The sole proprietorship or sole traders is a type of enterprise that is owned and run by an individual. This is a type of business where there is no legal difference between the business entity and the owner.
However, Sri Lanka is an excellent place for this kind of business. To register your sole proprietorship in Sri Lanka, you need to follow some documented procedures.
Firstly, you need to head to the– “Business Registration Department” within your region to collect the application form.
The application form is a 3-page document. The first two pages of the document are written in Tamil and Sinhalese with English translation. But the 3rd page of the document is written in Tamil and Sinhalese. If you don’t know Tamil or Sinhalese, you need to find someone who can translate Sri Lankan Local language.
List of Document for Sole Proprietorship Registration
You will need to prepare and submit various types of document to register your sole proprietorship. All the listing of documents is discussed below –
Completed form of application– The necessary application form can be downloaded from the government website, or it can also be collected from the government office of company registration. You will be asked to print the application double sided to minimize the page number.
Validation form Grama Niladhari and Grama Sevaka– It is required to sign the 3rd page of the application from Grama Niladhari and Grama Sevaka, to verify your business address. Generally, they will check the owner of the property, i.e., address within your application. If they found the owner of the property is valid, they will sign your form.
Letter of consent from a resident owner– There is no need of consentient letter if the deed is in your name. But if you are a renter, you need to sign the consent letter from the resident owner. Copies of resident owner id card & copies of applicant id card must be submitted with consent letter.
House tax invoice copy – this is required for confirming the resident of the stated address.
Original deed–only for the revision in the validation of the property of the declared business address.
Important Points to Note
You must submit the application within 14 days after the signing of Grama Niladhari and Sevaka. If you failed to submit the application within the time period, you would be fined LKR 2500 for per day delay. The government fees for registering a sole proprietorship is LKR 2500.
My Personal Experience
When I submit my forms, the officer in the registration department noticed that I had a delayed for five months. The officer directed me to another gentleman who was very polite and helpful. He explained to me everything about the policies for business registration. However, I managed to convince him and paid fine of just 4500 LKR for the delay. The gentleman took my number and call me next evening saying my registration document is ready.
Advantage of a Sole Proprietorship
Control: Sole trader have the full power of their business. They can run the business without the interface of others.
Private Information: the confidential information of the sole traders can be kept private, unlike other companies who need to make a public announcement after company registration.
Personal: Since it is not necessary to discuss with other decision makers, sole traders can quickly make decisions and act quickly to meet the needs of their customers.
Disadvantages of a Sole Proprietorship
Decision Making: sole traders make all the decision. There are no opportunities to get help from others. The success or the failure of the company depends on one person.
Finance: sole trader may find difficulties to raise the fund of their business. Sometimes they may face problems with the expansion of their business.
Beside Sole Proprietorship, there are lots of business opportunities in Sri Lanka such as- Private Limited Company, Joint Venture, Limited Liability Company, etc. The recent economic development of the country helps to attract many foreign entrepreneurs to establish a business in Sri Lanka. Do not worry about registration procedures. The government of Sri Lanka made the registration procedure much more comfortable by introducing an online portal for the company registration.
However, like Sri Lanka, there are also many business opportunities in Malaysia. As the economy of Malaysia growing steadily over the years, therefore most of the foreign business entities think doing business in Malaysia could be profitable. The company registration procedure in Malaysia is not complicated if you know the actual process. It doesn’t matter whether you start your business in Malaysia or Sri Lanka, a right business plan is necessary to achieve your business goals.