How To Register A Small Business In India
Opportunity India Desk
Feb 18, 2022 -
4 min read
Ever wondered how much a small street vendor makes in a month? Or what is the monthly income of the tailor who fits your clothes. Surprisingly, these small businesses are not that much smaller than they seem to be. As per the National Sample Survey (NSS) 73rd round conducted during the period 2015-16, Micro Small and Medium Enterprises have been creating 11.10 crore jobs in the rural and the urban areas across the country.
What is a Small Business?
However, there is no special criteria that decides whether a business is small or big, the MSME ministry has decided a criteria to segregate them on the basis of their size. Below are the measure which decide under which category the business falls
How to Register?
In order to register, you will need to submit a form that you can find on the Udyam Registration portal. Currently there is no fee for filing an Udyam Registration.
Depending on the types of ownership you need to submit the Aadhar details (Aadhar number should be - of owner in case of Sole proprietorship, of the managing partner in the case of a partnership firm and of a Karta in the case of a Hindu Undivided Family (HUF).
If your business is already registered as a Company or a Limited Liability Partnership or a Cooperative Society or a Society or a Trust, you (supposing you as the owner or authorised signatory) must provide Goods and Services Tax Identification Number (GSTIN) and Permanent Account Number (PAN) along with your Aadhaar number.
Registration Process
If you want to set up a micro, small or medium enterprise, you may start by filing an Udyam Registration online in the Udyam Registration portal, based on self-declaration with no requirement to upload documents, papers, certificates or proof.
The Udyam Registration portal will assign a permanent identifying number in the name of your enterprise (referred to as "Udyam" in the portal) as "the Udyam Registration Number".
After successful registration, an e-certificate titled "Udyam Registration Certificate", will be issued to you.
Important Things to Know While Registration
If you are an already registered enterprise having Udyam Registration Numbers you must update the registration information online on the Udyam Registration portal, including the Income Tax Return (ITR) and GST Return details for the previous financial year and any other additional information that may be required, on a self-declaration basis.
Your enterprise will be liable for suspension of its status if it fails to update the relevant information within the timeframe specified in the online Udyam Registration portal.
The classification of the enterprise will be updated based on information furnished or Gathered from the Government's sources, including ITRs and GST returns.
Additionally, in case of any graduation (from a lower to a higher category) or reverse graduation (falls to a lower category), you will be informed with a communication explaining the changes.
If your enterprise experiences an upward change in investment, or in plant and machinery, or equipment, or turnover, the enterprise will maintain its prevailing status until one year after the registration expires.
Unless specified otherwise in the Udyam Registration, you should not file more than one Udyam Registration; manufacturing activities, services or both may be included or added in one Udyam Registration.
The penalties specified in Section 27 of the Act shall apply to anyone who intentionally misrepresents or attempts to suppress self-declarations in the Udyam Registration or update process.
Complaints and Grievances Regarding Registration of an MSME
If you are facing any problems in filing the Udyam Registration for any reason including lack of Aadhaar number, you may approach any of the below Single Window Systems for Udyam Registration purposes with any of the below mentioned document;
The Single Window Systems will facilitate the process including getting an Aadhaar number and thereafter in the further process of Udyam Registration.
In addition to the Champions Control Rooms situated in various institutions and offices of the Ministry of Micro, Small and Medium Enterprises, the Development Institutes (MSME-DI) shall also act as single window systems in order to facilitate the registration process and further help micro, small and medium enterprises in any way possible. Furthermore, the District Industries Centres (DIC) will serve as single window facilitation systems within their districts.
