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UDYAM Registration

The Udyam Registration is the new process for Micro, Small, and Medium Enterprises (MSMEs) in India to register themselves online with the government. It was launched on July 1, 2020, replacing the previous Udyog Aadhaar Memorandum (UAM). The primary aim is to simplify the registration process and create an integrated database of MSMEs to facilitate better targeting of government schemes and benefits.

 

Eligibility for Udyam Registration:

Any entity that qualifies as a Micro, Small, or Medium Enterprise can register for Udyam. The classification criteria are based on both investment in plant and machinery or equipment and annual turnover:

Enterprise Type                         Investment Limit in Plant & Machinery/Equipment                         Annual Turnover Limit

Micro                                                               Not exceeding ₹1 crore                                                       Not exceeding ₹5 crore

Small                                                               Not exceeding ₹10 crore                                                     Not exceeding ₹50 crore

Medium                                                         Not exceeding ₹50 crore                                                     Not exceeding ₹250 crore

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Who can apply?

  • Proprietorships

  • Hindu Undivided Families (HUFs)

  • Partnership Firms

  • One Person Companies (OPCs)

  • Private Limited Companies

  • Limited Liability Partnerships (LLPs)

  • Cooperative Societies

  • Any other legal entity

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Benefits of Udyam Registration:

Registering under Udyam offers numerous benefits to MSMEs, including:

  • Access to Government Schemes: Eligibility for various schemes and subsidies offered by the Central and State Governments to MSMEs.

  • Priority Sector Lending: Banks are mandated to classify MSMEs under priority sector lending, making it easier to access loans at potentially lower interest rates.

  • Collateral-Free Loans: Some schemes provide collateral-free loans up to a certain limit for registered MSMEs.

  • Tax Benefits: Potential exemptions and concessions under direct tax laws.

  • Preference in Government Tenders: Registered MSMEs may receive preference in participating in government procurement processes.

  • Protection Against Delayed Payments: Udyam-registered MSMEs can take action against buyers who delay payments beyond 45 days and can charge compound interest on the delayed amount.

  • Easier Approvals and Licenses: Preference in getting government licenses and certifications.

  • Reimbursement of ISO Certification Costs: Financial assistance for obtaining ISO certification.

  • Subsidy on Patent and Trademark Registration: Financial support for protecting intellectual property.

  • Electricity Bill Concessions: Potential discounts on electricity bills.

  • Stamp Duty and Registration Fee Waivers: Exemption from stamp duty and registration fees in some states.

  • Access to Online Portals: Integration with government e-Marketplace (GeM) and other platforms for business opportunities.

  • Carry Forward of MAT Credit: Entitlement to carry forward Minimum Alternate Tax (MAT) credit for a longer period.

 

Registration Procedure for Udyam:

The Udyam registration process is entirely online, paperless, and based on self-declaration. No documents need to be uploaded. Here's a step-by-step guide:

  1. Visit the Udyam Registration Portal: Go to the official website: [suspicious link removed].

  2. New Entrepreneur Registration: On the homepage, click on the option "For New Entrepreneurs who are not Registered yet as MSME" or a similar link.

  3. Aadhaar Verification:

    • Enter your 12-digit Aadhaar number and your name as mentioned on the Aadhaar card.

    • Click on "Validate & Generate OTP".

    • Enter the OTP received on your Aadhaar-linked mobile number and click "Validate OTP".

  4. PAN Verification:

    • After Aadhaar verification, you will be redirected to the PAN verification page.

    • Select the "Type of Organisation" and enter your PAN number.

    • Validate your PAN. You will also need to indicate if you have filed the previous year's Income Tax Return (ITR) and if you have a Goods and Services Tax Identification Number (GSTIN).

  5. Fill the Udyam Registration Form: The application form will appear. Fill in all the required details, including:

    • Name of the entrepreneur

    • Mobile number and email ID

    • Name of the enterprise

    • Location of plant(s)/unit(s)

    • Official address of the enterprise

    • Status of the enterprise

    • Bank details

    • Major activity of the unit (manufacturing or service)

    • National Industry Classification (NIC) code

    • Number of persons employed

    • Investment in plant and machinery/equipment

    • Turnover details

  6. Declaration and Submission:

    • Read the declaration carefully.

    • Click on "Submit and Get Final OTP".

    • Enter the final OTP received on your mobile number and click "Final Submit".

  7. Udyam Registration Number and Certificate: Upon successful registration, you will receive a unique Udyam Registration Number, and an e-certificate will be sent to your registered email ID. You can also download the certificate from the Udyam portal.

Key Points:

  • Aadhaar is Mandatory: For Udyam registration, the Aadhaar number of the proprietor, managing partner, or Karta (in case of HUF) is required. For companies, LLPs, Cooperative Societies, or Trusts, the Aadhaar number of the authorized signatory along with the organization's PAN and GSTIN is needed.

  • No Fees: The Udyam registration process is completely free of cost.

  • Self-Declaration: The registration is based on self-declaration, and no documents need to be uploaded.

  • Integration with Government Systems: The Udyam portal is integrated with Income Tax and GSTIN systems for seamless data verification.

  • Permanent Registration: The Udyam Registration has lifetime validity and does not require renewal.

  • Existing Registrations: Enterprises already registered under Udyog Aadhaar (UAM) were required to re-register on the Udyam portal by June 30, 2022.

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Benefits of UDYAM Registration

  • Easier access to loans and credit at subsidized rates

  • Protection against delayed payments through the MSME Act (i.e., the MSME Ministry’s support in cases of delayed payments by larger businesses)

  • Eligibility for government schemes such as:

    • Credit Guarantee Scheme

    • Prime Minister Employment Generation Programme (PMEGP)

    • Technology Upgradation Fund

    • Industrial Promotion Subsidies

  • Priority sector lending under RBI guidelines

  • Discounts on patent and trademark filings

  • Reduced rate of interest on loans from financial institutions

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