The MSMED Act allows all small-scale industries (SSI) or Micro, Small, and Medium Enterprises (MSME) to register. It is not required, but it will be useful if you do so. Priority sector lending, capital investment, and power tariff subsidies, as well as excise and direct tax exemptions, are among the many benefits. Manufacturing firms must invest less than Rs. 10 crores in plant and machinery, while service firms must invest no more than Rs. 5 crores in plant and machinery to qualify as MSME. If you have missed the investment deadline, you must cancel your registration under the MSMED Act at any time. You will learn more about SSI registration and MSME registration in this article.
What does SSI/MSME Registration entail?
Every country expects a certain amount of economic growth from its young and small firms. So, with this mindset, the Indian government provides several benefits to such firms, such as easy loans, cheaper credit, tax exemptions, and so on, in order to accomplish growth at a much faster rate and without facing adversities. However, in order to take advantage of these incentives, firms that qualify must first get an MSME or SSI registration (Regulated by the MSMED Act). The SSI/MSME registration is one of the simplest government registrations to obtain.
Let’s break it down into sections and talk about it. MSME is divided into two groups: small and medium-sized businesses (SMBs) and large businesses.
- Manufacturing Enterprises
- Service Enterprises
The table below shows the investment in Plant and Machinery/Equipment in terms of dollars:
Micro, Small, and Medium Enterprises:
Manufacturing Enterprises Rs 2,500,000 Less than Rs 50,000,000 Less than Rs. 100,000,000
Service Enterprises Less than Rs 10,00,000 Less than Rs 20,000,000 Less than Rs 50,000,000
Is SSI/MSME registration required or optional?
The only reason to register for SSI is to receive benefits and subsidies. As a result, it is entirely voluntary. Although it is a relatively simple registration to obtain quickly, many firms prefer it to other registrations.
Why should I apply before starting my business?
Because only a provisional SSI registration certificate is available (PRC). The provisional registration certificate will make it easier for the unit to secure term loans and operating capital through priority sector funding, as well as different NOCs and permissions from regulatory agencies including the pollution control board.
What documents are needed to register as an SSI/MSME?
The following are the paperwork needed to register as an MSME or SSI:
- Aadhar Card of the Applicant
- PAN card for a business
- Proof of business address, such as a lease agreement or utility bills.
- Name of the Owner
- The applicant’s classification
- Name and type of organisation
- Details of your bank account
- Details of the company’s previous registration
- Date and location of the company’s inception
- The company’s main business activity.
- The enterprise’s NIC code.
- Direct Industry Code’s location.
- The total number of people employed.
- Plant, equipment, and machinery are all investments.
What are the advantages of registering as an SSI/MSME?
- Tenders from the government are easy to get by.
- Obtain multiple licences and permits for your business with ease.
- In the case of a bank loan, a 15% import subsidy on fully automatic gear is available.
- Compensation for ISO certification.
- There is no requirement to file returns.
- Bills for electricity are subsidised.
- These are the priority lending sectors.
- Excise and direct tax legislation will be used to offer subsidies.
- Interest rates that are advantageous.
Why is it necessary to keep records?
Any SSI entity that does not follow the government’s regulations will be deregistered. Furthermore, if you exceed the investment limitations, your company’s registration will be revoked.
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