Learn about non-trading enterprises in Udyam registration for small and medium-sized businesses in India. Discover how non-trading businesses can register under Udyam and what activities they typically engage in. Find out more about the criteria for registering as a micro, small or medium enterprise, and the benefits of Udyam registration. Get all the information you need to understand non-trading in Udyam registration and how it could apply to your business.
Udyam registration is a government registration process for small and medium-sized enterprises (SMEs) in India. “Non-trading” refers to businesses that are registered under Udyam but are not engaged in any trading activities, such as manufacturing or providing services.
In Udyam registration, a business can register itself as a micro, small or medium enterprise based on the criteria of its investment in plant and machinery or equipment, and its turnover. If a business is not engaged in any trading activities and does not have any investment in plant and machinery or equipment, it can still register under Udyam as a non-trading enterprise.
Non-trading enterprises may be set up for various reasons, such as holding and managing assets, investment purposes, or as special purpose vehicles for specific projects. These enterprises may not have any employees, or may have only a few employees who are involved in administrative or management roles.
What is non-trading service?
Non-trading service refers to a type of service provided by a business that does not involve the buying or selling of goods or physical products. Instead, non-trading services involve providing intangible services such as consulting, education, healthcare, transportation, hospitality, and other types of services. Unlike trading services, which involve the exchange of goods or products, non-trading services are focused on delivering intangible value to customers. Many businesses in the service sector, such as consulting firms, educational institutions, and healthcare providers, fall under the category of non-trading services.
What is non-trading service in Udyam?
Udyam registration, non-trading service refers to businesses that provide services without engaging in trading or manufacturing activities. This includes businesses that offer professional or technical services, such as consulting, legal or accounting services, or businesses that provide other types of services, such as healthcare, education, and hospitality. Non-trading service enterprises can register for Udyam, provided they meet the eligibility criteria and requirements laid out by the Ministry of Micro, Small and Medium Enterprises (MSME).
The Udyam registration process for non-trading service enterprises is generally simpler and involves providing basic details about the enterprise, its owner(s), and other relevant information. Once registered, non-trading service enterprises can access the benefits provided under the Udyam scheme, such as government recognition, access to government schemes and incentives, and participation in government tenders, among other benefits.
What are the documents required for non-trading in Udyam registration?
The documentation requirements for non-trading Udyam registration are generally simpler than for trading enterprises. Here are the documents typically required for non-trading Udyam registration:
- Aadhaar card of the proprietor/partner/director(s)
- Pan card of the proprietor/partner/director(s)
- Bank account details of the business
- Proof of business address (such as electricity bill, telephone bill, or rent agreement)
- Self-declaration stating that the business is not engaged in any trading activities
It’s important to note that the specific documentation requirements may vary based on the type and size of the business. For example, if the non-trading business is a company, it may need to provide additional documentation such as the Certificate of Incorporation, Memorandum of Association, and Articles of Association.
It’s recommended to review the latest guidelines and requirements from the Ministry of Micro, Small and Medium Enterprises (MSME) for accurate and up-to-date information on the documentation requirements for non-trading Udyam registration.
What is the process for non-trading in Udyam registration?
The process for non-trading Udyam registration is similar to the process for trading businesses, but with a few differences. Here are the steps to register a non-trading enterprise under Udyam:
- Visit the Udyam registration website
- Create an account by providing your name, Aadhaar number, and other required details.
- Provide the necessary information about your business, such as the name of the enterprise, the type of organization (e.g. sole proprietorship, partnership, limited liability partnership), and the business address.
- Provide details of the proprietor/partner/director(s) of the enterprise, including their name, Aadhaar number, and PAN number.
- Provide information about the business activity and investment in plant and machinery or equipment (which is not applicable for non-trading enterprises).
- Upload the required documents, such as the Aadhaar card, PAN card, and bank account details of the proprietor/partner/director(s), as well as the proof of business address and self-declaration stating that the business is not engaged in any trading activities.
- Review the information provided and make any necessary corrections.
- Submit the application and make the payment of the applicable registration fee.
- After the application is successfully processed, the Udyam registration certificate will be issued, which contains the Udyam registration number and other relevant information.
Note: During the process you need to share OTP code with the verification team for further process of the udyam certificate.
