A proprietorship can be closed for two main reasons - the wish of the proprietor or the death of the proprietor. If closing due to the proprietor's wish, there is generally no legal process required but any licenses held must be surrendered according to state laws. It is also advisable to clear all debts before closing to avoid future litigation. When closing a bank account associated with the proprietorship, any credit taken from the bank such as overdrafts must also be paid off.

1. Closing Down a Proprietorship
Shantanu
4th Yr.
NLU, Odisha

2. Proprietorship
• Also known as sole proprietorship.
• Only one owner.
• Simplest form of business organization.
• Proprietorship is not a separate legal entity.

3. Opening of a Proprietorship (contd…)
• A sole proprietorship can be started without
taking any burdens of the legal provisions.
• Registration not necessary.
• Depending upon the rules of the local
administration, you may be required to obtain
requisite licences.

4. Opening of a Proprietorhsip
• Search the state laws to find out the kinds of
licenses you will need to carry on the kind of
proprietorship you desire.
• Fill the forms cautiously.
• Deposit required fees.
• Whole process may take 30 to 40 days.

5. Closing of a Proprietorship (contd…)
• Two possible reasons for its closing:
(i) wish of proprietor; or
(ii) death of proprietor.
• In case of death of proprietor, the business
will automatically close and cannot be carried
forward.

6. Closing of a Proprietorship
• Generally, no need to go through legal
procedures.
• If the business has licenses, then you need to
surrender them.
• Surrender according to State laws.
• It is advisable to clear all debts before closing
of business to avoid future litigations.

7. Bank Accounts
• On the opening of a proprietorship, you
should have a bank account.
• While closing, you will need to close the
account.
• Any credit taken from the bank by way of
overdrawing or otherwise should also be set
off.

8. Thank You