Udyam Registration - Changes In Udyog Aadhar

As part of the Atmanirbhar Bharat initiative aimed at facilitating ease of doing business, the Ministry of MSME introduced a new definition for MSMEs along with a revamped registration process known as Udyam Registration. This new registration system came into effect on 01-07-2020.

Before this notification, MSME registration was known as Udyog Aadhar Registration. The newly launched Udyam Registration process brings several updates and is significantly different from the old system. It offers a more simplified, digital, and transparent mechanism for MSME registration.

Udyog Adhaar Vs Udyam Registration

Basis Of Changes	Udyog Aadhar Memorandum	Udyam Registration
Aadhar Number	Earlier, one Aadhar could be used to register multiple businesses.	Now, only one Udyam Registration can be made per Aadhar number. One enterprise per Aadhar.
PAN validation	PAN was not mandatory.	PAN and GSTIN are mandatory, and PAN details are automatically validated.
Number of employees	The total number of employees was mentioned without any breakdown.	Now, gender-wise details of employees (male/female/others) must be included.
Linkage with Income tax, PAN, and GST department	All information was filled in manually based on self-declaration.	Data is auto-fetched from the ITR (Income Tax Return) and GST filings of the previous year.
Composite criteria for the classification of MSMEs	Different criteria were used for the manufacturing and service sectors.	A single and unified criterion is used for both sectors - based on investment and turnover.
Registration Certificate	A Udyog Aadhar Memorandum (UAM) was issued instantly upon registration.	A Udyam Registration Number is generated first. The Udyam Registration Certificate is issued after verification.

Latest Changes in Udyog Aadhar – Udyam Registration

Udyam Registration Certificate with Dynamic QR Code:

The details of the enterprise can now be accessed through the Udyam Registration Certificate, which includes a dynamic QR code for quick verification.

Integration with Government Databases:

To ensure accuracy and transparency, the Udyam registration system is linked with Income Tax, GST, and PAN databases for automatic verification of information.

Unified Classification Criteria:

The earlier separate criteria for manufacturing and service sectors have now been combined. MSME classification is now based on both investment and annual turnover, applicable to all sectors.

Mandatory Re-registration for Existing Udyog Aadhar Holders:

All businesses registered under Udyog Aadhar must re-register under Udyam Registration by 31st March 2021 to remain valid

Mandatory PAN and GSTIN for New Registrations:

• For Companies, LLPs, Cooperative Societies, Trusts, and Societies, it is mandatory to provide PAN, GSTIN, and Aadhar at the time of registration.
• For Proprietorship firms, Aadhar-based self-declaration was allowed only up to 31st March 2021.
• From 1st April 2021, PAN and GSTIN validation is compulsory for all types of businesses.

Integration with Other Government Portals for MSMEs:

To promote ease of doing business, the following portals have been integrated with the Udyam Registration Portal:

• Government e-Marketplace GeM Portal
• Trade Receivables Discounting System (TReDS) Portal

New Definition Of Enterprises Re-classification Of The Existing Enterprise

• To be classified as a micro, small, or medium enterprise, a business must meet both the investment and turnover limits. If it crosses the limit of even one, it will move to the next higher category.
• A business cannot move to a lower category (like from small to micro) unless its investment and turnover both fall below the limits set for its current MSME category.
• If a business moves to a higher category (like from micro to small), it will keep its current status until one year after the registration year ends.
• If a business moves to a lower category (like from small to micro), the new status will apply from 1st April 2021. Until then, the business will remain in its current category until the end of the financial year.

Get Your Udyam Registration Done with Us – Apply Today!

The Government of India has started a new and easy process for businesses to register as MSMEs (Micro, Small, and Medium Enterprises). This helps new and small business owners enjoy various government benefits.

We are private consultants with experience in Udyog Aadhar and Udyam registration. Our team makes the process simple, fast, and hassle-free for you.

Just fill out the enquiry form on our website msmeregistrar.org and our experts will get in touch with you.

If you need help, just fill out the Udyam enquiry form, and one of our team members will call you through the Udyam helpline number.

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