startup registrations

Top 5 Reasons Why You Should Register Your Company

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How can one own a business which does not legally exist, that’s where this article will help you as it answers the most vital question: Why you should register your Company. In the initial stage entrepreneurs focus on the development of their unique product/ service that they intend to offer, but market research has proven that registering the Company is a necessity and not an option as it is the determining factor in the success of any business. It is advisable to register your Company keeping in mind the following factors: 

  • Establish a presence:

In a competitive market like India, establishing a Company’s presence can be a big challenge. Due to an increased number of startup registrations, it is very important to register your Company. Company registration gives a unique identity to the business. Once a new company registration is done no other company can be registered with the same name all over India, hence it gives establishes a presence and gives a unique identity to the business. New company registration also adds to the credibility of the Company.

  • Banking operations:

To operate any business irrespective of its scale of operations one requires a current account to separate personal and business finances. To open the bank account registration documents, certificates, etc. need to be attached with the application which are further cross verified by the bank. Similarly for getting loans the banks have a lengthy documentation procedure which can only be fulfilled if the company is registered and compliant. For a registered Company there is an increased access to funding sources as it is highly preferred by investors.

Also Read this blog: What is a Sec 8 company under Companies Act, 2013 with basic key points

  •  Limited Liability:

The biggest reason why people opt for company incorporation is limited liability. As the company is treated as a separate legal entity, the Company protects its owners from personal liability. This means that if the company is sued, or incurs penalties, debt its members are not liable to satisfy the claims with their personal assets. The owners/ shareholders/ promoters are only liable upto the amount invested in the company, therefore the company provides limited liability as it has a separate identity.

Now Register Your Company In Dubai

  • Makes you look serious and contract ready:

Once you enter the market with a registered business it adds to the brand building of the new company registration. It also increases the chances of getting contract as the documentation and registration is complete, and enables discounts in case of suppliers, as everyone prefers to do business with a registered Company. Even for applying for tenders one needs to have a registered entity whether its government tenders or commercial tenders.

Read Other blogs: REGISTRATION REQUIREMENTS OF OPENING A BRANCH OFFICE IN INDIA

  • Perpetual Succession:

Any change in the ownership of the Company does not affect the status of the Company. The Company goes on irrespective of its owners/ promoters/ shareholders. Even death, insolvency, insanity of any member of the Company does not affect its continuity. New Company registration is an asset for the owners, it can be passed down, sold, transferred for running the business.

Company registration is a big step and brings with it a lot of compliances, and filing obligations but at the same time it offers huge benefits which are incomparable.

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chartered accountant

IMPORTANCE OF CONSULTING CHARTERED ACCOUNTANTS/COMPANY SECRETARIES FOR TAX MANAGEMENT

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Institute of chartered accountants of India (ICAI) is authorized to certify the professional chartered accountants (CA) having requisite knowledge about all the aspects of finance, accounting and IT. Whereas Institute of company secretary (ICSI) is authorized to certify company secretary in India having appropriate knowledge of business/corporate law etc. which will help in smooth functioning of the business.  Both these professional qualifications have a different genre of specialization which cannot be supplemented by the other.

Being a Chartered Accountant (CA) is nothing less than a doctor. Like doctor is the specialist of a living being in the same way a Chartered Accountant (CA) is a financial specialist. Like a sick person has to visit a doctor for check-up or advice, it is a financial one should visit if he is facing any issue in his business, need some advice regarding their investments, filing of ITR, GST etc.

Get a CA at affordable price

Since we all know that India is an emerging economy and we are aspiring to become $5 billion economy by 2024, giving a boost to “Make in India” all these dreams would be fulfilled only with the help of the Chartered accountant/company secretary. There are various services that a tax consultant (chartered accountant/company secretary) provides to their clients which helps them in managing their tax related issues.

