Do you really need a company to start your business in India in 2024?
January 26, 2024
Start your business in India in 2024
India in 2024 is now a land of opportunity, optimistically speaking it would become the manufacturing capital of the world.
If you are wondering to begin your own venture, trust me the time cannot be more conducive and nurturing considering the tech savvy political system which is favoring the startup culture like never before.
Are you required to register your company to begin your business?
The answer is NO.
To begin with you do not require to register your business and can start as a Sole Proprietorship.
You do not require any registration per say as per the law.
All that you require is as follows:
- Find a suitable name for your business,
- Create a Logo,
- Get yourself an Invoice template,
- You can use your own Bank Account for all the financial transactions.
And the Final step would be marketing your products or services by the same name.
In order to succeed in your business you are now required to do the following:
- Build a website.
- Create Social Media Accounts for customer outreach / marketing your product/s or services.
- Start running paid ads in the geographical area where you feel you get highest leads.
- Since “Content is the King” for marketing – Keep your content high quality and unique.
- Follow your competitors and study them, use the practices that worked well for them.
But once you reach at the threshold of INR 20 Lakhs, then you are liable to get registered with GST within 30 days of crossing the limit.
Then what would be the possible limitations of having Sole Proprietorship firm. Lets discuss:
- Limited Life: Unlike companies the life of sole proprietorship is same as that of Sole proprietor. It lacks perpetuity.
- Unlimited Liability: This means that the owner is personally liable for all the debts and the obligations of the business. If the business makes any losses or faces legal action, the owner’s personal assets, such as their home, car, or savings, can be used to settle the debts.
- Cannot raise capital: The sole proprietorship business cannot issue shares unlike companies. Thus difficult to attract investor and thus Not at all investor friendly
- Not Eligible for startup schemes: The new policies of the current government does not consider sole proprietorship businesses for incentive schemes.
- Solo driven
- Non Transparent
- Lack of trust by the market: In India, private companies hold good reputation and are trustworthy.
While sole proprietorship is something which offers you ease of formation and most minimalistic compliance, it is not suitable if you plan to grow your business substantively.
If you are wondering which modality would suit you may refer to our guides or get in touch with us. We are just a call away.
Require any advice on Company Formation-go to our blogs and get educated.
Frequently Asked Questions (FAQ’s)
Q1: How will I be taxed if I do not register a company in India?
A1: You will be taxed as an Individual as per Income tax Act.
Q2: How much does it cost to register a Sole Proprietorship?
A2: It depends on what registrations are required on the basis of business you are in.
Q3: Is it necessary to register for Udyam Registration?
A3: Not really but yes you should take the registration.
Q4: Can a Sole Proprietorship be registered under MSME?
Q5: What happens to my business if I become incapacitated or die?
A5: The business shuts down ipso facto.
Q6: Can I avoid unlimited liability in a sole proprietorship?
A6: Unfortunately, no. Unlimited liability is inherent to the structure of a sole proprietorship. However, you can consider incorporating your business as a Private Limited Company (PLC) or Limited Liability Partnership (LLP) to enjoy limited liability protection.