Proprietorship Registration

Compliance Under Proprietorship Registration

All proprietorship firms have to maintain certain compliances like other companies registered in India. The only difference between compliance for a proprietorship firm and other corporate entities is that a proprietorship firm requires only an income tax filing while other corporate entities require both income tax return filing with the Income Tax Department and annual return filing with the Ministry of Corporate Affairs.

Major compliances for proprietorship registration

Income tax filing – Sole Proprietorship is not taxed as a separate Legal entity. All proprietors who have a taxable amount must file income tax. In few cases, tax audits are also required.

GST filings – Under the GST regime, proprietorships having GST registration are required to file monthly, quarterly and annual GST returns.

ESI returns – Allproprietor firms having an ESI registration must file the ESI return. ESI registration is required only if the proprietorship firm hires employees.

TDS filing – If the proprietorship firm has a TAN, quarterly TDS returns must be filed and taxes need to be deducted at source as per TDS rules.

Compliance for MSME – MSME Form 1 is a mandatory compliance for companies which are defined in Section 9 of the MSMED (Micro, Small and Medium Enterprises Development) Act. The MSME Form 1 is filed on a half yearly basis to the MCA (Ministry of Corporate Affairs).

Food Safety and Standards Act (FSSA), 2006 Compliance- A few compliances under the FSSAI include licenses and registrations in regards with the Food Safety and Standards (Licensing and Registration of Food Business) Regulations, 2011. It also ensures safety, sanitary, and hygiene of food products that are offered to customers of the country. It is mandatory for all food business operators to obtain a license from FSSAI, including post farming, manufacturing, selling, retailers, labelling, and more.


Like any other corporate entity, it is mandatory for a proprietorship firm to maintain certain compliances. Although the compliances are minimal, it is still mandatory to maintain them.

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