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Udyam MSME Registration in India

UDYAM Registration OR MSME Registration

What is Udyam Registration?

MSME Registration, also known as an Udyam Registration, consists of a government’s approval in the form of a unique number as well as a Recognition Certificate. Obtaining this is crucial if you want to certify that your small or medium business is legitimate and functional.

Is Udyog Aadhar and Udyam the same?

No, Udyog Aadhar and Udyam are two independent initiatives, despite being independent initiatives, the Udyam and Udyog Aadhar registration processes are remarkably similar. Getting an Udyog Aadhar may be a simple way to register for Udyam. So, once you have your 12-digit Udyog Aadhar number, you can quickly and conveniently apply for udyam registration. Some key differences between the two initiatives are;

  • While Udyog Aadhaar is not fully integrated with other government portals like Gem, Udyam registration is.
  • For the registration process, the Udyam Portal has a longer form than Udyog Aadhaar and requests data from the Income Tax and GST authorities.
  • Udyam registration just needs the Aadhaar card that is connected to a mobile number, whereas Udyog Aadhaar can be sought for without the Aadhar Mobile Link Facility.
  • It is possible to create many Udyog Aadhaar accounts under various corporate names, but then only one Aadhaar Card Person Applicant may register for Udyam.

What is the unit name in Udyam?

The classification of MSMEs (Udyam) was modified as part of the COVID-19 rescue package known as "Atmanirbhar Bharat" to categorize them based on their revenue rather than only the amount of money they invested. There will no longer be a distinction between MSMEs (Udyam) providing services and those providing goods under the new definition. The unit classification in Udyam is as follows:

  • Micro units: Businesses with up to Rs 1 crore of investment and less than Rs 5 crore of annual turnover.
  • Small units: Those businesses with up to Rs 10 crore of investment and less than Rs 50 crore of annual turnover.
  • Medium units: Those businesses with up to Rs 20 crore of investment and less than Rs 100 crore of annual turnover.

What is the monetary limit in the Udyam certificate?

On June 26, 2020, the Government of India published a notification outlining updated criteria and a threshold limit for categorizing businesses as Micro, Small, and Medium under the MSME Act, 2006 that would be effective from 1st July 2020. The summary for the aforementioned significant notification is as follows: Monetary limit for both i.e., Manufacturing and service sectors

Classification Micro enterprises Small enterprises Medium enterprises
Investment limit (for the plant, machinery, and equipment) Less than Rs. 1 Crore Between Rs. 1 Crore to 10 Crore Between Rs. 10 Crore to 50 Crore
Turnover limit (Export of sale to be excluded) Less than Rs. 5 Crore Between Rs. 1 Crore to 25 Crore Between INR 25 to 250 Crore
  • For new businesses without an ITR, the investment will be based on self-declaration.
  • Information about turnover or export turnover must be linked to the Income Tax Act or the GSTN.
  • The enterprise's turnover-related numbers that don't have PAN will be taken into account based on self-declaration.
  • MSME Registration would be known as Udyam and permanent identification number would be referred to as “Udyam Registration Number”

Can a trader register under MSME?

Yes, one way to become an MSME—a term used to describe businesses that fall under micro, small, and medium enterprises—is to register for an Udyam certificate online. Traders who fall under one of three MSME classifications are qualified to apply for MSME.

How do I register MSME?

Businesses must register on the "Udyog Aadhaar Memorandum (UAM) portal" in order to receive the government-announced benefits for MSMEs. Every user may register for free and the process is pretty straightforward. To register your business online, follow these steps:

  • 1. Visit the UAM portal and fill out the form.
  • 2. Tap the first link on the page or just "click here" to open the form if you're registering your company as an MSME for the first time.
  • 3. Click "Validate & Generate OTP" after entering your name and Aadhaar number.
  • 4. You need to enter the PAN card information after verification is complete. If you don't yet have a PAN card, choose No instead.
  • 5. After that, you will need to complete the form with fields 5 to 24.
  • 6. Your phone will once again receive an OTP request after you submit the form. To be able to correctly submit the form, you need to enter the OTP and verification code received on the registered contact number and email id.
  • 7. Upon successful registration, a "Thank You" message and registration number will appear. For future use, keep that number handy.
  • 8. It may take several days for the approval and registration to be completed after the application form is submitted.
  • 9. If your application is accepted, your registration would be done, and you will receive your MSME certificate through email.

