Starting a business is a big challenge. You not only have to decide on your budget, set goals, and create a strategy, but also achieve legal compliance. In addition to registering your business and obtaining the necessary licenses, there are several other compliances you must fulfill before starting a business. Depending on your industry and location, you may need to apply for a Business Registration Number (BRN). This article explains what BRN is, how to obtain it, and why it is necessary.
What is Business Registration Number (BRN)?
A BRN is a unique identifier, either a state tax ID number or a registered identification number. It provides a distinct identity to your business. Once you receive a BRN, concerned authorities can access all the details of your business activities online, making the registration process easier. A business registration number can either be a state employer identification number (EIN) or a registered identification number. Both serve as unique identifiers and can be obtained for free. Additionally, you may apply for BRN online to save time and simplify the process.
Advantages of BRN Registration
There are many benefits to obtaining a BRN, some of which are listed below:
Reputation with Customers:
- Building a reputation is challenging, especially for new businesses. Getting your business registered and obtaining a BRN gives customers confidence that they are dealing with a reputable organization.
- If your business operates online and requires customers to make payments before receiving goods or services, having a registered organization and a corporate account enhances credibility and trust.
Opening a Corporate Bank Account:
- A BRN simplifies the process of opening a corporate bank account.
- A corporate account improves trust among customers, banks, suppliers, and business partners.
Access to Loans:
- Registering your business and obtaining a BRN makes it easier and faster to access loans compared to businesses without a BRN.
- With a BRN, you do not need to prove that you are running a legitimate business, increasing credibility and trust among investors and lenders.
Legal Protection:
- Having your company registered with the local or state government ensures that no other organization can register a business under the same name in the future.
Documents Required for Obtaining a BRN
To obtain a BRN and register your business, you will need the following documents:
- Digital Signature Certificate (DSC)
- Director Identification Number (DIN)
- Registration from the MCA portal
- Certificate of Incorporation
- Scanned copy of PAN Card
- Copy of Aadhaar Card
- Latest electricity bill
- Applicant’s photograph
- Bank statement of the organization
- Contact details (phone number, email address, etc.)
Basic Requirements and Options for Sole Proprietorship Registration
Registering a sole proprietorship business is a digital process that can be completed with expert assistance. A person interested in registering as a sole proprietorship must fulfill some basic requirements, such as opening a bank account in the name of the business entity.
Options for Sole Proprietorship Registration:
- Udyog Aadhaar under the Ministry of MSME
- Registration under the Shop and Establishment Act
- GST Registration
How to Obtain BRN Registration?
A business entity can apply for a BRN by following these steps:
- Visit the BRN registration portal.
- Select Registration > Apply for BRN. For NGOs/VOs, click on Apply BRN (For NGO).
- Read and accept the terms and conditions.
- Enter your mobile number, email ID, and Captcha Code, then verify.
- Enter the OTP received on your registered email ID.
- Select Apply BRN on the existing BRN search page.
- Fill in all required details.
- Upload the business owner's signature (JPEG format, up to 50 KB).
- Enter the name and address of your business premises, including PAN/TAN.
- Enter the name and address of your main business office (if applicable).
- Select the correspondence address for future reference (Applicant Address, Business Place Address, or Head Office Address).
- Provide a description of the major business activity and select the activity code from the provided list.
- Enter the year of starting operations (if not started, select "Not Started").
- Indicate whether annual accounts are maintained (Yes/No).
- Select the ownership code from the dropdown list (e.g., Proprietorship, Partnership Firm, Company, LLP, Self-Help Group, etc.).
- Enter the expected/working number of employees, including the owner.
- Provide the expected/proposed investment amount (in lakhs).
- Select applicable acts under which registration is required.
- Click the declaration checkbox and submit the application.
- After successful submission, print the application.
- The BRN will be auto-generated and sent to your registered mobile number and email ID.
Precautions While Applying for BRN
- Select Apply BRN for firms and Apply BRN (For NGO) for NGOs.
- Use your own mobile number and email ID to avoid BRN being registered under someone else’s name.
- If applying through Aadhaar, use the mobile number linked to your Aadhaar.
- Read the BRN tutorial before applying to avoid mistakes.
- Provide accurate details about the institution/firm in the identification particulars.
- Some information in the BRN application is auto-filled and non-editable, while the rest must be entered manually.
- Only fill in the Head Office details if applicable; otherwise, leave it blank.
- Choose the correct activity code that aligns with your business.
- If the BRN application is rejected, you can check the rejection reason under PRINT BRN and update it through UPDATE BRN without needing a fresh application.
- The BRN portal allows users to update or cancel their BRN online.
By following these steps, you can successfully register for a BRN and ensure compliance with legal requirements for running a business.