If you are planning on starting a sole proprietorship concern, you should be fully aware of various pros and cons that are involved in such a business. It would be a wise decision to consult myEfilings before you start a sole proprietorship. Also a consultant can help you calculate risk involved and help determine whether a sole proprietorship is the right business structure for you.

A proprietorship Concern can have only one promotor. So only one person is required to start a proprietory concern.

To start a proprietorship concern, the promotor must be an Indian citizen and Resident of India. NRIs and Persons of Indian Origin can start a Proprietorship Concern only with prior approval from RBI and Government of India. Profit earned through Proprietorship Concern in this case cannot be repatriated.

PAN card of the promoter, one identity and one address proof should be enough to start a proprietorship concern.

There isn’t any limit on minimum capital requirement for starting a Proprietorship Concern. A Proprietorship Concern can be started any amount which the promoter thinks is required to start new business and as desired by the Proprietor.

MyEfilings business advisory team will understand your business requirements and help you start a Proprietorship by obtaining required registrations. MyEfilings team will guide you to open your bank account in the name of your Proprietory Concern and apply for your required business registrations.

Reserve Bank of India mandates that the proprietor should provide proof of existence of a Proprietorship Concern alongwith PAN Card, identity proof and address proof of the Proprietor. The proof of existence of Proprietorship Concern can be any of these : Service Tax Registration, MSME Registration, VAT-TIN Registration, Shop & Establishment Certificate Chartered Accountant's certificate or any other documents as provided in Reserve Bank of India's KYC norms.

No, the Proprietorship Concern does not have a separate legal identity. Proprietor and Proprietorship Concern are one and the same. Proprietorship Concern does not have a separate PAN Card. PAN Card of the proprietor will be the PAN Card of Proprietorship Concern. Tax Filing of Proprietorship Concern is done in the name of proprietor. Assets and Liabilities of Proprietorship Concern are that of proprietor. Therefore, there will be no separate legal identity for the business.

Since Proprietorship Concerns are neither incorporated nor registered anywhere, they do not have Certificate of Incorporation or Registration. The identity of a Proprietorship Concern is established by registering it with applicable and relevant Government authorities e.g. Service Tax Registration or VAT TIN Registration.

There is no registry or regulation for registering the name of a Proprietorship concern. Therefore, proprietorship concerns can be named after anything as per the choice of the proprietor but should not infringe registered trademarks. Since there are no registry or regulations for registering name of a Proprietorship concern, the only way to ensure exclusive use of the name is to obtain a trademark for the business name.

Ownership of Proprietorship concern cannot be transferred to any other person unlike a Private Limited Company by way of transferring shares or a Limited Liability Partnership. However the assets of a Proprietorship concern can be transferred to other person through sale or any other mode as prescribed by law. Government licenses and registrations of a Proprietorship concern cannot be transferred.

No, proprietorship concern is a type of business which is owned by a single individual, it is controlled and managed by the proprietor only. You cannot add partners to a Proprietorship concern.

No, Proprietorship concerns are owned, controlled and managed by only one person. Therefore a Proprietorship concern cannot issue shares to the investors.

There are not many compliances of a Proprietorship Concern. The proprietor has to lodge his income tax return with the Income Tax authority every year. Other compliances such as Service Tax return filing or VAT return filing etc may be necessary depending upon the nature and size of business.

Audit is not compulsory for every Proprietorship concern. Audit is necessary only for those Proprietorship concerns which fall under the audit criterion under different laws.

Yes, there is a procedure prescribed to convert a Proprietorship Concern to a Private Limited Company or a Limited Liability Partnership.