  • Investment Advise
  • Financial advisory
  • Management consulting service
  • Due diligence service
  • Forensic audit
  • Project financing
  • Compliance laws
  • Timely filing of ITR, GST etc.
  • BookKeeping
  • Auditing etc.
  • Authorized signatory

A chartered accountant plays an important role in bringing sustainable growth in the organisation and most effective & efficient use of resource, with minimal waste and maximum productivity. We can say that CA/CS & business firms are like inseparable twins which cannot exist without each other. For example: A business firm cannot work efficiently without the consultation of CA/CS and vice-versa.

Consulting a chartered accountant is very essential for your business because of many reasons-

  1. Financial viability: ability to generate sufficient funds so as to meet the requirements of the project; be it long term or short term, capital intensive or working capital requirement.
  • Business valuation: Most appropriate valuation of a business can only be done by an expert who is qualified and well trained. Talking about the business environment in India a CA is the right candidate for this work.
  • Project analysis: Before starting a new project, a complete market and competitor’s analysis must be carefully done before making that project a reality; therefore a CA is the right choice for project analysis part.
  • Capital structuring: There must be a balance between the equity and debt components of an organization which is decided by a CA depending on the type of business.
  • Legal representation: A CA could possibly be a legal representative of you in any court in income tax/GST or tax related matter where he has authorized your returns.

To know more read: POPULAR CHARTERED ACCOUNTANTS (CA) SERVICE PLATFORMS IN INDIA

Consulting a company secretary is very essential for your business because of many reasons-

  1. Link between management & other stakeholders: since management and other stakeholders are not directly in touch with each other that’s when a company secretary comes into picture and works to bridge the gap between the two important parties.
  • Compliance norms: It is the duty of company secretary to look into compliance related norms before taking in any decision for the organization.

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Company incorporation

What is a Sec 8 company under Companies Act, 2013 with basic key points

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COMPANIES ACT, 2013

Sections (8) of companies act, 2013 deals with the formulation of companies with charitable objects such as promotion of art, science, commerce, sports, education, research, welfare, without adding the words “limited” or “private limited” to the name of the new company registered.

1. The satisfaction of central government is necessary, that a person proposed to be registered as limited liability Company (LLC) under this act.

  • Includes the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment etc.
  • The profits or income of new company registered will be used for promoting objects of company.
  • The Central Government may issue license on such condition as it deems fit; allow it to be registered as a limited company.

2. Company incorporation shall enjoy the privileges and are subject to all the obligations of limited companies.

3. A firm can become a member of the new company registered.

(i) Once the new company registered under this act; are not liable to alter the memorandum or articles without prior permission of central government.

(ii) Conversion into some other form of company incorporation is only possible after complying with such conditions as prescribed from time to time.

4. Revocation of licence: Central government may revoke the licence if the company contradicts with any of the requirements mentioned under this section or in a manner violative of objectives of the company or prejudicial to the public interest, direct the new company registered to convert its status & change its name.

5. Subsequently, when the licence is revoked and the Central Government is satisfied that it is essential in the public interest that the new company registered should be amalgamated/wound up with another company incorporation under this, then the Central Government may provide for such amalgamation to form a single company with such features as prescribed by the government in the order.

{Note: Reasonable opportunity of being heard must be given}

6. Winding up/Dissolution of a company registered under section (8) companies act, can be transferred to another company registered under this section subject to certain conditions as the Tribunal may impose, or maybe sold and proceeds will be credited to the Rehabilitation and Insolvency Fund formed under section 269.

7. Amalgamation between companies could be done only if both are registered under the same section of the act, having similar objects.

8. Any default in complying with the requirements specified under this section, be punishable with a fine which shall not be less than 10 lakh rupees extending up to 1 crore rupees and the directors/officers of the company who found guilty shall be punishable with imprisonment for a term which may extend to 3 years or fine not be less than INR 25,000 extending to INR 25 lakh or both.

