What sets us apart?1000+ companies incorporated
30+ years in business
300+ trusted reviews
1000+ companies incorporated
30+ years in business
300+ trusted reviews
1000+ companies incorporated
30+ years in business
300+ trusted reviews
1000+ companies incorporated
30+ years in business
300+ trusted reviews
Register Your
Sole Proprietorship
in India
Enjoy a hassle-free online registration experience
tailored for first-time entrepreneurs
and small business owners.
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Brands that trust us
Over 1000+ companies incorporated in last 30 years
Right Plan for Your Business
Business setup made simple. Just as it should be
₹999
- MSME / Udyam registration
- Expert Assistance from Chartered Accountants
₹4,999
- Expert Assistance from Chartered Accountants
- MSME / Udyam Registration
- GST Registration
- GST Certificate
₹9,999
- Expert Assistance from Chartered Accountants
- MSME / Udyam Registration
- GST Registration
- GST Certificate
- ITR Filing
Don't just take our word for it.
Hear why countless entrepreneurs
choose Taxocity.
Starting a business in India can feel overwhelming with so many legal and compliance requirements — but Taxocity made it look easy. From the very beginning, they guided me through every step. Thank you, Taxocity, for making business setup so seamless!
Aromatics India Pvt. Ltd.
Got my company incorporated with the help of Taxocity. The entire process was handled professionally, and they kept me updated at every step. Highly recommended.
Head of Finance, Hugel Infra Pvt. Ltd.
Highly recommended! I used Taxocity for my ITR filing this year and the process was super smooth. The team was responsive and cleared all my doubts quickly. Filing taxes has never been this stress-free!
We engaged Taxocity for end-to-end company incorporation. The team demonstrated exceptional domain knowledge throughout the incorporation process. Their support didn’t end at incorporation; we have since retained them for ongoing statutory compliance.
PCI Infra projects Pvt. Ltd.
Starting a business in India can feel overwhelming with so many legal and compliance requirements — but Taxocity made it look easy. From the very beginning, they guided me through every step. Thank you, Taxocity, for making business setup so seamless!
Aromatics India Pvt. Ltd.
Got my company incorporated with the help of Taxocity. The entire process was handled professionally, and they kept me updated at every step. Highly recommended.
Head of Finance, Hugel Infra Pvt. Ltd.
Highly recommended! I used Taxocity for my ITR filing this year and the process was super smooth. The team was responsive and cleared all my doubts quickly. Filing taxes has never been this stress-free!
We engaged Taxocity for end-to-end company incorporation. The team demonstrated exceptional domain knowledge throughout the incorporation process. Their support didn’t end at incorporation; we have since retained them for ongoing statutory compliance.
PCI Infra projects Pvt. Ltd.
Starting a business in India can feel overwhelming with so many legal and compliance requirements — but Taxocity made it look easy. From the very beginning, they guided me through every step. Thank you, Taxocity, for making business setup so seamless!
Aromatics India Pvt. Ltd.
Got my company incorporated with the help of Taxocity. The entire process was handled professionally, and they kept me updated at every step. Highly recommended.
Head of Finance, Hugel Infra Pvt. Ltd.
Highly recommended! I used Taxocity for my ITR filing this year and the process was super smooth. The team was responsive and cleared all my doubts quickly. Filing taxes has never been this stress-free!
We engaged Taxocity for end-to-end company incorporation. The team demonstrated exceptional domain knowledge throughout the incorporation process. Their support didn’t end at incorporation; we have since retained them for ongoing statutory compliance.
PCI Infra projects Pvt. Ltd.
Starting a business in India can feel overwhelming with so many legal and compliance requirements — but Taxocity made it look easy. From the very beginning, they guided me through every step. Thank you, Taxocity, for making business setup so seamless!
Aromatics India Pvt. Ltd.
Got my company incorporated with the help of Taxocity. The entire process was handled professionally, and they kept me updated at every step. Highly recommended.
Head of Finance, Hugel Infra Pvt. Ltd.
Highly recommended! I used Taxocity for my ITR filing this year and the process was super smooth. The team was responsive and cleared all my doubts quickly. Filing taxes has never been this stress-free!
We engaged Taxocity for end-to-end company incorporation. The team demonstrated exceptional domain knowledge throughout the incorporation process. Their support didn’t end at incorporation; we have since retained them for ongoing statutory compliance.
PCI Infra projects Pvt. Ltd.
