9 Registrations That a Startup Should Know About
As a startup if you want to do business you must first form a business entity. It can either be a company, sole proprietorship or partnership. Once a business entity is registered as per the rules, for instance, companies are registered as per Companies Act, 2013, you can commence business. Upon entity registration an entrepreneur must also get some other registrations done. 9 Registrations That a Startup Should Know About . Here's a list of mandatory registrations.
PAN stands for Permanent Account Number and Every business entity is mandatorily required to have one. It is a unique number allotted by the Income Tax department. Get your firm registered with Income Tax Department and obtain your unique PAN.
TAN stands for Tax Deduction Account Number. It must be applied for, by entities because they have to deduct tax at source (TDS) while making payments to contractors, landlords etc.
3. Service Tax
Every entity that is into the service industry must apply for a service tax number with the CBEC. The initial 10 letters of a unique service tax number is the PAN of the applicant.
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4. VAT and CST
Every business entity must mandatorily get a TIN number from Sales Tax department. Value Added Tax is paid on purchase and selling of goods and every organisation must be registered with the department. For all the entities that are involved in regular inter-state transactions must get Central Sales Tax registration to avoid excessive levying of tax.
5. Shop Establishment Act
According to the Act every firm must get registered with the local Municipal Corporation to commence business. It provides a licence or gumasta which makes the entity valid.
6. Professional Tax
Professional tax is a state tax levied by Municipal Corporations. It is paid once a year and every entity must oblige by paying a maximum of ₹2500. It is also deducted from every employee's salary according to his income.
7. Importer Exporter Code (IEC)
For those entities who are involved in import and export of goods and services must get themselves registered with the Director General of Foreign Trade (DGFT).
8. Trademark registration
Trademark registration is not mandatory but every organization must get its distinct/ unique mark registered to get exclusive rights of its use.
9. Entity Registration
A startup needs to form a legal entity to take investment in future and to have give the business a proper recognition before the Law. Most preferable entity structure for a startup is a Private Limited Company however, it may opt for Limited Liability Partnership or One person company if it suits the needs.
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