Read Other blogs: REGISTRATION REQUIREMENTS OF OPENING A BRANCH OFFICE IN INDIA

KEY HIGHLIGHTS OF COMPANIES ACT, 2013

Several new features were introduced in the Companies act, 2013 which makes it unique from the companies act, 1956. Some features are discussed below:

1. COMPANIES

(i) One Person Company incorporation: Companies act, 2013 brings relief for the new generation entrepreneurs who are not willing to share the stake in their company with anyone. Now an individual can form a single person company which was not possible earlier. Now the foreign investor can also set up wholly-owned private subsidiary in India. Hence it will promote foreign investment in India.

(ii) Small Company incorporation: Companies other than the public company having a paid-up share capital of not more than 50 lakh & turnover does not exceed 2 crores.

{Note: This will not apply to holding/subsidiary, companies registered under section (8) of companies act, 2013 or any company formed under special act}

(iii) Dormant Company incorporation: Earlier dormant company was tagged with a sign of caution, but this situation has done away with in company act, 2013. Now a dormant company can be formed for holding assets or intellectual property subject to the company not having any significant transactions.

(iv) Associate Company incorporation: A company having “significant influence” on the other without being a subsidiary/holding company. Here the term “significant influence” can be termed as a company having a stake of at least 20% or more.

(v) Private Company incorporation: Total number of shareholders in a private company has been increased from 50 to 200.

2. OBJECT CLAUSE

Previous companies act, 1956 requires the object clause to be classified into 3 categories viz. The main object, Ancillary object & other objects; reason for such condition was to restrict the company from commencing any other business. However, such a requirement has been done away with by coming of companies act, 2013.

Know about Section 8 Company Registration

3. PROMOTER

“Promoter was nowhere mentioned in the previous companies act. However, it was extensively used under the Companies act, 2013. A promoter is a person who is named such under any annual return.

4. BUY-BACK SECURITIES

Under the new companies act, there is no buyback of securities within one year from date of closure of the previous buyback. This period is termed as “cooling off period”. Further, if a company is a defaulter (loan), then the company incorporation shall compulsorily have to wait for 3 years after repaying the entire outstanding amount.

HOW TO REGISTER PRIVATE LIMITED COMPANY IN 4 EASY STEPS

HOW TO REGISTER PRIVATE LIMITED COMPANY IN 4 EASY STEPS:

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Private Limited Company registration is the most popular business entity among businessmen in India, it suits all kinds of industries whether small, medium, or large businesses. According to the data reports on the Ministry of Corporate Affairs website around 10,000+ companies are incorporated every month. A private limited Company as the name suggests is a closely held Company which limits the shareholder’s liability to the extent of the contribution made by them, providing the owners:

  • A Legal Entity
  • Perpetual succession
  • Limited risk
  • Dynamic

GSt Registration

Seeing the popularity of Private Limited Company Registration we have summed the whole process in four simple steps:

  • STEP 1: DIGITAL SIGNATURE CERTIFICATE (DSC)

The first and foremost step is to obtain the digital signature certificates for the proposed directors and subscribers. DSC’s are required for filing e-forms on the MCA portal. There are government specified certifying authorities who can issue DSC’s. DSC’s are tokens with a validity of 1-3 years. The promoters/directors/subscribers need to get their mobile, email and video verification done to procure their Digital signature Certificates. The application and verification process takes around two working days.

  • STEP 2: NAME APPROVAL

The second step being name approval, the proposed name of the Company needs to be filed using the RUN form. The reserve unique name facility is provided by the Ministry of Corporate Affairs under the ease of doing business initiative. It’s a web form which is available for new and existing Companies. The form requires two names in the order of preference along with a brief regarding the business of the Company.  Name Approval is done within 24 hours and the name so approved is reserved for 20 days, once the period has lapsed a fresh application is required.

