Proprietorship Registration in Bangalore Karnataka

Business GST ProfessionSeptember 27, 2018March 27, 2021 PATSON LEGAL

Know All About Sole Proprietorship Firm

Sole proprietorship can be called the simplest form of business. As such, a sole proprietorship is not a legal entity. The term is basically used to refer to owners who have their own businesses and in these cases they happen to be responsible for the debts incurred by their business as well.

Such a business can operate either under a name chosen by the owner or under the name of the owner itself. The name in these cases is just one intended for purposes of trading. It does not really mean that the business is a legal entity that happens to be separate from its owner.

There are several reasons as to why sole proprietorships have become as popular as they have been. As has been said already, this form of business is the simplest out there. It is also really easy to set up such a business and you need little money in order to set up such a company.

If you wish to register a sole proprietorship, all you need to do is register your name and get a license that allows you to do business in your immediate locality. One of the major issues of such a business though is that you are always held personally responsible for all the debts incurred by your business.

What is sole proprietorship firm registration?

It needs to be mentioned in this context that in India it is not mandatory for you to register your sole proprietorship business. Now you may ask why is it that you should get your sole proprietorship registered. There are two major benefits of such a step –

Your business gets a proper identity and
It gets a lot easier to open a bank account in the name of your business while it happens to be registered;

When you get your sole proprietorship registered your business would get a separate identity that would mark it out against other types of companies such as partnerships. One of the biggest issues of sole proprietorship is that it can be quite hard to open a bank account in the name of your business.

Normally these businesses do not really have any recognition from a government and this is what makes it so hard for owners like you to prove to banks that your business exists. Once you register your business it gets a definite identity from the government and thus it becomes a lot easier for you to open a bank account in the name of your business.

Advantages and benefits of a sole proprietorship

As a kind of business entity you get a number of benefits by starting a sole proprietorship. You would already know by now that these businesses are easier to start and you do not need a lot of money to start such a company.

This particular type of business also comes with a lot less regulatory compliance related requirements. It is also easier to name such a business as opposed to other kinds of businesses. Since you are the only owner in such a company you have complete control over the same.

It is also a lot easier to close a sole proprietorship company.

Such a company does not need to file any income tax separately. This is applicable even when you have registered it. All you need to do is file your individual tax return. In that you can easily disclose how much profits you have made from the business or how much loss you have incurred. Normally in case of partnerships a separate return has to be filed for the business.

However, if you have registered your business as per GST (Goods and Services Tax) then your return has to be compliant with GST requirements as well.

Coming to the costs of starting such a business they are basically next to nothing. The only money that you may have to spend in such a business is in order to get a license for your business.

It also needs to be mentioned in this context that since the compliance related requirements in these cases are minimal you can save a whole lot of money in that regard as well.

As has been stated already, it is pretty easy to name a sole proprietorship. You can give your company any name as long as you are not violating a trademark held by another company.

You can always start off your business with a unique name and once you feel you have earned a sufficient amount of goodwill you can get your company registered in that particular name.

Documents required for proprietorship registration

In order to register a sole proprietorship you need to furnish the following documents:

Self attested copy of your PAN (Permanent Account Number) Card
Self attested copy of your Aadhaar Card/ Voter ID/ Driving License (DL)/ Passport as address proof
Electricity bill and Rental agreement of premises where you want to setup your business (if it is rented premises)
Tax paid bill (if it is own premises)
Bank statement required for GST registration or MSME registration
Passport size photographs

How to register a sole proprietorship in India?

There are 3 ways through which you can register a sole proprietorship firm and get an ownership certificate in Bangalore or any other cities in India as per the business requirements.

Obtain a CA (Chartered Accountant) Certificate for Opening a Current Bank Account
Obtain a Labour Certificate from the State Labour Department (or Municipality)
Obtain a MSME/ GST Certificate Based on Nature of Business

Get a CA Authorized Certificate

In First, you have to obtain a Chartered Accountant (CA) Certificate for your business to open a Current Account in any nationalized bank. It is mandatory for every proprietor to acquire the CA authorization letter for his/ her business name.

Get a Labour License Certificate

Secondly, you shall have to register and acquire one Shops and Establishments registration license from State Government under the Karnataka Shops & Establishments Act, to give a legal name to your business.

If you have a shop that serves as your place of business you can register your sole proprietorship under the Shop and Establishment Act. In this case the term shop means a place where you sell goods on a retail or wholesale basis. It could also be a place from where you provide services to your customers. You can also go for this particular way if you have any of the following that you use for the purpose of business:

Office
Store room
Go-down
Warehouse
Workplace

In this case the application needs to be made to your local municipal body.

