Difference between Legal Name and Trade Name

One of the primary things you do as an entrepreneur is picking a business name. Your business can either work under your legal name or a trade name. Moreover, every GST return form contains a different column of both trade name and legal name that needs to be furnished. So, in this blog, we have listed out all the differences between legal name and trade name.

What is a Legal Name?

A legal name is the officially registered name of the person or entity. Typically, the legal name of a business is used on business paperwork, tax forms, and other government forms.

What is Trade Name?

A trade name is a name that is chosen by a person or entity to do business. Commonly, a trade name is also known as a doing business as (DBA), trading as (T/A), or operating as (O/A) name.

Difference between Legal Name and Trade Name

Legal name and trade name is one of the key element that plays an important role in the success of a business. Without a doubt, there are a ton of things that assume a part in how successful your business is.

Your business name is one of the main things potential clients notice about your organization. It helps in connecting with your clients and helps in interacting with goods or/and services provided by you. With an attractive legal name or trade name, your business is one bit nearer to being fruitful.

With regards to what you call your organization, you need to realize whether it’s more valuable to utilize your legal name or trade name.

You can use a trade name when you do not want to use your legal name as generally legal name ends with LLP, Pvt. Ltd., etc. Moreover, another major difference is that legal name is generally used in government whereas trade name is used in advertisements and signboard.

Let us understand the difference between legal and trade name this with an example

Urban company is a trade name and is commonly known by everyone. However, the legal name of this company is UrbanClap Technologies Pvt. Ltd.

How to Check Legal Name and Trade Name?

There are different ways through which one can verify the trade name and legal name of an entity

1. Anyone can check the legal name and trade name of an entity using an incorporation certificate issued by the Registrar of the company. And in the case of a partnership firm, a partnership certificate issued by the Registrar of firms.
2. Under GST, a taxpayer can check the trade name and legal name of an entity using GST REG-06

Advantages of using Different Trade Name and Legal Name

1. Enhanced business credibility
2. Attracts more customers
3. Differentiate the products
4. Business’s purpose clarity

Disadvantages of using Different Trade Name and Legal Name

As such, there is no major disadvantage of using a different trade name and legal name but we knit picked three:

1. Choosing an attractive trade name
2. Registering the name (obtaining trademark)

Conclusion

Through the above lines, we can infer that trade name and legal name are two unique things, and should not be used interchangeably. Moreover, a trade name helps you to attract customers and create brand awareness. So, it is essential to know the difference between legal name and trade name.