  • STEP 3: COMPANY INCORPORATION CERTIFICATE

Once the name of the Company is approved, the application for the incorporation certificate needs to be filed. The Ministry of Corporate Affairs has provided a comprehensive form i.e. SPICE, Simplified Proforma for Incorporating a Company Electronically, through which one can apply for allotment of DIN, name reservation, incorporation certificate, PAN and TAN application in the same form. The SPICE form needs to be submitted along with the SPICE-form MOA (Memorandum of Association) and SPICE-form AOA (Article of Association) by paying the requisite fee and the stamp duty of the concerned state.

  • STEP 4: COMMENCEMENT OF BUSINESS

Every Company having a share capital incorporated after 2nd November, 2018, needs to file a declaration needs to be filed in form 20A to be issued by the directors within 180 days of Company Incorporation in India stating that the subscribers to the Memorandum of the Company have paid the value of the shares with a proof of subscription money received. The company can start operations only once the commencement of the business form has been filed.

FSSAI Registration

FAQ:

-How much does it cost to register a company in India?

With the ease of doing business initiative by the government of India, the cost of Company registration has marginally been reduced. Once can expect the charges around 3000-6000 per registration, which may differ from state to state.

-How long does it take to register a company in India?

The whole Company registration process is online, it generally takes around 5-7 working days to incorporate the Company as there are a few verifications and validations required by the client.

-What documents are required to register a company in India?

Documents required for proposed Director:

1) ID Proof ( PAN Card)

2) Address Proof 1 Adhaar/Voter ID/Passport/Driving License (Any one)

3) Address Proof 2 Electricity Bill/Telephone Bill/Bank Statement(Any one)

4) Photograph

Documents for proposed office address of the Company:

1) Electricity Bill (latest)

2) Rent Agreement of premises

3) No Objection Certificate

-Can I start a business without registering it in India?

It is not advisable to start a business without any registration. In India there are various kinds of business structures varying from simplest form to the complex ones. You can refer to our blog –How to choose the right business structure for your business? and choose one according to your needs.

-How can I start a Pvt Ltd Company in India?

To register a private limited Company in India one needs to follow the above mentioned procedure or take the help of ca services. For detailed information visit our knowledge corner by clicking on the below mentioned link: https://blog.caonweb.com/ (Search & find related topic).

Related Blog – INCOME TAX EXEMPTIONS/DEDUCTIONS

FOREIGN DIRECT INVESTMENT (FDI): A key driver of India’s economic growth

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FDI is an investment from a party in one country into the business/corporations of another country with the intention of having a “lasting interest”. Here the “lasting interest” is determined when the investing party acquires a share of at least 10% voting right in other organisation. Therefore, the element of control is the key differentiator between FDI & Foreign portfolio investment (FPI).

FDI in India is not just restricted to the movement of capital across borders but it also includes movement of other elements such as skills, technology, process, management

Since the liberalisation of the Indian economy in 1991, the climate of Investment has improved exponentially. This is more or else because of ease in FDI reforms across sectors.

To attract a huge chunk of investors from outside, Government of India (GOI) has made policy of FDI in India in such a way that it is more transparent & easy to understand for any investors.

There are two ways of FDI in India.

  • Automatic Route: Does not require any approval from GOI.
  • Government Route: Prior approval from GOI is mandatory.

For a mixed economy like that of India where we have both public and private sectors, it’s need of the hour that we should bring in as much FDI in India as possible since it will open new doors for the Indian economy and help in achieving the dream of becoming $5b economy by 2024.

FDI is the major driver for economic growth of India. Some of the factors which helps in attracting FDI in India are: Abundance of natural resource, market size, infrastructure, geographical location, government policies

Alternatively, FDI can be brownfield – wherein an organisation expands by way of cross-border mergers, acquisitions and joint ventures – by either leasing or purchasing existing facilities for its production. The clear advantage of brownfield investments is the savings in cost and time for starting up, as well as engaging in construction activities.