If you do not know how to register a sole proprietorship business in Bengaluru you need not worry on this regard as these days there are a number of companies that are willing to help you to register your company. You can be sure that they would help you in each step of the way.

We are also a leading company registration service provider in Bangalore offers various services in relating to business consultation; if you need our help, we will deliver you the best services on the basis of your requirements.

Get a MSME/ GST Certificate

And Thirdly, you can take a Central Government’s GST/ MSME registration certificate to avail the benefits and subsidies from them on the basis of SME criteria.

In case of MSME registration, you can register a sole proprietorship through Udyog Aadhaar (now it is changed to Udyam Registration) under the Ministry of MSME (Micro, Small and Medium Enterprises) of India. Udyog Aadhaar can be described as a unique identification number that is provided to business owners by the Ministry of MSME. Just like all other kinds of companies you can apply for an Udyog Aadhaar as well. Once you do this you would be eligible to receive all the benefits and facilities that the MSME Ministry provides. Apart from that this would provide your business a unique identity as well.

Or if you are getting registration under GST law, in this case your business is to get registered through GST. Normally you should apply for GST if you happen to deal in goods and services. As you may know, GST has substituted the old system of registering for service taxes and VAT (Valued Added Tax). This is indeed a great method in which to get your sole proprietorship registered. However, you also need to keep in mind that there are plenty of GST related compliance issues that you would have to adhere once you choose to go this way. For example you have to compulsorily take taxes from your buyers and then file the applicable returns.

Partnership Firm Registration Online in Bangalore Karnataka

Business Company Registration ProfessionSeptember 14, 2018October 25, 2021 PATSON LEGAL

Know All About Partnership Registration

A partnership firm is a kind of business organization. As such it is also regarded as one of the most important kinds of businesses out there. This is basically a kind of company where two or more individuals come together and form a business.

They decide to split the profits of the company as well but in a ratio that is mutually agreeable to all of them. It is quite easy to form a partnership company as the compliance related requirements are much lesser than other kinds of companies. The registration of such companies in India is governed by the Indian Partnership Act, 1932.

Normally there is no law that mandates the formation of such a company. It happens to be optional – it is up to you and your partners to decide whether you want to register your partnership firm or not.

But registering a firm under Partnership Act is always advisable which ensures that you get a legal proof of the firm’s existence where your customer could have a trust on your establishment.

Apart from this, the Act provides various benefits and rights to every partner like filing a suit in case of disputes, settling claim against third parties, etc.

So, it is always better to get your firm registered at Registrar of Firms/ Departments of the Regional State Registrar where you are planning to set up the business.

The best part of the registration process of such a company is that you can do it at any time of your choice – either before starting your business or after having started it.

Why are partnership firms so popular?

Partnership Advantages — Partnership Benefits

As has been said already, it is really easy to form partnership firms in Karnataka India as they need a lot less by way of compliance compared to other forms of a company. This is perhaps the major reason as to why these companies enjoy such a high degree of popularity.

Apart from that these companies have some taxation related advantages as well. If you register your business as a partnership company, you would not have to pay any business income tax as such.

As a partner you can file the losses you have incurred or the profits you have made in your personal income tax only. This means that your business would not be subjected to taxation as such.

With a partnership you have more than one source of funds, which always comes in handy especially when setting up a company.

What are the features of a partnership firm?

As opposed to a proprietorship firm; in a partnership there are at least two owners of a company is required. The maximum number of partner permissible is 10, in case of such companies in India; as far as banking work is concerned. However, if non-banking work is taken into account this number can go up to 20 as well.

As has been said already, the partnership company has good features for those who wants to run their business with full ownership. An agreement between the partners can spell out the profit or loss sharing, roles, positions and management among them. The thing with a partnership is that these contracts need not always be a written one – it can be an oral one as well.

Normally, a partnership business is created with the intention of doing some business in a lawful manner and also to share in the profits as well as the losses. Companies formed with a charitable intent are not partnerships.

In a partnership firm, you also have a greater amount of knowledge, wisdom, and resources to draw from. It has also been seen that these companies normally have lot more contacts as well. Since there is more than one owner in such a firm there is always a chance that the management could be better than a proprietary firm.

How to choose the name of a partnership?

There are a few things that you need to keep in mind while choosing the name of your partnership firm.

