Why E-Commerce Businesses Need Company Registration
The Indian e-commerce market is projected to reach $200 billion by 2027. Whether you are selling on Amazon, Flipkart, Meesho, or your own D2C website, having a registered business entity is not optional - it is essential.
Why Registration is Mandatory for Online Sellers
- GST Registration Required: All e-commerce sellers must have GST registration regardless of turnover
- Marketplace Requirements: Amazon, Flipkart, and other platforms require GSTIN and business registration proof
- Payment Gateway: You need a company/LLP to integrate payment gateways on your own website
- Legal Protection: Limited liability protects personal assets from business risks
- Bank Account: You need a current account in the business name for receiving marketplace payouts
Which Business Structure for E-Commerce?
For Small Sellers (Monthly Revenue Under Rs 2 Lakh)
Recommended: Sole Proprietorship with GST
- •Lowest cost to start
- •Simple compliance
- •Suitable for testing products/market
For Growing Sellers (Monthly Revenue Rs 2-10 Lakh)
Recommended: Private Limited Company
- •Limited liability protection
- •Credibility with suppliers and marketplaces
- •Can raise funding for inventory
- •Easy to add co-founders
For Established Sellers (Monthly Revenue Above Rs 10 Lakh)
Recommended: Private Limited Company
- •Essential for scaling operations
- •Required for institutional funding
- •Brand building and IP protection
- •Multiple directors for operational management
Registration Checklist for E-Commerce Business
Step 1: Company Registration
Register a Private Limited Company or LLP:
- •Choose a name reflecting your brand
- •Register with at least Rs 1 lakh authorized capital
- •Cost: Starting Rs 1,499 with Setup India
Step 2: GST Registration (Mandatory)
GST is mandatory for all e-commerce sellers regardless of turnover.
Required details:
- •Company PAN and Certificate of Incorporation
- •Business address proof
- •Bank account details
- •HSN codes for your products
Step 3: FSSAI License (For Food Products)
If selling food items, you need:
- •Basic Registration: Turnover up to Rs 12 lakh (Rs 100/year)
- •State License: Turnover Rs 12 lakh to Rs 20 crore
- •Central License: Turnover above Rs 20 crore or importing food
Step 4: Trademark Registration
Protect your brand name and logo:
- •Cost: Rs 4,500 (DPIIT startups) or Rs 9,000 (others)
- •Duration: 10 years (renewable)
- •Essential for Amazon Brand Registry
Step 5: Import Export Code (IEC) - If Applicable
Required for importing products or exporting:
- •Free registration on DGFT portal
- •Required for customs clearance
Platform-Specific Requirements
Amazon India Seller Registration
- GST Registration (mandatory)
- PAN of business entity
- Bank account in business name
- Product listings with HSN codes
- Address proof for pickup location
- Brand Registry (for brand protection - requires trademark)
Flipkart Seller Registration
- GST Registration
- PAN and bank account
- Cancelled cheque or bank statement
- Address proof
- Product catalog
Meesho Supplier Registration
- GST Registration
- PAN
- Bank account details
- Address proof
- Product images and descriptions
Your Own D2C Website
- Company Registration (for payment gateway)
- GST Registration
- Payment Gateway Integration (Razorpay, PayU, Cashfree)
- Terms and Conditions, Privacy Policy, Return Policy
- Consumer Grievance Officer details
Tax Implications for E-Commerce Sellers
GST for E-Commerce
- •TCS (Tax Collected at Source): Marketplaces collect 1% TCS on net sales
- •Input Tax Credit: Claim GST paid on purchases against GST on sales
- •Regular Returns: Monthly GSTR-1 and GSTR-3B filings mandatory
- •Annual Return: GSTR-9 by December 31
Income Tax
- •Corporate tax rate: 25% under Section 115BAA
- •Advance tax must be paid quarterly if annual tax liability exceeds Rs 10,000
- •Maintain proper books of accounts
TDS Compliance
If making payments to suppliers above specified limits:
- •Professional services: 10% TDS
- •Contractor payments: 1-2% TDS
- •Rent: 10% TDS
Common Mistakes E-Commerce Entrepreneurs Make
- Starting without GST - All e-commerce sellers need GST from Day 1
- Using personal bank account - Always use a company current account
- Not keeping inventory records - Essential for GST reconciliation
- Ignoring TCS reconciliation - Match TCS deducted by marketplace with your records
- Not registering trademark - Someone else might register your brand name
- Mixing personal and business expenses - Maintain clean books from Day 1
E-Commerce Business Registration Cost Summary
| Component | Cost |
|---|---|
| Company Registration (Growth Plan) | Rs 3,999 |
| GST Registration | Included in Enterprise Plan |
| FSSAI Basic Registration | Rs 100/year |
| Trademark Registration | Rs 4,500-9,000 |
| Import Export Code | Free |
| Total (Without Trademark) | Rs 4,000-5,000 |
| Total (With Trademark) | Rs 8,500-14,000 |
Conclusion
Setting up an e-commerce business in India requires proper registration, GST compliance, and platform-specific documentation. With Setup India's Growth Plan at Rs 3,999 (including GST guidance), you can get your e-commerce business legally registered and marketplace-ready in just 7 days.
Register your e-commerce company now and start selling on Amazon, Flipkart, and beyond.