Read other blog: APPROVAL PROCESS FOR FDI IN INDIA

BENEFITS OF FDI IN INDIA

  • Employment and Economic Growth

Creation of jobs is the most obvious advantage of FDI in India. It is also one of the most important reasons why a nation, especially a developing one, looks to attract FDI. Increased FDI boosts the manufacturing as well as the services sector. This in turn creates jobs, and helps reduce unemployment among the educated youth – as well as skilled and unskilled labour – in the country.

  • Human Resource Development

This is one of the less obvious advantages of FDI. Hence, it is often understated. Human Capital refers to the knowledge and competence of the workforce. Skills gained and enhanced through training and experience boost the education and human capital quotient of the country. Once developed, human capital is mobile.

  • Development of Backward Areas

This is one of the most crucial benefits of FDI for a developing country. With the dawn of FDI in India, backward areas were transformed into industrial regions. This in turn provides a boost to the social economy of the area.

  • Technological development

Most updates technology, international operations practices are also brought in by bringing in FDI. Over time, the introduction of newer, enhanced technologies and processes results in their diffusion into the local economy, resulting in enhanced efficiency and effectiveness of the industry.

  • Increase in Exports

Since all the goods produced from FDI are not meant for domestic consumption rather many of these products are produced to be traded in global markets. The creation of 100% Export oriented Units (EOU) and Economic Zones have further assisted FDI investors in boosting their exports from other countries.

Read more: Top Reasons for Outsourcing Corporate Secretarial Services

  • Stable Exchange Rate

The constant flow of FDI into a country translates into a continuous flow of foreign exchange. RBI being central bank has certain responsibilities which it requires to fulfil; one of them is maintaining a substantial amount of foreign exchange reserves which acts as a buffer in case of any slump.

  • Stimulation of Economic Development

FDI is a source of external capital and higher revenues for a country. When factories are constructed, at least some local labour, materials and equipment are utilised. The people who are employed by such factories thus have more money to spend. This creates more jobs.
These factories will also create additional tax revenue for the Government that can be infused into creating and improving physical and financial infrastructure.

  • Improvement in Capital Flow

Capital inflow is beneficial for countries with limited domestic resources, as well as countries limited by opportunities to raise funds in global capital markets.

  • Competitive Market

FDI in India helps create a competitive environment by bringing in the foreign companies to setup here, break domestic monopolies. A healthy competitive environment pushes firms to continuously enhance their processes and product offerings, thereby fostering innovation. Consumers also gain access to a wider range of competitively priced products.  

Warehouse Registration

WAREHOUSE LICENSE & REGISTRATION

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According to warehouse development & regulatory authority (WDRA) act, 2007 further amended in 2017, specifies the rule and regulations that are mandatory for anyone who is carrying on warehousing business in India or planning to issue Negotiable warehouse receipts (NWR) must apply for warehouse license beforehand. Online registration procedure to get warehouse license has been put in place since November 01, 2017 and now every warehouse registration applicant has to submit online.

PROCESS OF WAREHOUSE LICENSE & REGISTRATION

  1. Filling of application form for warehouse registration
  • In accordance with WDRA act, 2007, any person desirous of getting warehouse registration must fill in the application form in accordance with the rule & guidelines mentioned.
  • Application can be submitted for one or more warehouse(s) owned by an individual or having effective control over it.
  • Primarily an application can be submitted electronically or the method as specified by the authority.
  • An application can be treated as complete only when it fulfills the mentioned criteria.
  • Application submitted in the manner as specified in sub-rule (1) of WDRA act, 2007
  • Contains all the documents as specified under WDRA act, 2007
  • Accompanied with the fees as specified under WDRA act, 2007
  1. Prescribed fees for warehouse registration: As specified under third schedule of WDRA act, 2007; prescribed fees must be paid to the authority within the stipulated time to complete your Warehouse license process.
  2. Acknowledgment receipt of warehouse registration: After warehouse registration application form received by the WDRA authority, documents verified and checked; authority must send an acknowledgment to the applicant within three (3) working days of receipt of application.

