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Entity Registration

Legal registration of your business as a firm, LLP, or company.

What is Entity Registration?

Entity Registration is the process of formally creating a business structure under Indian law. It provides the business with legal identity, ownership structure, liability clarity, and eligibility for other statutory registrations (PAN, GST, Udyam, licences, bank accounts, etc.).

Different business structures provide different levels of:

  • Compliance
  • Legal protection
  • Scalability
  • Tax treatment
  • Funding eligibility
  1. Why is Entity Registration Needed?

Entity registration helps a business:

  • Get a formal legal identity
  • Open a business bank account
  • Apply for PAN, GST, Udyam, TAN, Trade Licence
  • Sign contracts, agreements, leases
  • Hire employees legally
  • Limit liability (LLP/Company)
  • Raise funding (Companies & LLPs)
  • Participate in tenders, marketplaces, supply chains
  • Build credibility with banks, vendors, and customers

Without proper entity registration, many regulatory, tax, and banking activities are not allowed.

  1. Types of Entity Registration (MSME-Relevant)

This document covers:

  1. Sole Proprietorship
  2. Partnership Firm
  3. Limited Liability Partnership (LLP)
  4. Private Limited Company

SOLE PROPRIETORSHIP

What is a Sole Proprietorship?

A Sole Proprietorship is the simplest business structure where the owner and business are legally the same. There is no separate legal entity, and the business uses the owner’s personal PAN.

There is no formal government registration process for proprietorships in India.
A proprietorship is recognised through supporting business identity documents, such as GST, Udyam, current account, and local licences.

Why is it Needed?

Proprietorships are chosen for:

  • Ease of starting the business
  • Zero registration cost
  • Low compliance
  • Suitable for small traders, freelancers, consultants, retailers, home businesses

Who Can Apply?

Any individual above 18 years with valid Aadhaar and PAN.

PARTNERSHIP FIRM

What is a Partnership Firm?

A Partnership Firm is created when two or more persons enter into a partnership deed to run a business jointly.
It may be:

  • Unregistered (common & accepted)
  • Registered with the Registrar of Firms (ROF) (optional but beneficial)

Why is it Needed?

  • Easy to form
  • Lower compliance compared to LLP/Company
  • Suitable for small businesses with multiple owners
  • Enables opening current account, PAN, GST, Udyam
  • Enables shared responsibility & profit-sharing

Who Can Apply?

Two or more partners with a valid Partnership Deed.

LIMITED LIABILITY PARTNERSHIP (LLP)

What is an LLP?

An LLP combines the operational flexibility of a partnership with the limited liability of a company. It is governed by the LLP Act, 2008.

Why is it Needed?

  • Limited liability protection
  • Separate legal identity
  • Low compliance compared to a company
  • Attractive for consultants, small firms, professionals
  • Perpetual succession
  • PAN automatically issued after incorporation

Who Can Apply?

  • Minimum 2 designated partners
  • At least 1 must be Indian resident

PRIVATE LIMITED COMPANY

What is a Private Limited Company?

A Private Limited Company is a separate legal entity formed under the Companies Act, 2013, offering limited liability, separate tax identity, and high credibility. PAN & TAN are auto-issued upon incorporation.

Why is it Needed?

  • Limited liability protection
  • Strong credibility for B2B and tenders
  • Investor-friendly structure
  • Eligibility for equity funding and ESOPs
  • Perpetual succession
  • Preferred for scalable businesses

Who Can Apply?

  • Minimum 2 directors & 2 shareholders
  • At least 1 resident director
  • Foreign nationals allowed (with additional documentation)

Document Checklist

Sole Proprietorship:

A proprietorship is not formally incorporated.
It is identified through supporting registrations.

You may obtain any of the following:

  • GST – if turnover exceeds threshold
  • Udyam – for MSME recognition
  • Trade Licence / Shops & Establishment – for local operations
  • Open a Current Account using proprietor PAN + local shop licence

Partnership Firm:

  • Partnership Deed
  • If registered: Certificate from Registrar of Firms
  • Proof of address of the firm:
    • Electricity bill / Water bill / Property tax receipt / Landline bill / Broadband bill / Rent agreement + NOC / Gas bill (any one)
  • Identity & address proof of authorised partner:
    • Aadhaar / Passport / Voter ID / Driving Licence
    • PAN (if allotted)

Limited Liability Partnership:

  • PAN, Aadhaar of Partners
  • Identity proof (Passport/DL/Voter ID) of Partners
  • Address proof (utility bill/bank statement) of Partners
  • Photos of Partners (for MCA KYC)
  • Registered Office’s Electricity bill / Gas bill / Rent agreement + NOC
  • LLP Agreement
  • Digital Signatures (DSC)
  • Director Identification Number (DIN allocation inside FiLLiP)
  • Private Limited Company:

