A sole proprietorship is one of the simplest and most common forms of business. In this structure, the business and the owner are treated as a single entity for tax purposes. If you're earning income through a sole proprietorship, here's how you can report it easily.

Steps to Add Sole Proprietorship Income

1. Go to File > Business & Profession > Add Business
2. Select the appropriate Nature of Business
3. Choose your Taxation Scheme:
   • Regular – Maintain books of accounts and declare actual income and expenses
   • Presumptive – Declare income on a presumptive basis under Sections 44AD, 44ADA, or 44AE
4. Enter your Business Details, including:
   • GST Registration (if applicable)
   • Business Name
5. Enter your Business Address and confirm the Nature of Business
6. Fill in the required Income Details, including gross receipts, expenses, and net profit

Steps to Add Assets & Liabilities

1. Click on the Assets & Liabilities tab
2. Enter your assets, including:
   • Fixed Assets (e.g., machinery, equipment)
   • Investments
   • Current Assets (e.g., cash, receivables)
   • Other Assets
3. Enter your liabilities, including:
   • Reserves
   • Non-current Liabilities (e.g., long-term loans)
   • Current Liabilities (e.g., payables)
4. Click Save once all details are entered

Once done, head over to the Summary tab to view your:

• Taxable Business Income
• Profit & Loss (P&L) Statement
• Balance Sheet

This gives you a complete snapshot of your sole proprietorship’s financials for the financial year.

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