DOCUMENTS IN SUPPORT OF WAREHOUSE REGISTRATION APPLICATION

  1. Photograph (Passport size) of Authorized Representative.
  2. Applicant’s identity proof according to the Warehouse Registration Rules, 2017.
  3. Address proof of Authorized Representative.
  4. Standard Operating Procedures (SOP).
  5. Documents supporting the net-worth of the applicant.
  6. Insurance policy copy.
  7. Data Sheet (in case of cold storage).
  8. Technical standards proof of the warehouse site.
  9. List of equipment for preservation of goods
  10. List of equipment for weighing goods at the warehouse.
  11. Fire Safety arrangements at the warehouse.
  12. Copy of the Records of registered property title deed in respect land (in case property is owned)
  13. Document to demonstrate effective control over the Warehouse
  • Lease or rent agreement.
  • Sub-lease agreement & lease deed indicating that sub leasing is permitted.
  • Revenue sharing agreement (if applicable)
  • NOC from Municipal Corporation (any local authority as applicable)
  • Allotment letter copy from State Government.

Top Chartered Accountants in India

Top Chartered Accountants in India

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In today’s era, e-commerce is becoming very popular. We all are relying more on online service for purchasing of goods and services. Online Chartered Accountants services are also becoming popular as it is easy to access all services online rather than visiting CA’s office every time. Other benefits of Online CA services are:

  • Global reach as there are no geographical boundaries
  • Always opene. 24 hours a day, 7 days a week
  • The cost involved is less
  • Time and efforts involved are less
  • Ease of payment transactions
  • Paper wastage is less
  • Improved client services

Online CA services:

Now we can find all CA related services online like accountancy, auditing, taxation, etc. Chartered Accountants are providing following online CA services to their clients:

  • Accountancy or bookkeeping services: It includes writing up of accounts and preparation of financial statements.
  • Auditing services: It includes various audits like statutory audit under companies act 2013, tax audit under income tax act 1961, GST audit, internal audit, stock audit etc.
  • Taxation services: It includes preparing and filing of returns for tax purposes like Income tax returns, TDS returns and GST returns. It also includes representing the client before the tax authorities and rendering general advice on taxes to his clients.
  • Registration services: It includes company registration, GST registration, IEC registration, FSSAI registration, APEDA registration, ISO registration, MSME registration, etc.
  • Other Business related services: It includes other business-related services like company formation, company closure, company annual filing, LLP annual filing, business consultancy, financial advisory services, direct and indirect taxation advisory services, management consultancy services, foreign remittance compliance, etc.

Read other blog: Are you looking for a Chartered Accountant online in India?

Top Chartered Accountants in India:

Understanding and compliance of applicable tax laws can be very confusing and complicated for clients. There are various aspects related to bookkeeping, taxation, laws, and regulations, which can be difficult for the client to understand. That’s why it is very important to hire professionals for this work so that clients can focus on their main business activities rather than worrying about tax compliance.

Tax Consultants in India:

Tax Consultants ensures that clients comply with all tax obligations and receive all deductions for which he is eligible for. There are many small tax consultants in India but it is always better to prefer a Chartered Accountant as they have all the required knowledge and experience for compliance of applicable tax laws. Chartered accountants are professionals who use their knowledge and expertise in helping individuals or businesses for making compliance of applicable tax laws.

Also Read: How to register a company online in Delhi?

For the access of online CA services, we have to search for companies or CA firms providing online CA services. If you are searching for top chartered accountants in India, then you can visit CA on web website for online CA services. We are providing an online directory where you can find top chartered accountants in India or tax consultant in India as per your requirements and you can also search for top chartered accountants in India nearby your location for your convenience.

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Income Tax Return filing

Confused about Income Tax Return filing? Find answers to all your questions

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If you are earning taxable income, then you should contribute some amount by way of taxes for the benefit of Nation. It is the responsibility of all taxpayers to declare Income and deposit tax their on for the benefit of economic growth of the country. Many people are confused about the Income Tax Return filing process, income tax return form applicable for them and documents required for it.

