Sole Proprietorship Concern

Its talks about all the areas related to a Sole Proprietorship Concern. By Neha Shrimali

1. SOLE PROPRIETORSHIP CONCERN By Neha G. Shrimali “You Are The Business”

2. Definition: A business enterprise exclusively owned, managed and controlled by a single person with all authority, responsibility and risks.

3. Introduction: Also known as Sole Trader or simply Proprietorship. A Sole Proprietorship is a business established, owned and controlled by a single person. A sole proprietorship is still the oldest and the most common type of business in India . It comes in all shapes and sizes; its an extension of the Proprietor. The owner is responsible for all risks (such as losses, debt taken etc.) and rewards (profits). Out of all the forms of business entities it’s the simplest form. "John Doe, operating as Doe Painting, a sole proprietorship"

4. Liability of Business Debt:

5. Features: Details with respect to Sole Proprietor: Minimum and Maximum Number of People Only One Person, but it doe s not stop them from employing others. Separate Legal Entity/ Capacity to Sue No Separate Legal Entity. The proprietor and his business are the same in the eyes of law, hence the individual can sue or be sued. Ownership of property of the business Property belongs to the individual.

6. Features: Details with respect to Sole Proprietor: Charter Documents, Registrations required to start, Other registrations required are under the purview of separate legislations such as service tax, professional tax, PF, ESI etc. as applicable. None Capital Requirements Supplied wholly by the owner himself and he depends largely on his own savings and profits of his business. Termination or Continuity Dissolved on the death of the sole proprietor

7. Formation & Registration: Ease of formation is its most important feature because it is not required to go through elaborate legal formalities. No agreement is to be made and registration of the firm is also not essential. There is no formal sole proprietorship registration and to start a proprietorship. However to open a bank account for a sole proprietorship, any two of the following document must be submitted to the Bank:

8. Business Involved in Manufacturing or Trading: VAT Registration is a must for any person involved in manufacturing or trading activity. Therefore, he may obtain VAT or TIN Registration using the Proprietor’s PAN Card from the respective state government. Shop & Establishment Act License is required for businesses that operate a store or factory or formal place of business. It is often provided by the Department of Labour in the State and is required to operate a business in most states. MSME Registration is a registration provided to Micro, Small and Medium sized enterprises under the MSMED Act to promote small scale businesses in India.

9. Business Involved in Providing Services: Service tax registration: Businesses involved in providing services are liable to collect and remit service tax. Service tax registration can thus be obtained from the Service Tax Department to show the existence of a proprietorship business. However, once service tax registration is obtained, half-yearly service tax returns must be filed by the Proprietorship. Other registrations like shop and establishment act license or MSME registration or ESI registration or professional license can be used by the sole proprietorship to establish the existence of a proprietorship business.

10. THANK YOU