Sole Proprietorship Registration Archives

Sole Proprietorship vs OPC: Which One Is Right for Your Business? Introduction If you're planning to start a business alone, choosing between a Sole Proprietorship and an OPC (One Person Company) is a key decision. Both have unique legal, financial, and operational aspects. Knowing the difference helps you make a choice that supports your business goals. Summary Understand the difference between Sole Proprietorship and One Person Company (OPC) Compare features such as ownership, compliance, liability, and taxation Know which model suits small businesses or growing startups Learn the benefits and limitations of both types Find compliance requirements as per MCA and Income Tax Department Choose the best structure for your business needs What Is a Sole Proprietorship? A Sole Proprietorship is the simplest business structure, owned and managed by a single individual. It is not treated as a separate legal entity, which means the owner and the business are the same in the eyes of the law. What Is an OPC (One Person Company)? An OPC (One Person Company) is a hybrid business structure introduced under the Companies Act, 2013. It allows a single individual to enjoy the benefits of a company with limited liability and legal identity. You can validate from www.mca.gov.in Key Differences Between Sole Proprietorship and OPC Features Sole Proprietorship One Person Company (OPC) Legal Status Not a separate legal entity Separate legal entity Liability Unlimited personal liability Limited to the extent of share capital Registration No mandatory registration required Mandatory registration under MCA Taxation Taxed as individual Taxed as a private company Compliance Minimal Annual filings with MCA and Auditor Ownership Transfer Difficult to transfer Can be converted into Pvt Ltd Suitable for Freelancers, small traders Startups, single-founder companies What Are the Benefits of Sole Proprietorship? Easy to StartNo need to go through any long process or approvals. Just get local licenses like the Shop Act and start operations. Low Cost of OperationYou save on company registration, auditor fees, and ongoing compliance costs, making it cost-effective. Complete ControlYou’re the only decision-maker, allowing quick and flexible handling of business matters. Fewer Compliance RequirementsThere’s no requirement to file annual ROC returns unless your turnover mandates it under tax laws. Quick Decision-MakingAs there’s no board or partner, decisions can be implemented instantly, saving time and effort. What Are the Benefits of OPC? Limited Liability ProtectionYour personal assets are safe from business losses, debts, or legal issues since OPC is a separate legal entity. Separate Legal IdentityThe company can enter contracts, own assets, and sue or be sued in its own name, adding legal recognition. Better CredibilityHaving a registered company name enhances credibility with clients, banks, and suppliers. Easy to Raise FundsSince OPC is recognized under the Companies Act, banks and investors trust it more than informal setups. Conversion OptionAs your business expands, you can convert OPC into a Private Limited Company without shutting it down. We provide expert services for Proprietorship registration and OPC registration, simplifying the company registration process while ensuring compliance with all legal requirements. What Are the Challenges Faced in a Sole Proprietorship? Unlimited LiabilityIf your business defaults on loans or gets sued, you are personally responsible, even with your own savings. Difficult to Raise FundsMost investors and lenders prefer registered business structures and proper financial statements. No ContinuityIf the proprietor passes away or is unable to run the business, it typically comes to an end. Limited Growth PotentialThe informal structure lacks investor confidence, making scaling or expanding difficult. What Are the Challenges in Running an