Licensed to Operate – Business Licenses and Permits Requirements in India
A quick read on essential business licenses and permits requirements in India from 3E Accounting.
Getting licenses and permits in India is not a job for the faint-hearted. Factors determining approvals include matters as diverse as a business activity to the number of employees, capital invested and location. Business solution firms such as 3E Accounting can offer a lifeline when it comes to such intricate compliance issues. However, as a business owner, there are some necessary business licenses and permits requirements in India that you should be familiar with.
Approved to Do Business in India
First of all, your company needs to be registered with the Ministry of Corporate Affairs or MCA. Anyone of the following types of companies can be incorporated:
- Private Limited Company (PLC)
- Public Limited Company (PC)
- Limited Liability Partnership (LLP)
- Partnership Firm
- One Person Company (OPC)
- Nidhi Company
A Certificate of Incorporation with a permanent account number (PAN) and a director identification number (DIN) will be issued upon successful registration. Next comes relevant tax registrations such as VAT, GST and service tax. Be sure to get a tax deduction and collection account number (TAN) as well.
Once you have your bank account sorted out, it’s time to look into approvals and permits. Generally, you will need a business licence, signage permits, relevant State and Central licenses. Most businesses will fall under the Shop and Establishments Act that requires a variety of permits from State and Central Governments. These permits set the rules on business code of conduct such as minimum wage, working hours, health and safety, etc.
The location also plays a part in determining approvals. If your business is located in the state of Maharashtra, you will need a Gumastha License to operate. This establishes your business as a legal entity and facilitates transactions with banks and Governments agencies.
Micro, small and medium enterprises can have access to Government subsidies and schemes if they apply for MSME or Udyog Aadhar registration. Eligibility is based on investment in machinery or equipment. If your company also has some form of overseas or trans-border trade, then you may require an importer-exporter Code (IEC). Application is made directly to the Directorate General of Foreign Trade (DGFT).
Businesses in any way involved in the food industry, including livestock and agriculture, will need approvals from the Food Safety and Standards Authority of India (FSSAI). State Registration is usually coupled with either Central or State Licenses as well.
For businesses in the financial services or medical sector, licensing and permits are very stringently monitored. FinTech companies, Nidhi companies or non-banking financial institutions will need NBFC Registration from the RBI or Reserve Bank of India. FinTech firms will also need to register their domains. Businesses in the medical sector must have licensed practitioners as owners and approvals from the Medical Council, State Council as well as a Pharmacy License.
Alliances That Empower Businesses
3E Accounting provides all supporting services that you may need in the course of starting up and running your business. Business licenses and permits requirements in India needn’t be a hindrance to your entrepreneurial dreams.
Contact 3E Accounting today for the confidence to do business the right way with the right solutions.