At a glance
| Registration | Who needs it | Where |
|---|---|---|
| Shops and Establishments registration | Almost every shop or office with a fixed place of business | Your state's labour department portal |
| Trade licence | Many trades in cities and towns | Municipal corporation / municipality / panchayat |
| GST registration | Turnover above ₹40 lakh (goods) or ₹20 lakh (services) in most states; some sellers whatever their turnover | gst.gov.in |
| FSSAI registration or licence | Every food business (shop, café, bakery, sweets, grocery) | foscos.fssai.gov.in |
| Udyam (MSME) registration | Optional, free; useful for loans and schemes | udyamregistration.gov.in |
| Others, by trade | Pharmacy, weighing scales, signboards, larger premises | See below |
1. Before you sign the lease
- Permitted use: make sure the premises may be used for your kind of business: the city's zoning, the building's own rules (some residential complexes do not allow shops or clinics), and for food or heavy electrical loads, whether the building can support them.
- The owner's right to rent it out: see the property papers or the latest property-tax receipt in the owner's name.
- A written agreement: the rent agreement is your proof of address for most registrations below. Our free shop rent agreement generator makes a leave-and-licence agreement with the usual clauses (permitted use, lock-in, deposit, signboard, licences).
2. Shops and Establishments registration
Each state has its own Shops and Establishments Act. It covers working hours, holidays and employees' conditions, and requires shops, offices and other commercial establishments to register, usually soon after they open. You apply online on the state labour department's portal with ID proof, the address proof of the premises (rent agreement) and details of the business and any employees.
Some states exempt very small shops (for example, those with no employees) or only ask them to file an intimation. Fees and renewal rules differ by state.
3. Trade licence
Many municipal corporations require a trade licence for businesses run within city limits, especially for food, health-related, hazardous or noisy trades. You apply to the city's municipal body (online in most large cities) with the rent agreement, ID, and sometimes a no-objection letter from the owner. A signboard above a certain size may need separate permission from the same body.
4. GST registration
- When it is needed: when your aggregate yearly turnover crosses ₹40 lakh for goods or ₹20 lakh for services (or a mix) in most states. In some special-category states the limits are lower (₹20 lakh for goods, ₹10 lakh for services).
- Needed whatever the turnover: some sellers, for example those making taxable supplies to other states or selling through online marketplaces, unless an exemption applies to them.
- Where: online at gst.gov.in, with PAN, Aadhaar, a photo, bank details and the address proof of the shop (rent agreement plus the owner's consent letter or electricity bill).
- Rent itself: rent for commercial property can carry GST when the owner is GST-registered. Agree in the rent agreement whether the rent includes GST.
5. FSSAI registration or licence (food businesses)
Every food business, from a grocery or sweet shop to a café or cloud kitchen, needs FSSAI registration or a licence. The limits changed on 1 April 2026 (FSSAI order of 13 March 2026):
- Basic registration: yearly turnover up to ₹1.5 crore (it used to be ₹12 lakh).
- State licence: turnover above ₹1.5 crore and up to ₹50 crore.
- Central licence: above ₹50 crore, and for some kinds of business whatever the turnover.
Apply on foscos.fssai.gov.in, which also lists which kinds of business need which licence.
6. Udyam (MSME) registration
Optional and free, on udyamregistration.gov.in with Aadhaar and PAN. It registers your business as a micro, small or medium enterprise (a micro enterprise has investment up to ₹2.5 crore and turnover up to ₹10 crore since 1 April 2025), which helps with bank loans, government schemes and delayed-payment protection. Other websites that charge for it are not the official portal.
7. Others, depending on what you sell
- Pharmacy / chemist: a drug licence from the state drugs control department, with a registered pharmacist.
- Weighing scales: scales and measures used for selling must be verified and stamped under the Legal Metrology rules (state legal metrology department).
- Fire safety: larger shops, restaurants and premises in some buildings need a fire NOC from the state fire service.
- Professional tax: some states charge it on the business and on salaries paid; register with the state's commercial tax department where it applies.
- Electricity: a commercial connection (or a change of tariff) from the electricity distribution company, usually with the owner's consent.
Checklist of papers to keep ready
- PAN and Aadhaar of the owner(s) of the business; passport-size photos
- The signed rent agreement, and the owner's no-objection or consent letter
- A recent electricity bill or property-tax receipt of the premises
- Bank account details (a cancelled cheque) in the business's name
- Partnership deed or company documents, if it is not a sole proprietorship
Questions people ask
Which registration does every shop need?
Almost every shop or office with a fixed place of business registers under its state's Shops and Establishments Act, through the state labour department. Many cities also need a trade licence from the municipal corporation. The rest (GST, FSSAI, others) depends on your turnover and what you sell.
When do I need GST registration?
In most states, when your yearly turnover goes above ₹40 lakh for goods or ₹20 lakh for services. A few special-category states have lower limits (₹20 lakh for goods, ₹10 lakh for services). Selling to other states or through online marketplaces can require registration whatever your turnover. Apply on gst.gov.in.
Does a food shop need an FSSAI licence?
Yes, every food business needs FSSAI registration or a licence. Since 1 April 2026, basic registration covers businesses with a yearly turnover up to ₹1.5 crore; a State licence covers ₹1.5 crore to ₹50 crore, and a Central licence applies above ₹50 crore. Apply on foscos.fssai.gov.in.
Is Udyam (MSME) registration compulsory?
No, but it is free and makes a small business eligible for government schemes and priority-sector loans. Register only on udyamregistration.gov.in: other websites charge for something that is free.
Should I get the licences before signing the lease?
Check first that the premises may be used for your kind of business (zoning, the building's rules, and that the owner has the right to rent it out for commercial use). Most registrations need the rent agreement as proof of address, so you usually apply after signing it.
Sources
- FSSAI, order of 13 March 2026 on revised turnover thresholds, and the FoSCoS portal
- GST registration: GST portal (limits as raised by Notification No. 10/2019-Central Tax)
- Udyam registration: udyamregistration.gov.in (limits revised from 1 April 2025)
- Shops and Establishments registration and trade licences: your state labour department and municipal corporation