Do I Need to Register A Company Before Starting An Online Business?
In General NO! In most of the cases, there is no requirement to register a company before starting an online business. After the COVID-19 pandemic, one can expect to have an increase in the online purchasing of goods all around the world. If you are willing to sell any products online, it is the right time to start.
However, when registering your company before starting an online business is considered, it is not required at the beginning stage of one’s online business journey.
Firstly, understand how everything works (creation and maintenance of website/app, marketing, and payment methods), sell some of the products, and when the revenue is good enough, you can register the online business. In many cases, one can also experiment with the MVP (Minimum Viable Product) created at the initial stages before registering the online business.
Expected Time for Registering Business
If the online business is run with dedication, intelligence, and commitment, you could see the positive results after 3-4 months of time and this is the required time to register your online business.
Taxation in India on Businesses
An individual in India has a tax exemption if the income per annum is less than Rs. 2.5 lakh (Rs. 250,000). Legally, if you are selling something that is worth the amount of Rs. 2.5 lakh and above either offline or online you must pay taxes for the transaction and it is always better if the transaction is done through a company rather than an individual. Thus, you can also register the online business if the transactions cross Rs.2.5 lakh/annum.
Copyrights and Identity for Business
It is a must for any business either online or offline to register as it is the only way to protect the identity of the business and the products/services it sells. It also helps in generating copyrights for the products/services it creates. If one has competitors in the domain in which his/her online business exists, then registering the business is a must to avoid copyright issues.
Trust of customers
In general, a common customer would prefer buying products from a company rather than an individual. Though this may not be the case all the time, registering one’s online business would give an add-on advantage.
To know more about Online Business, read Why Customers Prefer Small and Medium Businesses With Online Presence