It is important to remember that the registration process and requirements for Udyam for non trading enterprises may change over time. It is recommended that you review the Ministry of Micro, Small, and Medium Enterprises’ (MSME) most recent guidelines and requirements for accurate and up-to-date information on the process of non-trading Udyam registration.
What are the benefits for non-trading enterprises by Udyam registration certificate?
While non-trading enterprises may not have significant operational or trading activities, Udyam registration can still offer several benefits. Here are some of the benefits of Udyam registration for non-trading enterprises:
- Government recognition: Udyam registration provides government recognition of the enterprise, which can help establish its credibility and reputation.
- Access to government schemes and incentives: Non-trading enterprises registered under Udyam may be eligible for various government schemes and incentives, such as subsidies, tax benefits, and loans, which can be useful for investment purposes.
- Reduced compliance burden: Udyam registration simplifies compliance for the enterprise by providing a single registration platform for various regulatory compliances such as Goods and Services Tax (GST), Employees’ Provident Fund (EPF), and Employees’ State Insurance (ESI). This can help non-trading enterprises save time and effort on compliance procedures.
- Easy credit availability: Udyam registration can help non-trading enterprises avail credit more easily from banks and financial institutions, as the registration certificate is seen as a trustworthy and reliable document.
- Participation in government tenders: Udyam registration is a mandatory requirement for participating in government tenders, even if the enterprise is a non-trading business. Therefore, registration can help the enterprise participate in government tenders and access new business opportunities.
The potential benefits of Udyam registration may differ depending on the size, type, and location of the business. For accurate and up-to-date information on the benefits of Udyam registration for non-trading enterprises, it is recommended to review the Ministry of Micro, Small, and Medium Enterprises’ (MSME) latest guidelines and requirements.
Is non trading business mandatory for udyam registration ?
No, having a non-trading business is not mandatory for Udyam registration. Udyam registration is a process initiated by the Ministry of Micro, Small and Medium Enterprises (MSME) in India to provide various benefits to small and medium enterprises.
The eligibility criteria for Udyam registration include the turnover of the enterprise and the investment made in plant and machinery or equipment. There is no requirement that the enterprise must be engaged in trading or non-trading activities.
However, it is important to note that Udyam registration is only applicable to enterprises engaged in manufacturing or service activities, and now even trading activities businesses also get udyam certificates. Click here for MSME registration for traders.
What is the difference between trading and non trading in udyam registration?
In MSME Udyam registration, the terms “trading” and “non-trading” refer to the different types of business activities that an enterprise can be engaged in.
- Trading activities: involve buying and selling goods or services. In other words, trading enterprises buy goods or services from one party and sell them to another party, without making any significant changes to the products or services. Examples of trading activities include wholesale and retail trading, distribution, and trading of goods or services online.
- Non-trading activities: involve providing services or manufacturing goods, rather than buying and selling them. Non-trading enterprises are engaged in activities that create or transform products or services. Examples of non-trading activities include manufacturing, software development, professional services, consultancy, and other service-based industries.
For the purpose of Udyam registration, an enterprise engaged in trading activities is not eligible for registration as a micro, small, or medium enterprise. The registration is only applicable to enterprises engaged in manufacturing or service activities. This is because trading activities do not involve any significant value addition or employment generation, which are the main objectives of the Udyam registration scheme.
In conclusion, Udyam registration is a valuable process for non-trading enterprises in India, as it provides government recognition, access to government schemes and incentives, reduced compliance burden, easy credit availability, and participation in government tenders. While the documentation requirements and process for non-trading Udyam registration may be simpler than for trading businesses, it’s important to ensure that all requirements are met to successfully register and take advantage of the benefits.
As Udyam registration guidelines and requirements may change over time, it’s recommended to regularly review the latest information from the Ministry of Micro, Small and Medium Enterprises (MSME) to stay up-to-date on the process and benefits of Udyam registration for non-trading enterprises.
As a private Udyam registration consultant, we provide expert assistance and guidance to businesses seeking Udyam registration in India. Our team of professionals are well-versed in the Udyam registration process and are dedicated to helping businesses, including non-trading enterprises, navigate the registration process with ease. We ensure that the necessary documents are in order and provide timely guidance and support to help businesses complete the registration process smoothly. Our aim is to help businesses take advantage of the benefits offered by Udyam registration and to make the process as stress-free as possible. With our extensive knowledge and experience, we offer reliable and efficient services to help businesses achieve Udyam registration in a hassle-free manner.