A sole proprietorship is a simple type of business structure that is owned and operated by the same person. It does not involve many of the complex filing requirements associated with other types of business structures such as corporations. Sole proprietorships allow persons to report business income and expenses on their individual tax returns. Also, the owner is entitled to all the profit that the sole proprietorship collects. On the other hand, sole proprietorships can be risky because there is no separation between the owner and the business. 

In other words, the owner remains personally liable for any losses or debts that the sole proprietorship incurs. They can also be held legally responsible for violations committed by the business or its employees

Sole Proprietorship Firm has following advantages :-

• A. Less Costing:-
  If we talk about the service based firm then it’s can be easily start with less than 5000 Rupees through service tax registration.
  If we talk about the product based firm then its depend on the type of tax registration or license as VAT/CST, Shop Act Licenses or MSME Registration.
• B. Lower Compliance:-
  You have to just file the income tax return as individual at the end of year. You have to maintain basic invoices of income and expenses of the firm.
• C. Lower Income Tax:-
  You have pay income tax to the government when your total real income is more than limit According to income tax. So it’s give you tax advantages on slab basis.

A sole proprietorship differs from other forms of business in several ways. The chief ways a sole proprietorship is different include:

• Sole proprietorships are the least complex and cheapest form of doing business.
• Sole proprietorships require no formal paperwork to set up and don't need to be registered with the state.
• Sole proprietorships are treated as simple income for tax purposes, and do not need to have separate taxes prepared

No, proprietorship registration is not required. But registration is required for getting the bank account open in the name of firm for your Business transition.

For the registration of proprietorship in MSME following documentary is required:-

• PAN Card of Proprietor
• Address Proof Of Proprietor
• Bank Account Statement Of Proprietor
• 2 Passport size photos
• Aadhar Card is Must.

Until and unless you have valid registration in the name of proprietorship firm, no bank wills going to open account in the name of the firm. A Proprietorship can go for registration under MSME Udyog Aadhaar registration and after then you can open your bank account in the name of proprietorship firm.

Proprietorship Firm Can opt for following registration on the basis of the activities of the firm:

1. MSME Udyog Aadhar
2. VAT/CST/Sales Tax Registration – For Trading Based Firm.
3. Service Tax Registration – For Service Provider.

Service tax Registration at formation of the firm is not mandatory it’s optional on the part of the Firm. It’s become mandatory if the total income/turnover of the firm crossed Rs. 10 Laces in a year.

NO, there is not provided any mechanism by government for proprietorship firm in compulsory format but proprietor can registered proprietorship firm in MSME/SSI under Udyog Aadhar.

No, Only an Indian resident person can establish proprietorship firm.