For Indian Directors:

  • PAN, Aadhaar
  • Passport/DL/Voter ID
  • Address proof(Utility Bill/Bank Statement)
  • Photograph
  • DSC

For Foreign Directors: (Notarised & Apostilled)

  • Passport
  • Foreign address proof
  • Certified ID documents
  • DSC

Registered Office:

  • Electricity bill / Gas bill / Property tax receipt / Rent agreement + NOC

Other Documents (auto-generated):

  • eMOA
  • eAOA
  • INC forms

Professional Certification (Mandatory): All SPICe+ forms must be digitally certified by a practicing CA/CS/CMA/Advocate.

How and where to apply?

Sole Proprietorship:

A proprietorship is not formally incorporated.
It is identified through supporting registrations.

You may obtain any of the following:
GST – if turnover exceeds threshold
Udyam – for MSME recognition
Trade Licence / Shops & Establishment – for local operations
Open a Current Account using proprietor PAN + local shop licence

Cost

No formal incorporation cost. Costs apply only for other registrations (GST, Udyam, local licences).

Validity

Continues as long as the proprietor is alive. No separate legal existence.

Unregistered Partnership Firm

No mandatory central registration.
Validity is established through:

  • Partnership Deed
  • PAN of Firm (Form 49A)
  • Bank Account
  • GST / Udyam / Local registrations (if applicable)

Registered Partnership Firm (Optional)

Registering a partnership firm with the State Registrar of Firms (ROF) provides legal recognition and helps in enforcement of rights under the Partnership Act, 1932.

General Application Process – State Wise

Although forms differ slightly by state, the overall process is the same:

  1. Prepare Partnership Deed
    • Signed by all partners
    • Notarised
    • Stamped as per state Stamp Act
  2. Fill the Partnership Registration Application
    Common names (depending on state):
    • Form 1 (most states)
    • Statement of Firm
    • Application for Registration of Partnership Firm
  3. Submit Required Documents
    • Partnership Deed (notarised)
    • Application Form 1
    • Affidavits/Declarations (partner identity + consent)
    • Address proof of firm
    • Address proof of partners
    • Signatures of all partners
  4. Pay State-specific Registration Fee
    Usually between ₹100 to ₹1500, depending on state fee rules.
  5. Registrar Verification
    Registrar checks:
    • Deed format
    • Partner names
    • Business address
    • Stamp duty
    • Identity proofs
  6. Firm Registration in Register of Firms
    Details of the firm are entered in the State Register.
  7. Receive Certificate of Registration
    Issued by the Registrar of Firms.
    This confirms the firm is officially registered under the Partnership Act, 1932.

Official State Portals (Examples)

Partnership registration is done through the Registrar of Firms (state-wise).
Examples:

(Search “Registrar of Firms + State Name” to find the portal for your state.)

Cost

  • Unregistered: Minimal (stamp duty on deed)
  • Registered: State ROF fee + stamp duty

Validity

Perpetual until dissolved as per deed or by partners.

Limited Liability Partnership

LLP is incorporated entirely through MCA portal.

Process:

  1. Apply for Name Reservation (RUN-LLP)
  2. File FiLLiP form
  3. Submit partner details + DSC
  4. Upload LLP Agreement
  1. Professional Certification (Mandatory)

MCA requires LLP incorporation forms (FiLLiP and related attachments) to be digitally certified by a practicing CA/CS/CMA or Advocate. This ensures correctness of partner details, registered office, capital contribution, and compliance documents.Receive Certificate of Incorporation + PAN automatically

Portal: https://www.mca.gov.in

Cost

MCA fees based on capital contribution + DSC + professional charges.

Validity

Perpetual until official winding up.

Private Limited Company

Incorporation via MCA SPICe+ system:

  1. Name Reservation (Part A)
  2. SPICe+ Part B
  3. eMOA & eAOA
  4. AGILE-PRO
  5. Upload documents with DSC
  6. Professional Certification
  7. Certificate of Incorporation issued
  8. PAN & TAN auto-generated

Integrated Registrations (Optional via AGILE-PRO)

  • EPFO
  • ESIC
  • Professional Tax (state-dependent)
  • Current Account Opening (partner banks)

Availability varies by state and bank.

Cost

MCA charges + DSC + professional certification. Cost varies by authorised capital.

Validity

Perpetual succession regardless of ownership changes.

Click Here To Download PDF Guide.