there are additional services or extra government fees, then the same has to be borne by the service receiver.


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Frequently Asked Questions about Sole Proprietorship for Small Business Incorporation

Q1. What is a sole proprietorship?

When an individual is the single owner of a business then that structure of the business is called sole proprietorship. The literal meaning of this is a single owner.

Q2. What is the benefit of a sole proprietorship?
  • The most common structure of small business in India is a sole proprietorship.
  • It has the least number of regulations.
  • Most easy to start or shut structure.
  • Least cost involved in setting up, maintaining and closing the business.
  • Any name can be used until the name is trademark protected.
  • Simple tax structure.
Q3. What is a disadvantage of a sole proprietorship?
  • The owner is personal liability for all business deals.
  • Less credibility compares to other business structures.
  • The owner can not sell partial ownership of the business.
  • At the time of the death of the owner, there is a high chance of collapsing the business.
Q4. How to start a sole proprietorship?

There are not any specific laws or regulations to start a sole proprietorship. But registration can be made as per requirements and local regulations.

  • State Shop and commercial establishment – Any commercial establishment like a shop, warehouse, office, eateries, or theatre have to get registered under this act. And it is state-based so rules may differ from state to state. It has rules and regulations to secure the welfare of workers and employees.
  • MSME Registration – Any business including manufacturing and trading can be registered under MSME subject to some investment, and
  • GST Registration
Q5. Do I need to have a separate PAN number for Sole Proprietorship?

NO, your personal PAN number is also the PAN number of your business.

Q6. Can Sole proprietorship businesses convert into partnerships, LLP or companies?

Yes and No Because your business can change but legally it is more like you have shut your business and started a new firm.

Q7. How does income tax return work in sole proprietor when both PAN number is the same?

A separate calculation of income from the business is calculated and then added to the total income of the individual for taxability.

Q8. Does a Bank account is same for personal and businesses in the case of a sole proprietor?

You can have both ways. But it is recommended for accounting and taxation purposes to maintain separate accounts for the business and personal.

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