Starting a Business in Punjab: Choosing a Structure and Local Registrations

Choosing a structure and incorporating works the same way across India. But starting a business in Punjab also means dealing with state registrations and local authorities, and knowing the local startup ecosystem. This guide covers the local side.

Incorporation and the ROC

Companies and LLPs with a registered office in Punjab are registered with the Registrar of Companies, Chandigarh. The registered office can be a home, a co-working space, or an office, with the right address proof.

State Registrations

• Professional Tax: Punjab doesn't call it professional tax, but levies a State Development Tax on people earning income from professions, trades and employment, including salaried employees. Employers deduct it from salaries. Check the current rate and process with the state Taxation Department.
• Shops and Establishments: Punjab's shops and commercial establishments law applies to offices in the state. Register with the Labour Department.
• Trade licence: Depending on the business, an office within Ludhiana, Mohali or another municipal area may need a licence from the local body.
• GST: registration once turnover crosses the threshold, or immediately in compulsory cases. In Punjab, the threshold is ₹40 lakh for goods and ₹20 lakh for services.

Industrial and Manufacturing Units

Manufacturing and industrial units need further approvals — building permissions, fire safety, pollution control consents, factory licences, and power connections. In Punjab, the Invest Punjab single-window system brings many of these together. Industrial land is often allotted through PSIEC (Punjab Small Industries and Export Corporation).

The Startup Ecosystem

Startups in Punjab are concentrated around Mohali and Ludhiana. Local support includes:

• Startup Punjab: the state's startup programme.
• Incubation at institutions such as IIT Ropar.
• Proximity to Chandigarh's tricity ecosystem.

Startups can also apply for DPIIT recognition nationally, and explore the state's policies for startups and innovation.

Choosing a Structure

The choice of structure doesn't depend on the state, but local factors can matter: state incentives may be tied to the entity that applies for them, and land allotments may restrict transfers, so it's best to set up the long-term entity before applying for either.

A Checklist for Founders in Punjab

1. Choose the structure based on funding plans and risk.
2. Incorporate with the ROC, or set up the proprietorship's registrations.
3. Register under Shops and Establishments where it applies.
4. Get a trade licence for your premises.
5. For manufacturing, apply for approvals through the Invest Punjab single-window system.
6. Explore local incubators and startup programmes.

Getting Help

Think Filing helps founders start businesses in Punjab, from incorporation to state registrations.