Sole Proprietorship
Advantages
Checklist
Eligibility
Documents
Fees
Process
Difference
Tax Implications
FAQ
Overview
A sole proprietorship firm is a simple and popular business structure in India, ideal for individual entrepreneurs and small businesses looking for a low-cost setup. In this model, there is no legal distinction between the owner and the business, meaning all profits, losses, and liabilities directly affect the proprietor. The sole proprietor has full control over operations, decision-making, and can hire employees if needed. However, the owner also bears unlimited liability—putting personal assets at risk in case of business debts—making this structure more suitable for low-risk ventures. To legally establish a sole proprietorship in India, key tax registrations like GST (Goods and Services Tax) are often required, especially if annual turnover exceeds the prescribed threshold. Depending on the business location and type, licenses such as the Shop and Establishment Act license may also be necessary.
Advantages of Sole Proprietorship
A sole proprietorship is one of the simplest and most common forms of business in India. Below are the key benefits of registering a sole proprietorship:
Easy to Start and Low Compliance Requirements
A sole proprietorship is generally inexpensive to start compared to other business structures like corporations or LLPs.
Tax Benefits and Savings
Sole proprietorships are taxed as individual income, which can result in lower tax liability. In some cases, proprietors may also be eligible for deductions up to 20%, helping reduce their overall tax burden.
Direct Customer Relationships
A sole proprietorship enables close interaction with customers. The proprietor can address feedback directly, build trust, and develop strong, personalized client relationships—especially important for service businesses and local shops.
Complete Control and Quick Decision-Making
The sole proprietor has full ownership and control over business operations. This allows for faster decision-making without the need for approvals from partners or a board. It's ideal for small business owners, local traders, and service providers who value autonomy.
Flexibility in Hiring Employees
Sole proprietors can hire employees or work with independent consultants. These consultants provide input as recommendations, allowing the owner to retain control while still gaining expert support when needed.
Checklist for Sole Proprietorship Firm Registration
The checklist for registering a sole proprietorship in India are:
- •Choose a perfect company name for your sole proprietorship business
- •Get Registered as an MSME
- •Procure required license including FSSAI license or shop and establishment Act license
- •Based on the business requirement you can register for ESIC or EPFO
- •Open a Business Bank account in the trade name. (Optional)
- •Obtain all the required certification under Shop and Establishment Act of 1947 (if applicable).
Eligibility Criteria for Sole Proprietorship Registration
The eligibility criteria for sole proprietorship registration are:
- •The applicant should be above 18 years.
- •The applicant should be an Indian Citizen.
- •They should have the legal capacity to enter into a contract.
- •The proprietor should not have any legal disabilities.
- •Applicant should not be declared bankrupt or convicted for a felony previously.
- •The purpose of the business should be clearly outlined while starting a sole proprietorship.
- •The business should be a lawful activity and should prevent selling illegal goods and services.
- •The business should have a unique name that was not registered previously.
Documents Required
To register a sole proprietorship in India, the following documents are generally required:
Personal Identification Documents
- •Aadhaar Card of the sole proprietor
- •PAN Card of the proprietor
Business Address Proof
- •Address proof of the business location
- •Rental agreement (if operating from a rented property)
- •No Objection Certificate (NOC) from the landlord (if applicable)
- •Utility bill or sale deed (if the property is self-owned)
Business Registrations (if applicable)
- •MSME/Udyam Registration Certificate
- •Shop and Establishment Act License or Trade License
- •GST Registration Certificate (if applicable based on turnover)
Ready to start your sole proprietorship?
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Registration Fees
To start a sole proprietorship in India, the costs may vary based on the business location, type of registration, and licenses required. Here’s a general fee breakdown:
Registration Process
There are four steps to register your sole proprietorship in India:
Register your Business Name
Consult our legal experts and choose a proper name for your sole proprietorship. Our team will assist you in registering your business name.
Get your PAN, GST, and MSME Registration Done
Our team will help you get your Udyam registration certificate and GST registration done in one go!
Obtain Shop and Establishment Act License
Submit all the required documentation, and we will file the registration form for your sole proprietorship.
Open a Current Account
After business registration we will assist you in opening an instant zero-balance current account. Our team also provides GST, ITR annual filing, and trademark registration support.
Legal Status of Sole Proprietorship
According to the law, an individual owns a sole proprietorship, which is an unincorporated business structure. The legal status of a registered sole proprietorship form in India is outlined below:
It Is Not a Separate Entity From the Business Owner
Unlike other business structures, a sole proprietorship doesn't have the power to function as a separate legal entity. As a result, you cannot register any assets under the name of the sole proprietorship.
