License required for Tour and Travel agencies for running their business

Travel and tourism industry, also known as Tour and Travel agencies is one of the major industries in India and plays a very significant role as employment generators. States like Goa and North-Eastern generate their primary revenue depending on tourism.

The licenses required to start a tour and travel agencies business in India are;

Business Entity Choices for Travel Agency

Any individual who is willing to open a Tour and Travel agency could open it under various selections of business entities, and these choices are left with the person who wants to start the business. Entrepreneurs generally select Private Limited companies as the preferred one amongst the rest, because Private Limited companies get a lot of benefits and subsidies from the government.

Also, business enterprises like Limited Liability Partnership (LLP) or One Person Company (OPC) could also be preferable for businesspersons who want to gradually build the business or carry it out on a part-time basis. As Limited Liability Partnerships have no obligation for audit unless the turnover goes beyond Rs.40 lakhs in a year, it shall be ideal for businesspersons who are getting their first-hand experience in their Tour and Travel agency venture. Then again, OPCs can also be ideal for businesspersons who are establishing their commerce as a single individual and want to avoid having broad compliance-related requirements to follow. However, a business enterprise offering limited liability status as well as separate legal entity status shall be perfect for a travel agent.

GST Registration for the Travel Business

It is important for business owners to adopt GST Registration so that they could collect GST from the customers on the service incurred through the business.

GST payable by Air Travel Agent is;

•    Commission income from the airlines for booking domestic air tickets, GST at the rate of 18% on 5% of Basic fare

•    Commission income from the airlines for booking international air tickets at the rate of 18% GST on 10% of basic fare

•    Processing/service fee for booking of tickets for the customer, GST at the rate of 18% on invoice from Air traveller

Trademark Required for the Travel Business

If the businessperson wishes to have a unique name and symbol, he could do so by means of registering as a trademark provided under the Intellectual Property Rights laws in India.

Becoming a Government of India approved Travel Agent

By registration as a Government of India approved Travel Agent is not compulsory; it is useful and provides recognition for the travel agent. The goal and objective of the scheme for recognition of Travel Agent or Agency (TA) is to boost the quality standard and service in the tourism industry. In order to become a Government of India recognized travel agent, the travel agent is required to satisfy few requirements on capital invested, number of employees employed, maintenance of minimum office space as well as other stipulations. Furthermore, application should be made towards the Ministry of tourism in the prescribed format in order to become a Government of India approved Travel Agent.

IATA Agent

The Travel agency is required to be approved by the International Air Transport Association (IATA). This travel Association offers several training methods and professional development services towards the travel agencies. IATA accreditation is very much preferred seal of approval recognized worldwide. It is important for a travel agency or for a travel agent availing international travel packages towards being a member of IATA, as it gives a lot of benefits in the air services across the globe.
 

Author:

eStartIndia Team