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What is a proprietorship company in India?
A proprietorship company is a business owned and controlled by a single individual, and it does not have a separate legal identity from its owner.
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Is proprietorship registration mandatory in India?
Formal registration with MCA is not required, but basic registrations like GST, Udyam, or Shop and Establishment are needed to run the business legally.
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Who can register a proprietorship company?
Any Indian citizen with a valid PAN card and Aadhaar card who is above 18 years of age can register and operate a proprietorship.
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How do I register a proprietorship business in India?
You can register a proprietorship by obtaining Udyam Registration, GST Registration, or a Shop and Establishment License based on your business type.
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Do I need a business name for a proprietorship?
Yes, you can choose any business name, and it will be used for GST, Udyam, and bank account purposes, as there is no central approval process.
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Is a GST number compulsory for proprietorship registration?
GST registration is required only if your turnover exceeds the prescribed limit or if you sell goods or services across states.
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Can I open a bank account for my proprietorship?
Yes, you can open a current bank account using your Udyam Certificate, GST Certificate, or Shop and Establishment License.
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What documents are needed to register a proprietorship?
Basic documents include PAN, Aadhaar, address proof, business address proof, and additional documents depending on the registration type.
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Does a proprietorship require an audit?
Audit is required only if your turnover crosses the applicable income tax audit limits for the financial year.
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Can a proprietorship hire employees?
Yes, a proprietorship can hire employees, and the proprietor is responsible for their salaries, PF, ESI, and other labour compliances.
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Does a proprietorship need to file annual returns?
A proprietorship does not file annual ROC returns, but the proprietor must file an individual income tax return every year.
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Is Udyam Registration compulsory?
It is not compulsory but highly recommended because it provides MSME benefits, financial assistance, and business recognitions.
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Can a proprietorship be converted into a company?
Yes, it can be converted into a private limited company or LLP by following the prescribed conversion process.
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Does a proprietor have limited liability?
No, the proprietor has unlimited liability and is personally responsible for all business debts and losses.
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Is a proprietorship suitable for online businesses?
Yes, many freelancers, online sellers, and small service providers choose a proprietorship due to its simplicity and low cost.
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Can foreign nationals start a proprietorship in India?
No, only Indian citizens and residents can start a proprietorship, as it does not allow foreign ownership.
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How long does it take to register a proprietorship?
Registration timelines vary from 1 to 7 days depending on whether you are applying for GST, Udyam, or local licenses.
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Do proprietorships need to maintain books of accounts?
Yes, proper books of accounts must be maintained, especially if turnover crosses audit thresholds or GST registration is taken.
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What taxes apply to a proprietorship?
Business income is taxed as the personal income of the proprietor under the Income Tax Act based on applicable slabs.
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How does Ebizfiling help with proprietorship registration?
Ebizfiling completes all necessary registrations, prepares documents, assists with bank account setup, and provides compliance guidance for smooth business operations.