Proprietorship Compliance Services | Savlana Init

Compliance · Proprietorship

Proprietorship Compliance — Annual Tax and Regulatory Compliance for Sole Proprietors.

A sole proprietorship's compliance covers income tax (ITR-3 or ITR-4), GST returns, professional tax, advance tax, Shop Act renewal, and Udyam registration. We manage your full proprietorship compliance calendar every year.

A sole proprietorship is the simplest form of business entity in India — it has no separate legal identity from the owner, involves no formal incorporation, and carries lighter compliance obligations than a company or LLP. However, 'lighter' does not mean 'absent.' A sole proprietor is personally liable for all business obligations and must comply with income tax filing, GST (where applicable), professional tax, advance tax payments, and any trade-specific licences or registrations that apply to the nature of the business.

The income tax filing obligation for a sole proprietor depends on the nature of income: proprietors with business income above ₹2 crore in turnover (and not opting for presumptive taxation) must file ITR-3 with audited accounts; those eligible for and opting under Section 44AD (presumptive taxation for businesses) or Section 44ADA (for specified professionals) file ITR-4 (Sugam). The tax audit requirement under Section 44AB applies where turnover exceeds ₹1 crore (for business) or ₹50 lakh (for professionals) and the proprietor does not opt for presumptive taxation. GST registration is mandatory where turnover exceeds the prescribed threshold, and GST returns (GSTR-1 and GSTR-3B monthly or quarterly) must be filed consistently.

Professional tax registration and compliance applies in states that levy it, and the Shop and Establishment Act (Shops Act / Gumasta) licence must be maintained and renewed for business premises in applicable states. Udyam (MSME) registration provides access to government schemes, collateral-free credit, and priority-sector benefits. We handle the full compliance calendar for sole proprietors — income tax, GST, advance tax, professional tax, licences, and Udyam — so that no deadline lapses.

Our Proprietorship Services

Income Tax Return (ITR-3 / ITR-4)

Filing the annual income tax return for the proprietor — ITR-3 with audited accounts or ITR-4 (Sugam) under presumptive taxation.

GST Registration & Returns

GST registration where applicable and monthly/quarterly GSTR-1 and GSTR-3B return filing.

Tax Audit (Section 44AB)

Coordinating the tax audit where turnover exceeds the Section 44AB threshold and presumptive taxation is not opted.

Advance Tax Computation & Payment

Computing quarterly advance tax liability and tracking the four instalment payments (June, September, December, March).

Professional Tax Registration & Returns

Professional tax registration for applicable states and annual/monthly return filing as required.

Shop Act / Trade Licence Renewal

Tracking and renewing the Shop and Establishment Act licence before expiry each year.

Udyam / MSME Registration

Registering or updating Udyam registration to reflect current turnover and secure MSME scheme access.

TDS Compliance

TDS deduction and Form 26Q filing where the proprietorship has employees or makes contractor payments above threshold.

Our Process

Annual Compliance Calendar Setup

We map all deadlines — GST return dates, advance tax dates, ITR due date, professional tax, Shop Act renewal — at the start of each year.

GST Return Cycle

GSTR-1 and GSTR-3B filed monthly or quarterly throughout the year; annual GSTR-9 filed after year-end.

Tax Audit & ITR Preparation

Tax audit coordinated where applicable; business income, deductions, and advance tax payments compiled for ITR filing.

Professional Tax & Licence Management

Professional tax payments and returns filed; Shop Act licence renewal tracked and filed before expiry.

Advisory & Planning

Post-ITR review of tax position; advisory on advance tax for the next year and on conversion to company or LLP if beneficial.

Why It Matters

✓Annual compliance calendar covering GST, income tax, and licence deadlines maintained

✓GST returns filed on schedule — GSTR-1, GSTR-3B monthly or quarterly throughout the year

✓ITR-3 or ITR-4 filed based on business income type, turnover, and presumptive taxation eligibility

✓Tax audit coordinated under Section 44AB where turnover crosses the applicable threshold

✓Advance tax liability computed and all four quarterly instalments tracked and paid on time

✓Professional tax registration and returns managed in applicable states

✓Shop Act / Trade Licence renewal tracked and filed before the expiry date

✓Udyam registration obtained or updated to reflect current annual turnover

Frequently Asked Questions

A sole proprietorship must file an annual income tax return (ITR-3 or ITR-4), file GST returns if registered, pay advance tax in quarterly instalments, maintain professional tax compliance in applicable states, and keep trade licences (Shop Act) current. There are no MCA filings as a proprietorship is not a separate legal entity.

Sole proprietors with business income file ITR-3 where accounts are maintained and audited. Proprietors eligible for and opting under Section 44AD (business) or Section 44ADA (specified professions) can file the simpler ITR-4 (Sugam) without maintaining detailed books. The applicable form depends on turnover and the taxation scheme opted.

GST registration is mandatory for a sole proprietorship if aggregate turnover exceeds ₹40 lakh (goods) or ₹20 lakh (services) in a financial year, or if the business makes inter-state supplies irrespective of turnover. Once registered, GSTR-1 and GSTR-3B must be filed regularly.

Professional Tax is a state-level levy on individuals engaged in a profession, trade, or employment. It is levied by states including Maharashtra, Karnataka, West Bengal, Andhra Pradesh, Tamil Nadu, and others. The rate and compliance requirements vary by state — most require registration and periodic payment.

Yes — a sole proprietorship can be converted to a private limited company through a slump sale or business transfer route. The proprietor incorporates a company, transfers the business assets and liabilities, and the proprietorship ceases to operate. Tax implications of the transfer must be assessed before proceeding.

Yes — under Section 44AA of the Income Tax Act, a proprietor carrying on business or profession above prescribed turnover or income limits must maintain specified books of account. Where turnover exceeds ₹1 crore (business) or ₹50 lakh (profession), a tax audit under Section 44AB is also mandatory.

Need your proprietorship's annual compliance managed?

We'll handle your GST returns, income tax filing, advance tax, professional tax, Shop Act renewal, and Udyam registration — all deadlines tracked.