Is company registration necessary for MSME?

 

The Micro, Small and Medium (MSME) sectors benefit from a number of government programmes designed to support their expansion thanks to MSME registration. However, company registration is not necessary for MSME. But, having both only multiplies the benefits and reliability.

 

A developing nation like India relies heavily on its MSME industries to support its economy. These sectors expand along with the economy of the nation. These businesses are also referred to as SSIs or small-scale industries.

 

Although the Government of India has not yet made MSME registration essential, it is advantageous to do so because it offers numerous advantages in terms of taxation, company registration online, credit facilities, loans, etc.

 

What is MSME classification?

 

The government first focused the MSME classification on investment criteria in plants, machinery, or equipment when it first implemented the MSME registration in 2006. 

 

By adding requirements for annual turnover and composite investment, the government updated the MSME categorization. The MSME definition also eliminated the gap between the manufacturing and services industries.

 

Required Documents for MSME Registration

 

These are the documents required for MSME registration:

 

• PAN card 
• Aadhaar card

 

There are no costs associated with registering an MSME, and no documentation is needed. 

 

The Udyam Registration Portal, which is integrated with the Income Tax and GSTIN systems, would automatically pull PAN and GST-related information on investments and turnover of businesses from the Government databases.

 

Businesses that are exempt from the GST law's registration requirements are not required to register for GST. However, in order to receive the MSME Registration, businesses that are required by the GST Law to register for GST must provide their GSTIN.

 

How do I register my MSME on the Udyam Registration Portal?

 

The whole registration for MSMEs is done online. On the official website udyamregistration.gov.in, MSMEs must register online. For registration, there is no MSME registration cost. Online MSME registration is available in the portal's following two categories:

 

• For new business owners who have not yet registered as an MSME or an EM-II
• For those who have a UAM registration, and for those who have a UAM registration through assisted filing.

 

 

For new business owners who have EM-II or are not yet registered as MSME

 

Step 1: Clicking the "For New Entrepreneurs who are not Registered as MSME or those with EM-II" button on the Udyam Registration Portal's home page is required for both new and EM-II registered business owners.

 

Step 2: On the following screen, click the "Validate and Create OTP Button" after entering the entrepreneur's name and Aadhaar number. The PAN Verification page opens after this button is clicked, the OTP is obtained, and it is input.

 

Step 3: After entering the "Type of Organization" and PAN Number, the business owner must click the "Validate PAN" button. The portal obtains the PAN information from government databases and verifies the entrepreneur's PAN number.

 

Step 4: The Udyam Registration form will appear after the PAN has been verified, and entrepreneurs must fill it out with their personal information and information about their business.

 

Step 5: Fill out the declaration, choose the investment and turnover information, and then click the "Submit and Receive Final OTP" button. Once the OTP has been entered and the form has been submitted, the Udyam Registration Certificate will be issued by email. The Udyam Registration Portal allows business owners to view the status of their MSME registration.

 

Registration For Business Owners With UAM

 

The button labelled "For those having registration as UAM" or "For those already having registration as UAM through Assisted filing" must be clicked by individuals who have an existing UAM registration. 

 

The Udyog Aadhaar Number must be input on the subsequent page, and an OTP option must be chosen.

 

You have the choice of obtaining the OTP via email or mobile with the filled-out UAM. The "Validate and Create OTP" button must be hit after selecting the OTP Options. 

 

After inputting the OTP, the MSME registration form must be completed with the necessary information, and Udyam registration is then complete.

 

 

 

 

 

Advantages of Registering as an MSME

 

The advantages of MSME registration are outlined below:

 

• Bank loans are now more affordable thanks to MSME Registration and company registration online because the interest rate is so much lower than that of standard loans—it is only about 1% to 1.5%.
• Also, it let the minimum alternate tax (MAT) credit be carried forward for up to 15 years rather than just 10.
• Once registered, there are more discounts and concessions available, which lowers the cost of obtaining a patent or the cost of establishing an industry.
• As Udyam Registration Portal is integrated with Government e-Marketplace and numerous other State Government websites, which provide simple access to their marketplace and e-tenders, MSME registration aids in the acquisition of government tenders.
• For unpaid MSME amounts, a one-time settlement fee applies.
• The MSMEs' ability to take advantage of government programmes like the Credit Guarantee Plan, Credit Linked Capital Subsidy Scheme, Public Procurement Policy, Protection against Delayed Payments, etc. will be aided by their registration as an MSME.
• MSMEs are eligible for funding from banks in priority sectors.
• A government security deposit waiver is advantageous for MSMEs and is useful when participating in e-tenders.
• It is possible to include or specify any number of operations, such as manufacturing, services, or both, in a single MSME registration.
• Subsidy for barcode registration
• Plan for immediate tax exemptions
• Payment of ISO certification fees
• reduction in electricity costs
• Particular attention during international trade shows

 

Who may submit an Udyam Registration application?

 

Applying for MSME registration is open to all manufacturing, service, wholesale, and retail businesses that meet the updated MSME classification criteria for annual sales and investment. 

 

Consequently, an entity's yearly sales and investment determine whether it is eligible for MSME registration. The following organisations are qualified to register as MSMEs:

 

• Individuals, startups, business owners, and entrepreneurs
• Private and public limited companies
• Sole proprietorship
• Partnership firm
• Limited Liability Partnerships (LLPs)
• Self Help Groups (SHGs)
• Co-operative societies
• Trusts

 

Frequently Asked Questions

 

• What is a certificate of MSME registration?

MSMEs in India receive an electronic certificate from the Ministry of MSME known as the Udyam registration certificate. Known as the MSME registration certificate, the Udyam registration certificate. After completing the MSME registration process, the business owners are given the MSME registration certificate.

 

• Is it possible to register an LLC as an MSME?

Yes. A partnership firm may apply for MSME registration if it meets the investment and turnover requirements for the MSME classification.

 

• Is an Aadhar card required in order to register for Udyam?

Yes. An Aadhar card is required in order to register for Udyam. The Aadhar cards of the partner and director are necessary if the applicant is someone other than the business owner.

 

• What is the MSME registration certificate's or Udyam registration certificate's validity?

The Udyam/MSME Registration Certificate never expires. The certificate will remain valid as long as the organisation maintains moral standards and a sound financial position.