First of all, it should not be identical or highly similar to a company that is already in the same line of business as you wish to be in or are in. This is forbidden for the simple reason you could be damaging the goodwill or reputation of that particular firm by choosing such a name.

In secondly, it would also be better if the name of your partnership company does not contain words such as emperor, empress, crown, empire, or any other word that may come across as approval or sanction of the government. It should not in any way show that it is being patronized by the government.

Why should you have a partnership deed?

As it has been said already, a partnership deed in a partnership firm can be either a written one or an oral one. Normally, a partnership deed is a very important agreement in the sense that it contains the rights, profits, duties, shares, and other such obligations of each and every partner in such a company.

Section 4 of Partnership Act, 1932 defines that an agreement between the partners/ persons need to be agreed by all or any one of the members for sharing of profits up to how much from business carried on. And the registration of partnership deed takes care of all disputes as per the terms and conditions under which the partnership was formed.

The benefit of a written deed is that it serves as an inalienable record and thus comes in really handy at the time of any conflict in the future. Normally, when you make a partnership deed there are some general details that have to be included. They may be enumerated as below:

Name and address of your partnership firm as well as that of the partners
Capital that each partner is supposed to contribute
Nature of business
Profit and loss sharing ratio among the partners
The date when the business started

Apart from these some specific details should be there in the partnership deed as well as they would also help avoid any conflict during the later stages. You need to mention the interest applicable for the capital that has been invested in the firm, interest for any loan that a partner may have provided to the firm, and interest on drawings made by partners. The commissions, salaries, or any other amount to be paid to the partners need to be mentioned in the deed as well.

The partnership deed should contain details on the rights of each partner. This should also include the extra rights that only the active partners would be eligible for. The obligations and duties of the partners need to be mentioned as well. This deed should also contain the processes and adjustments that have to be adhered to when a partner passes away or retires from the firm.

Partnership firm registration process

Through the below steps a business can be perfectly registered as a partnership firm:

Choose a unique partnership name
Prepared an agreement or deed for partnership business
Register the business in Regional Registrar of Firm and obtain the certificate
Apply PAN for your business name
Open a current bank account in the name of business

How to register a partnership firm?

If you want to know how to form a partnership firm in Bangalore, you need not worry as we are expert in this domains, providing business solutions to overcome the problem you faced and more than that we are ready to help you. If you need our assistance in this matter, we would always be happy to help.

The application form in this case needs to be submitted along with the required fees. Normally in these cases the Registrar of Firms should be of the state where you wish to do business. You also need to make sure that the application contains the signatures of all the partners. At least their agents should sign the same.

Necessary documents required to register a partnership?

Following are the documents that you need to provide to the Registrar of Firms while registering your company as a partnership firm:

Application registering the partnership – Form 1
Certified original copy of the partnership deed
A specimen of the affidavit
Proof of the central location of business – in this case you can provide lease or rental agreement or ownership papers as well
Identity proof of partners – PAN Card, Aadhaar, Voter ID, Passport
Address proof of partners – Electricity Bill, Mobile/ Phone Bill, Bank Statements (not older than two months)
Stamp duty of appropriate value through Stamp papers
Photographs of all partners

If the Registrar happens to be satisfied with all the documents that have been furnished by you she or he would register your firm in the Register of Firms and would issue your Certificate of Registration as well. The Register of Firms has all the latest information on each and every partnership firm working in a state. However, in order to be able to view it you have to pay a certain amount of fees.

One Person Company (OPC) Registration in Bangalore India

Business Company Registration ProfessionSeptember 4, 2018October 18, 2021 PATSON LEGAL

How to Register a One Person Company in India?

While an entrepreneur or a business owner is going to register an OPC company in Bangalore or any other cities in India; he/she should have to aware and know the most important things related to it such as features, advantages, reasons, requirements, documents, process and time and cost involved in registration. That’s why in this article, we discuss the key points which is most essential to get started a one person company in India.

Introduction to OPC

The concept of a one person company (OPC) was brought out as per the Company’s Act 2013. Previously, in order to find a private company you need at least 2 members and directors. On the other hand, you needed at least 7 members and 3 directors in order to start a public company. A single person was never allowed to incorporate a company earlier on.

However, the Section 2 (62) of said act has made it possible for the people who want to form a company with just one director and one member. Normally, in such a company the compliance related requirements are lot lesser than a private company.

As per the statistical report, it is shown that the number of registered one person company is growing gradually in India. Because the entrepreneurs or single business owners are liking to do business as OPC rather than sole proprietorship to get the advantages of it.