It Can Sue, or Get Sued Only by the Owners Name
The owner or sole proprietor has the power to run a sole proprietorship. The company cannot be sued; only the owner can be sued in case of any litigation
No Legal Formalities to Create Sole Proprietorship
Apart from the required licensing to conduct the business, there are no complex legal formalities to register a sole proprietorship.
It Is Not a Taxable Entity
Since a sole proprietorship doesn't have any legal identity, it cannot be treated as a taxable entity. The funds generated by the sole proprietorship will be taxed under the proprietor's name.
Compliance and Tax Requirements
Running a sole proprietorship in India comes with certain legal and tax responsibilities. Here are the key compliance obligations every sole proprietor should be aware of:
Income Tax Filing
The business owner must file a personal income tax return using the form ITR-3 or ITR-4 for income tax compliance.
PAN Registration
It is mandatory for the sole proprietor to have a Permanent Account Number (PAN). The same PAN is used for all tax filings, including income tax and TDS, as the business is not a separate legal entity.
TDS and Quarterly Returns (If Applicable)
If a proprietorship has employees or transactions beyond a certain threshold, TDS returns must be filed quarterly.
GST Registration and Returns
If the annual turnover of the proprietorship exceeds:
- •₹20 lakh (₹10 lakh in special category states) for service providers or ₹40 lakh for goods suppliers,GST registration becomes mandatory. The business must file monthly or quarterly GST Returns, based on the scheme opted.
Difference Between Sole Proprietorship and Other Business Structures
Here is a detailed comparison between sole proprietorship and other business structures. Before registering your entity, it is crucial to consider the various business structures, their advantages, and how they suit your business activities in detail:
Tax Implications
The tax rate for sole proprietorships is the same as that of the owner prior to the establishment of the business. Instead of filing a separate business tax return, as a corporation would, they disclose their income and costs on their personal income tax taxes. Here is a complete outline:
Filing Income Tax Returns
A sole proprietorship is often taxed on its net income. This is the total revenue earned after deducting all the allowable deductions. This income is directly reported by the owner on their personal income tax return.
Goods and Service Tax
If the business is involved in selling goods and services, then it is subject to filing GST returns.
Employment tax or TDS returns
If the proprietor has multiple employees, then it is crucial to find TDS returns from time to time.
Financing Options
Irrespective of the business, financing is crucial for conducting the day’s activities. Here are two major options for funding a sole proprietorship company:
Personal Savings and Investments
In most cases, sole proprietorship financing is done by self-funding. But this doesn’t apply in all cases. You can also generate funds through family and relatives.
Business Loans for Sole Proprietors
Bank loans are the best options for procuring funds to grow your business. Sole proprietorship business loans are available across India in both traditional and digital banks. This will help you meet the funding requirements. In general, a sole proprietor can apply for both secured and unsecured loans. It is crucial to analyse the loan tenure, line of credit, invoice discounting, and other factors.
How Does Taxocity Assist With Sole Proprietorship Registration?
We provide access to top incorporation experts who will guide you through the complexities of sole proprietorship registration. Our professionals will coordinate with you to fulfil all your legal requirements. You can also track the progress on our online platform at all times.
Our team will handle all the paperwork and ensure a seamless, interactive process with the government. We provide clarity on the incorporation process to set realistic expectations. With a team of over 300 experienced business advisors and legal professionals, you are just a phone call away from the best in legal services.
Frequently Asked Questions
Why choose Taxocity?
Your trusted partner in business compliance and growth, empowering entrepreneurs with seamless legal, tax, and regulatory solutions since 1975.
With nearly three decades of experience, TaxoCity has evolved from a traditional tax consulting firm to a comprehensive business ecosystem. We’ve helped thousands of entrepreneurs transform their ideas into legally compliant, thriving enterprises while staying ahead of regulatory changes.
We believe complex compliance shouldn’t be a barrier to entrepreneurship. Our mission is to make business formation accessible, affordable, and transparent for everyone. Driven by integrity, expertise, and customer-centricity, we provide strategic guidance that supports your long-term success.
We offer a connected ecosystem that supports your entire business journey—from company registration and trademark protection to ongoing tax compliance and growth support. Our integrated team of experts provides holistic solutions that save time and ensure 100% compliance.
Get fast, affordable sole proprietorship registration with complete CA support. Start now.
India’s highest-rated legal tax and compliance platform.