OPC? Compliance BurdenOPCs need to file annual returns, maintain proper financial records, and get audits done, irrespective of their turnover, as mandated under the Companies Act, 2013. Limited to One MemberYou can’t include co-founders or partners in the business unless you convert it into another form of company. Ineligibility in Some CasesOPCs can't be formed by NRIs, foreign nationals, or minors, limiting who can use this structure. Conversion RestrictionAs per the latest MCA rules effective from 1st April 2021, there is no mandatory threshold for the conversion of an OPC into a Private Limited Company based on turnover. The earlier limit of Rs. 2 crore turnover has been removed. Which Is Better for You? Sole Proprietorship is ideal for low-risk businesses, such as local shops, freelancers, or consultants. It’s affordable and needs minimal paperwork. OPC is best if you're planning for future expansion, want limited liability, and aim to deal with bigger clients or financial institutions. Evaluate your risk appetite, compliance readiness, and funding needs to choose the most suitable option. Step-by-Step Process to Register a Sole Proprietorship Choose a Business NamePick a business name that suits your work. It doesn’t require legal approval but should be unique and professional. Open a Current Bank AccountYou’ll need a bank account in your business name with supporting KYC documents like PAN, Aadhaar, and utility bills. Register under Local LawsGet a Shop and Establishment Act license from your municipal or local authority to legally run your business. Apply for GST RegistrationIf your turnover exceeds Rs. 40 lakh (goods) or Rs. 20 lakh (services), or if you do inter-state trade, GST registration is required. Get PAN and TANPAN is used for filing taxes. TAN is needed if you're required to deduct TDS (Tax Deducted at Source) under income tax rules. Step-by-Step Process to Register an OPC Apply for DSC and DINGet your Digital Signature Certificate (DSC) and Director Identification Number (DIN) from a certified agency. These are required to file forms digitally. Name Approval from MCAUse the SPICe+ Part A form on MCA portal to apply for and reserve your company name. Draft MOA and AOAPrepare the Memorandum of Association (MOA) and Articles of Association (AOA) which outline your business objectives and rules. File SPICe+ Part B and Linked FormsSubmit SPICe+ Part B along with required documents, AGILE-PRO, INC-9, and details of your nominee who will take over in your absence. Receive Certificate of IncorporationOn successful verification, MCA issues the Certificate of Incorporation which includes PAN, TAN, and the CIN of the company. Conclusion Both Sole Proprietorship and OPC offer benefits depending on your needs. Sole Proprietorship is simple and best for local or low-risk businesses. OPC provides limited liability, credibility, and legal recognition, making it suitable for ambitious entrepreneurs. Make your choice after considering your budget, compliance efforts, and future growth plans. Suggested Read : Form AOC-4 for OPC Annual Filing OPC Compliance Requirements AGM Provisions for OPC Form MGT 7A for OPC Mandatory Compliance List for OPC FAQs Yes, but it requires forming a new OPC after closing the sole proprietorship.Only if the turnover exceeds the prescribed limit or for inter-state operations.Yes, they must maintain books and get audits done as per MCA norms.No, only Indian residents are allowed to incorporate an OPC.It follows individual tax slab rates as applicable.OPCs are taxed at 22% plus cess under corporate tax laws, but this rate is applicable only if the OPC opts for the new tax regime under Section 115BAA.Yes, especially if annual turnover exceeds Rs. 2 crore.Yes, depending on business nature and local regulations.No, only individuals 18 years or older can operate a business.No, it’s restricted to one shareholder until it converts into a Private Limited Company.