To help you, we are providing answers to all your common questions regarding income tax return filing:

  • Who is required to file an income tax return?

Online income tax return filing is mandatory for Individuals having annual income exceeding Rs2, 50, 000. There is a relaxation in this income limit for senior citizens i.e. Rs.3, 00,000 for senior citizens (more than 60 years old, but less than 80 years old) and Rs.5, 00,000 for super-senior citizens (more than 80 years old).

Related Blog – INCOME TAX EXEMPTIONS/DEDUCTIONS

  • What is the due date to file an income tax return form?

The due date for online income tax return filing not liable for a tax audit is July 31 of the assessment year. If you miss this deadline of ITR filing, and if you have a tax liability, then you have to file a belated return and pay your tax along with simple interest of 1 percent per month.

  • How to file an income tax return?

You can either file an income tax return form yourself by visiting the website of income tax department or take help of professionals through our online platform CAONWEB for filing and any queries relating ITR filing, income tax return form and, ITR due date.

  • What are the documents required to file an income tax return?

The documents required for ITR filing are PAN, Aadhar Card, Form 16 and 16A, Form 26AS, bank statements, interest statements, details of investments, insurance, and home loans. If you earn more than Rs.50 lakhs than you will also have to fill an additional column “AL” or assets and liabilities.

  • Which income tax return form to fill?

You have to select the applicable income tax return form for Online income tax return filing as per your income. Income Tax Department has provided seven forms ranging from ITR 1 to ITR 7 for ITR filing.

Read more:  New ITR filing date for A.Y 2019-20
  • Why you should file an income tax return even if your annual income is not taxable?

You should file an income tax return even if your annual income is not taxable as there are various benefits of ITR Filing like you can claim income tax refunds, apply for a loan, and carry forward capital losses.

  • Why there is tax due even after TDS was deducted?

There may be tax due even after TDS was deducted as your employer deducts TDS based on the tax slab you fall, which is based on your annual income. However, if you haven’t declared your investments or income from a previous employer, the calculations may go wrong. And, Banks also do not know your slab and they deduct TDS at 10%, which may lead to a tax due in your return if you belong to the 20% or 30% tax slab.

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  • Is it mandatory to report all your bank accounts?

Yes, it is mandatory to report all your savings and current bank accounts other than dormant accounts while online income tax return filing.

  • How do I verify income tax return?

Online income tax return filing process is incomplete and ITR is invalid unless your ITR V is verified. For verification of ITR-V, you can electronically verify or mail the signed ITR V to the processing center in Bengaluru within 120 days of filing the return.

  • What happens if you do not file an income tax return?

If you do not file an income tax return, then you will be liable for interest, late filing fees and penalties levied under the Income Tax Act.

Related Blog: 7 Ways Salaried Individuals Can Save Tax

REVERSE CHARGE MECHANISM

REVERSE CHARGE MECHANISM (RCM)

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GST being an indirect tax which is imposed on supply of goods & services is a comprehensive destination base tax. It is based on “One Nation One Tax” Approach which has subsumed almost every indirect taxes ate state/centre level.

Registration: A person who is required to pay tax under RCM has to mandatorily register under GST and the threshold limit of INR 40 lacs & INR 20 lacs is not applicable on this.

Read more blog: GST Department is getting stricter day by day!! Are you ready??

Input Tax Credit (ITC)?

  • When Goods purchased are for personal use: ITC cannot be claimed
  • When Goods purchased are for business use: ITC can be claimed
  • When Goods purchased are partly for personal & partly for business use: ITC can be claimed only on the portion used for supplies.
  • ITC not allowed for those supplies which are exempt from tax.

WHEN IS REVERSE CHARGE APPLICABLE?

According to section 3 of CGST act 2017, read in continuation with rule Rule46 of CGST rules, every invoice has to mention it on the top whether tax is in respect of supply on reverse charge.

