Why register for trade License?
A trade license is a document/certificate issued by the Municipal Corporation of respective state government which provides the permission to the individual (person seeking to open a business) to start explicit/a specific/a selected trade or business in a very particular area/location.
However, the license doesn’t permit the holder to the other trade or business than for it is issued. Moreover, this license doesn’t die any reasonably property possession to the holder of the license.
Benefits of trade License
Following are the advantages and perks of trade license:-
- As comparative to unregistered entity, a licensed business attract more customers and investors as it have greater goodwill
- Protection to owner against certain types of Liabilities
- To practice the business ethically a person can apply for trade license registration
- It increases credibility as it gives an assurance to the customers that the organization is law abiding entity,
- It renders better exposure to financial aid. Every organization needs funds at some point in time to ensure growth and enhanced productivity. Under the influence of the trade license, any entity can secure loans from the financial institute without messing up any constraints. Generally speaking, a trade license can act as a substantial gateway that ensures the seamless inflow of financial aid, which, in turn, triggers the organization’s development. Perhaps this is an unparalleled benefit of a trade license that one could ever come across.
- It simply discourages unethical practices
- It is compulsory for all the businesses generating revenue through their product and services. Such a license gives the customers assurance that the organization is a law-abiding entity committed to ethical business practices. Also, this license increases the visibility of the entity within the market in which it is operating. Consequently, this would let the entity establish trust among its target consumer over time.
Categories of trade license:-
There are mainly 3 main category of trade license:-
If you would like to open a store or an institution to sell product and services then you ought to choose shop license
This type of license is needed for a corporation that wishes to open a small or mid-sized industrial unit.
Food Establishment License
Any institution that plans on stepping into the food and beverage industry needs this license. The license applies to restaurants, cafes, meat shops, bakeries and vegetable outlets.
Registration Requirement for Trade License
Following are the said eligibility requirement of trade license:-
- The applicant must be of age of 18 years or above
- The applicant must not have any criminal records
- The business proposal should be legally acceptable
Procedure to obtain trade licence
The license can be obtained either by online or via offline mode. The application can be filled online by visiting the Urban Local Bodies portal of the particular state and uploading the requisite documents and making the payment online.
Further in offline procedure the following steps are required to be taken:-
- Visit the license department ranging from a particular municipal unit and request the executive to apply for trade license
- Fill the application with the required details along with all the supporting documents.
- Pay the requisite fees and a transaction number is generated on the registered mobile number
- Successful registration will be informed on the registered mobile number.
Renewal of the Trade License:
As the validity of the trade license issued by the municipal authority is for a period of one year it is required to be renewed every year in between 1st January to 31st March.
The application for renewal is required to be made within 30 days from the date of expiry of the license.
In case of any delay in the renewal process of the license, then the respective authority might take an action against the person by imposing fine depending upon the rules and regulation.
Following are the documents that needs to be submitted for renewal of the license
- Original copy of the trade License;
- Previous year challans;
- Up to date property tax paid receipt.
Documents Required to obtain trade license
- Address Proof & Identity Proof of the Applicant
- Certificate of Incorporation, AOA and MOA of the company
- Cancelled Cheque and Bank Statement
- Income Tax return and Property Tax Receipt
- Documentary proof of establishment of trade
- Legal Occupancy document proof of the establishment or unit or allotment letter provided by the government agency
- Lease Deed/ Rent Agreement of the premises, if taken on lease or rent
- No Objection Certificate/ NOC from the land-owning agency
- Documentary proof for the non-existence of unauthorized construction
- PAN for the entity