Business Licenses in India

Business Licenses in India

Common List of Licenses required to run a business in India.

PAN - Permanent Account Number

  • Used for income tax purposes. Mandatory if you have a taxable income. PAN has now been made mandatory to be quoted for most of the financial transactions. Tax is now deducted at a higher rate for people not having a PAN.

TAN - Tax Collection & Deduction Account Number

  • Used for deducting taxes. If you are paying a salary, or making payments for variety of purposes like consultancy fees, rent, contractual payments etc. the tax should be deducted at source and paid to income tax department. TAN is mandatory to deduct taxes.

Shops & Establishment License.

  • State based license. Applicable if you are opening a shop or commercial establishment. Please refer to your State laws for more details.
  • Fees vary for no. of people employed

Importer Exporter Code - IEC

  • If you are engaged in commercial transaction internationally, IEC must be obtained.
  • Custom formalities should be complied for any import or export of goods.
  • No regular returns required to be filed
  • Valid for lifetime
  • IEC can be obtained only once on 1 PAN. Multiple IEC are not issued to a single entity/ PAN

Professional Tax

  • State based tax for employing professionals. Many states like Delhi, Rajasthan and Union Territories etc. donot have professional tax. Check you respective tax laws for applicability of professional tax.
  • Monthly returns need to be filed, wherever applicable

Provident Fund

  • Applicable if you hire 20 and more employees
  • Monthly returns need to be filed

ESI - Employee State Insurance

  • Applicable if you hire 10 and more employees (for power using establishments) or 20 and more employees (for non power using establishments) drawing a salary upto Rs.15000 per month.



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