MSME stands for micro, small and medium enterprises and any enterprise that falls under any of these three categories. MSME enterprises are the backbone of any economy and are an engine of economic growth, promoting equitable development for all. Therefore, to support and promote MSMEs, the Government of India through various subsidies, schemes and incentives promote MSMEs through the MSMED Act. To avail the benefits under the MSMED Act from Central or State Government and the Banking Sector, MSME Registration is required.
Micro, Small and Medium sized enterprises in both the manufacturing and service sector can obtain MSME Registration under the MSMED Act. Though the MSME registration is not statutory, it is beneficial for business at it provides a range of benefits such as eligibility for lower rates of interest, excise exemption scheme, tax subsidies, power tariff subsidies, capital investment subsidies and other support. ComplianceIndia can help your business obtain MSME Registration to avail a host of benefits.
Our charges for MSME Registration starts from Rs.4999/-.
VAT is value added tax, a tax levied on the sale of goods in India. Each State in India has unique VAT Regulation and different tax rates are applicable for different types of products. Therefore the VAT Tax Rate and Exemptions will be unique to each State and type of goods sold.
MSME Registration can be obtained by business in the manufacturing or service sector. To be classified as a MSME, Enterprises in the Manufacturing sector need to have less than Rs.10 crores of investment in plant & machinery; service Enterprises must have an investment of less than Rs.5 crores of investment in plant & machinery.
A Micro Enterprise in the manufacturing sector is an enterprise with less than Rs. 25 lakhs of investment in plant & machinery. A Micro Enterprise in the service sector is an enterprise with less than Rs. 10 lakhs of investment in plant & machinery.
A Small Enterprise in the manufacturing sector is an enterprise with more than Rs. 25 lakhs but not exceeding Rs. 5 crores of investment in plant & machinery. A Small Enterprise in the service sector is an enterprise with more than Rs. 10 lakhs but not exceeding Rs. 2 crores of investment in plant & machinery.
A Medium Enterprise in the manufacturing sector is an enterprise with more than Rs. 5 crores but not exceeding Rs. 10 crores of investment in plant & machinery. A Medium Enterprise in the service sector is an enterprise with more than Rs. 2 crores but not exceeding Rs. 5 crores of investment in plant & machinery.
MSME Registration has a range of benefits implemented as subsidies, schemes and incentives. Enterprises registered with the MSMED Act enjoy interest rate concession and their borrowing is classified under Priority Sector Lending. Enterprises registered with the MSME act are also allowed to avail a number of subsidies and schemes floated by the State and Central Government. Some of them include, subsidy for ISO registration, subsidy for obtaining International patents, subsidy for participating in tradeshow, subsidy for implementing barcode on Products, etc.,
To obtain MSME registration, proof of address of business, proof of identity of the promoters and constitution of the business [Partnership deed, Incorporation Certificate, etc.,] is required. Additional documents may be required based on the State in which the MSME Registration is sought.
MSME Registration process is state specific. Therefore based on the state, the MSME Registration processing time differs. MSME Registration can typically be obtained in 10 to 15 working days.
MSME Registration is first provided as a Provisional Registration Certificate with a validity of 5 years. Once, the unit has commenced production, a Permanent Registration Certificate is issued which is valid for lifetime of the entity.
If the business grows and investments more than Rs.10 crores in plant and machinery in case of manufacturing entity and more than Rs.5 crores in plant and machinery in case of service entity, the enterprise should apply for de-registration.