For Indian Entrepreneur

For Foreign Entrepreneur

Special Entities

Tax Registrations

Other Registration

Returns

Annual Filings

Change Services

Closure

Legal Drafting

Special

Trademark

Copyright

Patent

Designing & Marketing

Blog

Sole Proprietorship VS OPC

How to Register Sole Proprietorship Firm in India?

Hi, Welcome to EbizFiling!

HOME

POLICY

RELATED LINKS

CONNECT WITH US

TOP 3 READS

Annual Compliance Calendar of LLP 2025-26

Role of IEC in International Trade: Future Trends

LLC vs INC : Difference between LLC and INC

Secure Payment Modes

GSTR 9 Annual Return Filing
Certificate of Good Standing in USA
Share Certificate Printing
Form 10F of Income Tax
Tax Residency Certificate (TRC) for US Entity
Tax Residency Certificate (TRC) for Indian Entity
Company Registration in Ontario, Canada
FSSAI Licence Modification
FSSAI License Renewal
Private Limited Company
US payroll services in India
UK Business Outsourcing Process in India
File CRF Form to change Master Data on MCA
Reply to Notice Under Section 148 of Income Tax Act
Reply to Notice u/s 143(2) of Income Tax Act for Scrutiny Assessment
Reply to Intimation Notice under section 245 of Incone Tax Act
Reply to Defective Notice u/s 139(9) of Income Tax Act
Reply to Income Tax Notice u/s 143(1)(A) for Prima Facie Adjustment
Reply to intimation notice of Section 143(1) of Income Tax Act
Reply to Income Tax Notice Under Section 133(6)
Corporate Legal Advice
LEI Code Registration
Employee Background Verification
US Business Solutions and Outsourcing Services in India
LLC Annual Compliances in Wyoming, USA
LLC Annual Compliances in Florida, USA
E-RCMC Registration under EPCES in India
Annual Filing & Bookkeeping & Accounting Service for Partnership Firm
ITIN Registration in the USA
Offshore Staffing Services in India
SEO Services in India
Content Writing Services in India
File Form 10BD Online under Income Tax Act
Annual Filing For Trust in India
Register a company in India from UK
Register a company in India from Germany
Register a company in India from France
Register a company in India from US
LLC Annual Compliances in Delaware, USA
Register a company in India from Canada
Register a company in India from UAE
Register a company in India from Singapore
Register a company in India from Australia
Company Registration in Indiana
Company Registration in California
Company Registration in New Mexico
Company Registration in New York
Company Registration in Texas
Company Registration in Wyoming, USA
Register Company in Florida, USA
Company Registration in Delaware
Annual Filing & Book-keeping & Accounting Service for Proprietorship Firm
Wall Designing
Virtual Office in India
Form 15CA Online Filing – Income Tax
NGO Darpan Registration
Overseas Direct Investment (ODI) through Automatic and Approval Route
HR Hiring and Recruitment Services in India
FLA Return Filing Online to RBI in India
APEDA (RCMC) Registration in India
ROC Annual Compliance for Producer Company
ROC Annual filing for Section 8 Company
ROC Annual filing for Public Limited Company
FCRA Registration Online in India
File Form CSR 1 online
Appeal to CIT- File an Appeal to Commissioner to Income Tax
Reply to Scrutiny Assessment Notice u/s 143(3)
Reply to Income Tax Notice- Know How to Respond to IT Notices
Surrender IEC License Online in India
भारत में कंपनी पंजीकरण / रजिस्ट्रेशन
Drop-Shipping Business in India by Foreigners
OPC Registration in India by an NRI
Company Registration in India- Know how to open a Company in India
Creation of Charge
LLP Registration in India by an NRI
Company Registration in India by an NRI
Right Issue of shares / Right Offerings
Renewal of IEC License
Application for the Extension of Name Reservation
Digital Marketing Services
Company Annual Filings in XBRL filing mode in India
12AA & 12A Registration Process
Trademark Registration / Brand Registration in the USA
Trademark Registration / Brand Registration in UK
Trademark Registration / Brand Registration in Malaysia
Strike Off Company
Payment of TDS return on purchase of property (form 26QB)
Business Advisory Services
Limited Liability Partnership Registration in Mumbai
Limited Liability Partnership
File ROC Form DPT 3 Return of Deposits
Income Tax Returns Filing
ROC Annual Compliance for Pvt Ltd Company
MCA Companies Fresh Start Scheme
LLP Annual Return Filing
MCA LLP Settlement Scheme 2020 (LSS 2020)
DIR 3 E KYC
ISO Certification in India
Run your operations / company in India without any liabilities
Add A Director
