Saving vs Current Account
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Definition or Meaning
Sole Proprietorship Firm / Sole Proprietorship / Proprietorship / Individual
A sole proprietorship is a non-registered, unincorporated business (Not like Pvt Ltd / LLP / Firm / Trust / Society etc.) run solely by one individual proprietor with no distinction between the business and the owner
You can say proprietorship is not considered a separate legal entity, it has no distinct tax identification number. Instead, the proprietor’s Permanent Account Number (PAN) is utilized for tax-related transactions and filing returns on behalf of the proprietorship
Documents Required for GST Certificates / Other
Decide Firm Name (Ram is individual and he wants to open a Medical Store in the name of RAM Medicos / RAM Medical Store)
PAN of RAM
Aadhaar of RAM
Address Proof
When you obtain GST Certificate or any other certificates than there will be a Legal Name - Ram / Trade Name - Ram Medical Store
However, you can apply for GST / Trade License / IEC / MSME / Shop establishment etc. to open a Current Bank Account (You can work in Saving Account also if TOR/Sale/GR is not more than Rs 40 Lacs / 20 Lacs)
Disadvantages
Unlimited Liability - If the sole owner becomes fails to pay the debts, due to the failure of a business, the creditors would not only claim from business assets but also from his personal estate.
Limited Resources - Resources of a sole proprietor are limited to his savings and borrowings from the relatives. Banks also hesitate or deny giving the long-term loans or extend the limit of long-term loans due to the weak financial position of the business.
No investors are generally ready to invest
No Startup registration
Advantages
Easy to form and closure
Confidentiality of information
Quick decision making
Compliances
GST Registration - Monthly GSTR-1 and GSTR-3B , GST Payment by vendor, Booking of Bills properly
Daily Basis accounting - Purchase and Sale invoices , Bank Reconciliation, Debtors & Creditors
Advance Tax on quarterly basis - Interest @1%
TDS monthly and Qtrly TDS Return
Income Tax Return Yearly - 31 July or 31st Oct if Audit case
Income Tax as per Tax Slab (Old Tax Regime or New Tax Regime)
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DISCLAIMER ******** This video is merely a general guide meant for learn­ing purposes only. All the instructions, references, content or documents are for educational purposes only and do not constitute legal advice. We do not accept any liabilities whatsoever for any losses caused directly or indirectly by the use/reliance of any information contained in this video or for any conclusion of the information. Prior to acting upon this video, you're suggested to seek the advice of your financial, legal, tax or professional advisors as to the risks involved may be obtained and necessary due diligence, etc may be done at your end.