Who is eligible for udyam registration?

Who is eligible under MSME?

The similarity in investment amount and annual turnover between businesses operating in the manufacturing and service sectors has eliminated the differentiation between these two types of businesses. Merged Investment and Annual Turnover Eligibility Criteria for MSME

Type of sector/Enterprise Micro enterprise Small enterprise Medium enterprise
Both i.e., Manufacturing and service sectors Investment amounting to less than INR 1 crore and turnover of less than Rs. 5 crore Investment amounting to less than INR 10 crore and turnover up to Rs. 50 crore Investment of less than INR 50 crore and turnover up to Rs. 250 crores
What is the turnover limit for Udyam registration? The turnover limit for udyam registration is as follows:
Enterprise Turnover limit
Micro enterprise Five Crore
Small enterprise Fifty Crore
Medium enterprise Two Hundred and Fifty Crore

Is GST compulsory for Udyam registration?

As per the Ministry of MSME, every enterprise must register for GST and update their Udyam Registration portal before March 31, 2021. Any Udyam whose Udyam Registration Number is not GST-compliant after April 1, 2021, would have its udyam Registration number revoked.

Who can get Udyog Aadhar?

All small, medium, and micro enterprises falling under the manufacturing or service sectors are eligible to apply for the Udyog Aadhaar.

Is MSME and Udyam registration same?

MSME registration and Udyam registration are quite the same. It is a form of government's official accreditation for small, medium-sized firms or enterprises. Udyam recognition certificate consists of a twelve-digit Unique Identification Number on it. Aadhaar for business is another name for it. The Ministry of Micro, Small, and Medium Enterprises (MSME Ministry) provides the registration certificate in an effort to benefit small and medium businesses.

Businesses engaged in the production, processing, preservation, or provision of services are eligible to apply for Udyam Registration. For instance, traders that purchase, sell, import, or export eligible materials

What is the validity of UAM?

Businesses that are currently operating under the MSME category can continue to use their Udyog Aadhaar Memorandum (UAM) registrations. The Ministry of MSME has announced an extension to the Udyog Aadhaar Memorandum (UAM) validity up to 31st March 2022. This decision is made to help UAM holders to avail benefits of the provisions under various existing schemes and initiatives including Priority Sector Lending benefits of MSME.

What is the benefit of Udyam registration?

Some of the benefits of Udyam registration are as follows:

  • 1. Small firms can more easily get government contracts by registering as an Udyam.
  • 2. Small and medium-sized businesses have access to bank loans with reduced interest rates. Under Udyam Registration, they are eligible for interest rates that are up to 1.5% cheaper than those on standard loans.
  • 3. Regardless of the type of business, it helps enterprises to quickly obtain licenses, approvals, and registrations.
  • 4. In order to get government incentives, MSMEs registered under the Udyam Registration scheme are given higher preference.
  • 5. It makes it simple to obtain loans with low-interest rates.
  • 6. Tax, capital subsidies, and tariff subsidies are all available to small and medium-sized firms.
  • 7. Through rebates and discounts, it greatly lowers the costs associated with obtaining a patent or the cost involved in establishing a business.

Is GSTIN mandatory for udyam?

According to a notification from the Ministry of Micro, Small, and Medium Enterprises (MSME), the GSTIN is not required for MSME Udyam registration. The government had previously said that PAN and GSTIN would be mandatory commencing from March 31, 2021, for MSME Udyam registration, but it has now eased the criteria and stated that the exemptions from the GSTIN requirement shall be as per the provisions of Central Goods and Services Tax Act of 2017.

What is Udyog registration for companies?

The Udyog Registration, often referred to as MSME Registration, is simply a government registration that comes with a recognition certificate and a unique 12-digit identification number (also known as Udyog Aadhar) provided by the Ministry of MSME.

This is done to certify small and medium-sized businesses. The main reason for bringing this facility is to give the government a mechanism of giving the maximum benefits to medium- or small-scale firms or industries in India that are registered as MSME through their Aadhar Card Number.

The business's owner, director, or proprietor must provide their 12-digit Aadhar number. Regardless of the type of business whether it is a sole proprietorship, LLP, private limited company, etc., this rule is obligatory. The entity should have the recognition certificate that was issued as part of the MSME registration procedure.

What is the full form of MSME?

MSME is an acronym that stands for Micro, Small, and Medium Enterprises.

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