You might be interested to know what are the numbers of one person company are registered in India till date. Here we share a little information on OPC formation which carries the records that how many companies are annually registered from financial year 2014-18 (until March).

As on 30th June, 2018, a total number of 18,153 One Person Companies (OPCs) were registered in India. The below image chart gives a pictorial representation view of OPC.

See the growth chart of registered one person company (OPC) as on 30th June, 2018:

What is OPC Registration?

OPC registration means solopreneurs or entrepreneurs could register their venture or business enterprises with MCA (Ministry of Corporate Affairs) under the laws and rules of Companies Act, 2013 and start as a single person/owner entity to reach in their business goals. To do business in India; a business has to get a legal name and this called registration. After registration, the ABC Company will be known as “ABC OPC Private Limited” and it is treated as one person Pvt Ltd Company.

Features of a One Person Company (OPC)

As far as the rules and regulations in India are concerned only a natural citizen of India can start an OPC over here. The same facility is also available to the residents of India. Such an individual can be both the nominee and a member of such a company. For the purpose of this particular discussion it must be mentioned that the term resident indicates a person who has stayed in the country for at least 182 days in the immediately previous financial year.

A person cannot be a member in more than 1 OPC. You also need to keep in mind that if your paid up share capital crosses the INR 50 lakh mark you have to change yourself into a public or private company. The same is also applicable if in the immediately preceding 3 financial years your yearly turnover crosses the INR 2 crore mark. This mandatory conversion needs to be completed within a period of 6 months.

As far as voluntary conversion is concerned, you need to wait for at least 2 years before you can change your company to a private or public company. After that period you can easily apply and change your company to the kind that you want to. The Companies Act, 2013 has laid down certain rules and regulations for such conversion under Section 18 as well as Rule 7 (4) of the Companies (Incorporation) Rules, 2014. They have to be followed to the letter in such cases.

There are also some mandatory rules and regulations that you have to observe as an OPC. You should have at least one board meeting in each period of 6 months in a calendar year. At the same time, these meetings should not be more than 90 days apart. You have to maintain proper bank accounts and get your financial statements audited the right way. Each year you have to file your business income tax returns prior to 30^th September. You need to file your ROC (Registrar of Companies) Annual Return through Form MGT-7 and financial statements through form AOC-4.

If you happen to be a minor you would not be allowed to form such a company. The same will also be applicable if you are a foreign citizen, a person who is contractually incapacitated, or a non resident of India.

Advantages of an One Person Company

There are several advantages of an OPC that may be enumerated as below:

It is a separate legal entity
It is easier to get funding for the same
The liability is limited but opportunities are endless
You get the benefits normally associated with owning a small scale industry (SSI)
You are the only owner
Even with a bad credit rating you would get a loan if you are an OPC
You get Income Tax benefits
You get high interest on any late payment
These companies carry a lot of prestige and the faith in them is increasing by the day

It needs to be stated in this context that the income tax benefit is perhaps the only tax related benefit that an OPC is entitled to. Otherwise all the other kinds of taxes such as Dividend Distribution Tax and MAT (Minimum Alternate Tax) are applicable for these companies as well. They are applicable in this context just as they are for others as well.

Why You Must Register a One Person Company in Bangalore?

There are several reasons as to why you (entrepreneur) should register such a company in Bangalore. The capital city of Karnataka happens to be one of the major business hubs in the country and this means that there are plenty of chances for you to prosper. So you should you start a company over here.

In fact, right now Bangalore can be called as one of the great tech hubs of Asia itself. Foreign investors, entrepreneurs and capitalists have eyes on this place.

Just to name a few reasons here:

To create better image and credibility in the market
To magnetize the faith of the customers
To make distinct personal liability from business
To get bank credit & investment from investors
To create faith & attract talented manpower
To make potential to get more customers
To make your business a magic brand

Apart from that there are also plenty of companies over here that can help you get started in this regard. But we are a leading trademark and company registration services provider, offering wonderful services for business brands to make impact on their industry niche. We are the specialists in such work and have plenty of experience in this regard as well. We have helped plenty business entities like you before and you can expect us to do the same for you as well. We know quite clearly what works and what does not. We bring such knowledge and experience to bear for your benefit and make sure that you get what you need.

Documents Required for OPC Registration in Bangalore

PAN card copy of director/members
Passport size photograph
Proof of identity (Aadhaar Card, Voter ID, Passport, Driving License)
Proof of Residence in the name of applicant (Bank statements, Electricity Bill, Telephone Bill, Mobile Bill)
Rental agreement/ Sale deed of property from owner of the premises for using it as registered office
NOC from the owner of the premises for registered office
Electricity/ Telephone/ Mobile Bill & Property Tax Receipt required for premises address proof

How to Incorporate or Register an OPC?

