Sole-proprietorship is the form of business, which is owned, managed and controlled by an individual. It is the oldest and simplest form of business, established with the limited resources, ability and capital.
The individual entrepreneurship is the form of business organization in the head of which stands an individual as the one who is responsible, who directs its operation, who alone runs the risk of failure.´
A sole proprietorship, also known as the sole trader or simply a proprietorship, is a type of business entity that is owned and run by one natural person and in which there is no legal distinction between the owner and the business. The owner is in direct control of all elements and is legally accountable for the finances of such business and this may include debts, loans, loss etc.
The owner receives all profits (subject to taxation specific to the business) and has unlimited responsibility for all losses and debts. Every asset of the business is owned by the proprietor and all debts of the business are the proprietor's. It is a "sole" proprietorship in contrast with partnerships (which have at least two owners).
The sole trader business is set up for the following objectives:
Sole trader business helps people to create work for them. Instead of looking for a job outside, a person can start his own small business.
A person having surplus funds may start sole proprietorship to make productive use of his funds. If the funds are small and not enough for a big business, it is better to set up a small business instead of keeping the funds idle. Sole proprietorship enables the owner to have full say and complete control over the business.
Sole trader business provides opportunity for an independent and honourable living. The sole trader is his own master and frees to take all the decisions.
A sole trader comes in direct contact with his customers. Therefore, he can better understand and serve the consumers. Sole trader business can be set up nearest to consumers so that they can buy their daily necessities conveniently.
Sole trader business helps in the distribution of income and wealth among a large number of people. It avoids monopoly and concentration of wealth in a few hands.
Sole proprietorship firms are usually small in size. These units provide ancillary service to big firms.
Key Features of Proprietorship Firm:-
Some important licenses you may need for starting a sole proprietorship firm in India:-
Permanent Account Number (PAN) is a ten-digit alphanumeric number, issued in the form of a laminated card, by the Income Tax Department. It is mandatory to quote PAN on return of income, all correspondence with any income tax authority.
A typical PAN is AABPS1205E
A complete overview of pan card can be seen at –http://www.incometaxindia.gov.in/pan/overview.asp
New PAN CARD application – https://tin.tin.nsdl.com/pan/
Tax Deduction Account Number (TAN) is an alphanumeric number issued to individuals who are required to deduct tax on payments made by them under the Indian Income Tax Act, 1961. The Tax Deducted at Source on payments made by assesses has to be deposited under the following number to enable the assesses who have received the payments to claim the tax deducted in their income tax return. So TAN is the abbreviation for Tax deduction and collection Account Number.
Application for tan card – https://tin.tin.nsdl.com/tan/
GST Registration Number is 15 Digit identification number which is allotted to each applicant. its a completely based on the Pan Number and State code. First two digit represent the state code and another 10 digit represent the Pan number of the client, One digit represent the entity code (Like Proprietorship firm or partnership , Private Limited etc, and other digit is Blank, Last digit represent check digit .
ADVANTAGES OF SOLE PROPRIETOR: -
The sole proprietorship form of business organization has certain merits. There are given below:-
DISADVANTAGE OF SOLE PROPRIETORSHIP: -
We provide the following registration with affordable price for a sole proprietorship business after receiving the requisite documents:
1) Obtaining PAN card for the Individual proprietor.
2) Obtaining TAN for the Individual proprietor.
3) GST registration all over India.
4) Opening of current bank account in the name of the sole proprietorship business.
5) Maintenance of books of account for the sole proprietorship business.
6) Filling of Income tax return, GSTreturn and TDS return if any.
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