Starting a Proprietorship in Gujarat: Shops and Establishments, PT and Trade Licence

A proprietorship doesn't need incorporation, but it does need the right registrations — and in Gujarat, several of those are state and local. This guide covers what a proprietor in Gujarat typically needs.

Shops and Establishments Registration

The Gujarat Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2019 applies to commercial establishments. Larger establishments register with the Labour Department, while smaller ones may only need to give intimation, depending on the number of workers. It's one of the documents banks commonly accept as proof of your business for a current account.

Professional Tax

Gujarat levies Professional Tax. As a proprietor, you enrol and pay PT for yourself, and if you employ staff, register as an employer to deduct and pay PT on their salaries.

Trade Licence

Depending on the business, a shop or office within Ahmedabad, Surat, Vadodara or another municipal corporation may need a licence from the local body. It's tied to your premises and usually renewed every year.

GST

Register for GST once your aggregate turnover crosses the threshold. In Gujarat, the threshold is ₹40 lakh for goods and ₹20 lakh for services. Register earlier if you make inter-state supplies of goods or sell through e-commerce platforms.

Udyam

Udyam registration is free and gives you MSME status, with protection on delayed payments and access to the Gujarat Micro and Small Enterprises Facilitation Council.

Sector Licences

• Food businesses: FSSAI registration or licence.
• Pharmacies: drug licence from the state drugs control authority.
• Importers and exporters: IEC.

Bank Account

With two registrations in the business's name — for example, Shops and Establishments and Udyam, or GST — you can open a current account in your trade name.

A Checklist for Proprietors in Gujarat

1. Register under the shops and establishments law.
2. Enrol for Professional Tax.
3. Get a trade licence from your local body.
4. Register for GST when you cross ₹40 lakh for goods or ₹20 lakh for services, or earlier if required.
5. Get Udyam registration.
6. Open a current account in the trade name.

Getting Help

Think Filing sets up proprietorships in Gujarat with all the state and local registrations they need.