Here are the 6 steps which must be needed for OPC registration process:

Applying for Company Name Approval
Applying for Digital Signature Certificate (DSC)
Applying for Directors Identification Number (DIN)
Preparing Documents for Registrar of Office (ROC)
Filing Forms with MCA
Issuing Certificate of Incorporation (COI)

And here we have shared a brief explanation for the above procedure where the applicant or entrepreneur could learn, know and understand the step by step process of incorporation.

Applying for name approval in MCA

There are certain steps as far as how to register an OPC in Bangalore is concerned. The first step in this regard is to apply to get your company’s name approved. As per rules and regulations the name of the company should be like this – name of company (OPC) private limited. There are 2 options that you have in this regard – you can fill up Form SPICe 32 or use a web service named RUN (Reserve Unique Name) being operated by the MCA (Ministry of Corporate Affairs). In both these cases you would have to provide a name and also the significance of why you want that name. However, from 23^rdMarch 2018 onwards the MCA has opted to provide the option of a resubmission (RSUB) along with 2 proposed names.

Applying for DSC

The second step is that you need to take in this regard is to procure a Digital Signature Certificate (DSC) from the authorized Certifying Authority (CA), to whom the permission has given by the Central Government to issue the DSC. This is for the person who is supposed to become the company’s director – you. You normally need documents such as address proof, Aadhaar Card, PAN (Permanent Account Number) card, a photo, email id (identification), and phone number.

Applying for DIN

After you get your DSC the next step that you take in order for OPC registration in Bangalore Karnataka is to apply for your DIN (Director Identification Number). For this, you need to fill up the SPICe (Simplified Proforma for Incorporating Company Electronically) form and provide your name and address proof. If you are already an existing company you should be filling up Form DIR-3. This implies that starting from January 2018 companies need not file that particular form in a separate manner. This particular application can be made for a maximum of 3 directors.

Preparing the documents for ROC

Once the MCA approves of the name you have to start preparing the documents that you would submit to the ROC.

The first such document is the Memorandum of Association (MoA). It contains the objectives that the company would follow. It basically states the business for which the company is being started.

The second document in this regard is the Articles of Association (AoA). It basically mentions the bylaws that would be followed in order to run the company.

Since such a company has only 1 member and 1 director a nominee needs to be appointed. This person would take over the reins when the director is unable to run the company because of death or incapacity of some or the other kind. In this case the consent would be taken in Form INC-3. The concerned person would have to provide documents such as Aadhaar Card and PAN Card.

The fifth document in this regard is the proof that you have a registered office for the proposed company. You also need to furnish a NOC (No Objection Certificate) from the property’s owner or show proof of ownership yourself.

You, the director, would also need to provide Consent and Affidavit by way of Form DIR-2 and INC-9 respectively.

You also need to provide professional certification of the fact that you have met all the compliances in this regard.

Filling forms with MCA

You need to attach all these documents to the SPICe Form, SPICe-AoA, and SPICe-MoA. You would also need to attach your DSC as well as that of the professional who has certified that you have satisfied all the necessary compliance. Then you need to upload these on the official website of MCA in order for them to be approved. Once you have uploaded the documents Forms 49B and 49A would be created. These would help generate your company’s PAN and TAN (Tax Deduction and Collection Account Number). You would have to attach them to your DSC and upload them to the official website of MCA.

Issuing the certificate of incorporation

The ROC would verify all the documents and then issue the Certificate of Incorporation. Then you would be able to start your business legally.

One person company has the great opportunities rather to sole proprietorship; it can build a great wall of success by taking its advantages, when an innovative and creative thinking of an entrepreneur executed in his/ her business and energy to do some good things where the customer will be benefited as well as you also. But the thinking should be clear and concise about your motive.

How Long does it Take to Register an OPC?

We can register your one person company within 7 days. But before that client should have to provide all the necessary documents in time and choose a fresh unique name which helps to get approval quickly from MCA and speed up the incorporation process. Otherwise it will take more time for company incorporation.

How much does it Cost to Register a One Person Company?

We can help you to do complete your OPC registration in Bangalore at Rs 12,500 without any hidden charges. If any requirement is there; we would talk with you proceed for next step.

If you are thinking to get free consultation on company formation as well as for business matters from experienced Chartered Accountants, Company Secretary and Lawyers; get counsel here.