Accounting and Compliance Services for Start ups, Small companies, LLP and OPC (Micro Retainership Services)
Foreign Direct Investment through Automatic and Direct Route
Company registration in Bangalore
Apply for FSSAI license or Food license in India
Dormant Company Status Application
Trademark Registration in India
Conversion From Registered Partnership To LLP
Conversion From Registered Partnership To Private Limited Company
Change in Registered Office of LLP
Company Registration in USA
Company Registration in Malaysia
Company Registration in UK
Logo Design Services
Conversion of Private Limited Company to OPC
Opening a Branch in India by a Foreign Company
Nidhi Company Annual Filing
One Person Company (OPC) Registration in Mumbai
IEC Registration in Mumbai
Trademark Registration in Mumbai
Private Limited Company registration in Mumbai
Form GSTR 1
Maharashtra Professional Tax
Premium Retainership Services in India
MicroFinance Company registration
Conversion of Section 8 Company to Private Limited Company
DPIIT Startup Recognition certificate
RBI Form FC-GPR
Charge Registration on property
RBI Form FC-TRS
EPF Registration
PAN Application
Digital Signature
IEC Registration
TAN Application
DIN Application
GST Registration
Nidhi Company
Producer Company
Hindu Undivided Family (HUF), HUF Deed
Sole Proprietorship Firm Registration
Public Limited Company
E-Commerce Business
One Person Company (OPC)
Partnership
Indian Subsidiary
Non Profit Organization
GST Returns
CMA Report Preparation
E-Form Commencement of business certificate(form-20a)
Private Limited Company Registration
Startup Advisory Services
One Person Company (OPC)
Private Limited Company Registration
Income tax section 80g(5) registration
Company Registration Process in India for Foreigner- Know How to Open a Company in India
Secretarial Compliance Services
Search Report ROC
Revival of Struck Off Company
Trademark Watch Services
One Person Company (OPC)
Limited Liability Partnership
GSTR 9C filing by CA- GST Annual Audit due date, GSTR 9C FAQs
Tax Consultancy Services
International Trademark Registration Under Madrid Protocol
Surrender of DIN
Trademark Registration Process
LLP Registration Procedure – copy
LLP Registration Procedure – copy
Online LLP Registration and Complete Procedure
Aadhaar Udyog Online Registration
New Form INC-22A
FIND GST RATE, HSN CODE & SAC CODE
Company Registration in India
Hire Purchase
Contract Manufacturing Agreement
Web Development Agreement
Sole Selling Agreement
Underwriting Agreement
Mortgage Deed
Agreement Appointing A Common Arbitrator
Deed of Wakf-Alal-Aulad
Specific Power of Attorney
Foreign Collaboration Agreement Drafting
Joint Venture Agreement
Non- Disclosure Agreement
Franchise Agreement
Agreement to Sell Business
Vendor’s Agreement
Exclusive Distributorship Agreement
Shareholders Agreement
Consumer Complaint Letter
Power of Attorney
Company Name Change
Appointment of Auditors
Removal/Resignation of Director
GST Cancellation
GST LUT Letter of Undertaking
Conversion from Private Limited Company to Limited Liability Partnership (LLP)
Business Plan Preparation (Project Report)
Book-Keeping & Accounting
Trademark Renewal
Trademark Opposition
Trademark Rectification
Trademark Withdrawal in India
Payroll Setup & Processing
ESI Returns
PF Returns
TDS Returns Revision
Removal of Charge
Modification of Charge
MOA/AOA Printing
MOA/AOA Amendment
IEC Modification
Change of Registered Office Address
OPC to Private Limited Company
Conversion of Sole Proprietorship to OPC
Sole Proprietorship to Partnership firm
Conversion from Proprietorship to LLP
Conversion of Proprietorship to Private Limited Company
Conversion of Public Limited Company to Private Limited Company
Private Limited Company to Public Limited
Conversion of Partnership to Private Limited Company
Conversion of LLP to Private Limited Company
Conversion of Partnership to LLP (Limited Liability partnership)
Del Credere Agreement
Lease deed
TDS Returns
Strike Off OPC
Dissolution of Firms
Strike Off LLP
ESIC Registration
GST Modification
OPC Annual Filing
SSI/MSME/Udyog Aadhar Registration
Share Transfer & Transmission
Change in DIN
Add/Remove a Partner in LLP
LLP Name Change
Change in LLP Agreement
Increase in Authorized Capital
Change in Directorship
Patent Registration
Patent Search
Provisional Patent
Copyright Application
Trademark Assignment
Trademark Objections
Trademark Registration
Trademark Registration – copy
Limited Liability Partnership
Conversion into LLP