If you plan to start a small business, you will need certain licences to make it legal! Read on to know what licenses you’d need to apply for!
Starting A Small Business? You Will Need These Licences!
Make sure you apply for these licences when starting a new small business!
1. Company or LLP Registration
Most businesses in India are started as proprietorships or partnership firms, without any registration from the Central Government. It is advisable for entrepreneurs who have plans for operating a business with an annual turnover of more than Rs. 20 lakhs to obtain an LLP or Company registration.
2. GST Registration
All types of entities and individuals who have an aggregate annual turnover of more than Rs. 20 lakhs in most States and Rs. 10 lakhs in the Special Category States are required to obtain GST Registration.
Further, any person supplying goods involved in intra-state supply is required to obtain GST Registration, irrespective of turnover.
It is important for all entrepreneurs to understand the criteria and obtain GST registration within 30 days of starting a business.
3. Udyog Aadhar Registration
This is a registration available for entrepreneurs who want to start and operate a small business – micro, small and medium enterprises.
The eligibility criteria for obtaining Udyog Aadhaar registration is based on the investment in plant & machinery made by a manufacturing concern or investment in equipment made by a service provider.
Once, Udyog Aadhaar registration is obtained for a business, it can enjoy various subsidies and schemes specially provided by the Government for helping small businesses in India.
4. FSSAI License or Registration
The Food safety and standard authority of India (FSSAI), is responsible to verify the safety and standardization of food products nationwide. Retail stores, restaurants, modern trade outlets, kiosks and consumers alike look for this five letter word in their food packets or containers.
Under FSSAI, the license or registration is divided into three categories namely:
- FSSAI Central License
- FSSAI State License
- FSSAI State Registration
5. Import Export Code
Any person involved in import or export of goods/services from India must obtain the Import Export Code from the DGFT Department. To obtain an Import Export Code, it is mandatory for the business to have a PAN and a Current Account in a bank.
6. Shop and Establishment Act Licence
“The Shop and Establishments Act” was created for regulating the conduct of business like the hours of work, child labour, payment of wages, safety and general health of the employees. This license is issued by individual State Governments.
7. Gumasta Licence
If you are planning to start a business in the state of Maharashtra, you must obtain a Gumasta licence. To procure it, one needs to possess the following documents:
- PAN Card
- An Address proof or a no-objection certificate from the landlord
- Application letter in the prescribed format to the Municipal Corporation of Greater Mumbai
- Authority Letter for Business
- Government Prescribed Fees for a partnership Firm
- Memorandum and Article Of association
- Certificate Of incorporation of the Company
- Director’s ID and Address proof
Other Licenses and Registrations
Certain types of business that involve aspects of providing insurance, financial services, broadcasting services, defence related services, etc., would require approval from regulatory bodies like Reserve Bank of India, IRDAI, etc.,
Further, a business may also have to obtain permits from the fire department, or the pollution control board, or maybe the local healthcare system.
It all depends on the type of business you are willing to operate. Hence, prior to starting a business, make sure you discuss your business with a professional to determine and understand the legal and regulatory requirements.
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