What is a Sole Proprietorship Firm

There are various types of business organizations, out that the most popular is that a “Sole Proprietorship Firm”. This is the easiest form of a business organization to operate and form. This is not a single man show, it’s just a single owner who is the man responsible for the business decisions and enjoys the comprehensive profit and bares the entire loss.

(Single Owner, who is the investor, who is responsible for the profit and loss and he is the only person on decision making)

Characteristics of a Sole Proprietorship Firm

• Easy to form the business
• Complete personal liability
• Sole decision making
• Solitary investor
• Easy to close the business
• No minimum capital required

How to register a Sole Proprietorship Firm

As already said, there is no legal requirement to register a Sole Proprietorship firm. But there are certain circumstances where we need to prove the existence of the business, for example, opening a Current Account. In those circumstances, we need to provide the proof of existences; What may be the proof of the existence

• MSME Registration
• GST Registration
• Shop and Establishment Registration
• IE Code Registration

How to Open a Proprietorship Current account

RBI had laid down KYC Norms (Know Your Customer) for opening a bank account with any National or Private Bank.  Following are the proof which satisfies the KYC norms.

• Address proof of the proprietor
• ID Proof of the Proprietor
• PAN Card of the Proprietor
• Rental Deed
• Any one Government Registration Certificate:
  1. Udyog Aadhar Registration Certificate
  2. GST Registration
  3. Shop and Establishment Registration
  4. Other domain based Registration certificates

Sole proprietorship firm is nothing but an Individual’s business. Unlike Private Limited or partnership, a proprietorship firm does not have a separate pan card. Hence the Pan Card of the Proprietor need to be utilized for opening a Current account and for other registrations.

Advantages of a Proprietorship Firm

• Easy to Form
• Easy to Manage and Operate
• Tax benefits
• Easy Decision making