New MSME Udyam Registration Process and all you need to know

The government has organized a system to facilitate the registration of MSMEs. An enterprise for this process will be known as Udyam and its Registration Process will be known as ‘Udyam Registration’. A permanent registration number will be given after registration.

An enterprise shall be classified as a micro, small or medium enterprise based on the following criteria, namely:

• a micro-enterprise, where the investment in plant and machinery or equipment does not exceed one crore rupees and turnover does not exceed five crore rupees;
• a small enterprise, where the investment in plant and machinery or equipment does not exceed ten crore rupees and turnover does not exceed fifty crore rupees; and 
• a medium enterprise, where the investment in plant and machinery or equipment does not exceed fifty crore rupees and turnover does not exceed two hundred and fifty crore rupees.

After completion of the process of registration, a certificate will be issued online. This certificate will have a dynamic QR Code from which the webpage on the Portal and details about the enterprise can be accessed. There will be no need for renewal of registration. The Registration Process is totally free of cost.

Single window systems at Champions Control Rooms and DICs will help in the process.

Any person who intends to establish a micro, small or medium enterprise may file Udyam Registration online in the Udyam Registration portal, based on self-declaration with no requirement to upload documents, papers, certificates, or proof.

Basic Features of the New Udyam registration Process

• MSME registration process is fully online, paperless, and based on self-declaration.
• No documents or proof are required to be uploaded for registering an MSME, only an Aadhaar Number will be enough.
• PAN & GST linked details on investment and turnover of enterprises will be taken automatically from Government databases.
• The online system will be fully integrated with Income Tax and GSTN systems.
• PAN & GSTIN would be mandatory from 01.04.2021.
• Erstwhile EM-II or UAM registration or any other registration issued by any authority under the Ministry of MSME, will have to re-register under Udyam Registration.
• No enterprise shall file more than one Udyam Registration. However, any number of activities including manufacturing or service, or both may be specified or added in one Registration.

Did you know about the new Income tax portal? If not, check out our blog New Income Tax Portal 2.0

Benefits of getting Udyam registration:-

• Udyam registration helps in getting government tenders
• Due to the Udyam, the bank loans become cheaper as the interest rate is very low (Upto 1.5% lower than interest on regular loans
• There are various tax rebates available for Udyam
• Becomes easy to get licenses, approvals, and registrations, irrespective of the field of business as a business registered under Udyam are given higher preference for government license and certification.
• They get easy access to credit at lower interest rates
• Registered Udyams gets tariff subsidies and tax and capital subsidies
• Once registered the cost of getting a patent done, or the cost of setting up the industry reduces as many rebates and concessions are available.

New Registration Procedure:

• The form for registration shall be as provided in the Udyam Registration portal.
• There will be no fee for filing Udyam Registration.
• Aadhaar number shall be required for Udyam Registration.
• The Aadhaar number shall be of the proprietor in the case of a proprietorship firm, of the managing partner in the case of a partnership firm, and a Karta in the case of a Hindu Undivided Family (HUF).
• In the case of a Company or a Limited Liability Partnership or a Cooperative Society or a Society or a Trust, the organization or its authorized signatory shall provide its GSTIN and PAN along with its Aadhaar number.
• In case an enterprise is duly registered as an Udyam with PAN, any deficiency of information for previous years when it did not have PAN shall be filled up on a self-declaration basis.
• No enterprise shall file more than one Udyam Registration:
• Provided that any number of activities including manufacturing or service or both may be specified or added in one Udyam Registration.
• Whoever intentionally misrepresents or attempts to suppress the self-declared facts and figures appearing in the Udyam Registration or update process shall be liable to such penalty as specified under section 27 of the Act.

Udyam Registration Updates for existing MSMEs

• All existing enterprises registered under EM–Part-II or UAM shall register again on the Udyam Registration portal on or after the 1st day of July 2020.
• All enterprises registered till 30th June 2020, shall be re-classified by this notification.
• The existing enterprises registered before 30th June 2020, shall continue to be valid only for a period up to the 31stday of March 2021.

MSME plays a significant role in the growth of India’s economy by its contribution to the production, exports, and employment sector. They promote the industrialization of rural and backward areas, thereby reducing regional imbalances. The various schemes and incentives given to the MSMEs by the government encourage the proprietors for establishing and expanding their business ideas. 

For further details, please refer to the website: https://udyamregistration.gov.in

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