: Maintenance of the accounts by a registered person.

: Reverse charge liability cannot be set off against the Input tax credit.

: Generally the supplier is liable to pay GST to the government almost in 90% of the cases, remaining 10% of the cases the liability is on the buyer to pay the GST. This creates a Reverse Charge where the liability shifts from supplier to the buyer. There are two (2) types of Reverse charge scenarios:

  • When an individual buys from an unregistered manufacturer.
  • When an individual buys from an e-commerce trader.
  • Supply of certain goods & services as specified by CBEC.

Time of supply?

It is the point at which the liability to pay GST arise. Factors relevant for time of supply depends on the person who is liable to pay tax. Therefore, the time of supply under reverse charge mechanism (RCM) is different from that of “forward charge”.

  1. Case of supply of goods

  • Date of receipt of goods; or
  • Date of debit as per bank account/Date of payment as per books of accounts (whichever is earlier); or
  • Date following the 30 days from date of issue of invoice. 
  1. Case of supply of services

  • Date of debit as per bank account/Date of payment as per books of accounts (whichever is earlier); or
  • Date following the 60 days from date of issue of invoice.

Read other blogs: 37th GST Council meeting: After restructuring Corporate tax structure now a big relief for GST Taxpayers

What is the concept of self-invoicing?

“Self-Invoicing” is a concept under Reverse charge mechanism (RCM) in which the onus of preparing the invoice lies with the receiver of goods or services falling under this category.

When you have purchased from an unregistered supplier then such transaction falls under reverse charge where the duty to pay tax lies with the receiver.

This is due to the fact that your supplier cannot issue GST invoice since his business is not registered. Hence, self-invoicing becomes necessary in this case.

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What is FSSAI?

WHAT IS FSSAI?

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FSSAI registration is based on the ONE NATION ONE FOOD LAW ideology which aims at providing globally benchmarked food standards and practices, ensuring consistency in enforcement of the rules and regulations so formed, and also manage food testing with standardized testing methods and products. FSSAI India has headquarters in New Delhi and 6 regional offices located in Delhi, Mumbai, Guwahati, Kolkata, Chennai, and Cochin.

As per Section 31(1) & 31(2) of Food Safety and Standards Act, 2006 every Food Business Operator in the country is required to be licensed/registered under the Food Safety and Standards Authority of India. FSSAI licensing, registration procedure and various other requirements are regulated by the Food Safety & Standards (Licensing and Registration of Food Business) Regulations, 2011.

GST Registration

An online portal has been created to ease out the process and make the procedure user friendly. Food Licensing and Registration System was been launched by Food Safety and Standards Authority of India to facilitate Food Business Operators (FBO) in India to apply for License/Registration Certificate and also be able to track their applications during the course of processing. FLRS is being used by 5 Regional offices and 2 Sub-Regional offices of FSSAI and several State Governments for processing and generation of licenses/registration certificates.

CATEGORIES OF FSSAI:

The process of application starts with identification of eligibility of your premise. Depending upon the installed capacity, turnover and location, your premise may be eligible for any of the following categories:

CENTRAL LICENSE:

  • Food Businesses with Annual Turnover more than 20 crores.
  • Operating business in two or more States.
  • Food business as listed in Schedule 1 of FSS (Licensing and Registration of Food Businesses) Regulations, 2011. 

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STATE LICENSE:

  • Food Businesses with Annual Turnover between 12 lakh and 20 crore.
  • All grain, cereal and pulses milling units irrespective of turnover.

FSSAI BASIC REGISTRATION:

Meant for small manufacturers, restaurants and petty retailers dealing in food products which includes food sale done by the temporary stall holder.

Company Registration

FSSAI RENEWAL:

It depends on the application made by the food business operator the FSSAI License is granted for a period of one to five years as requested. The fee for registration also varies according to the number of years for which the license is applied. FSSAI renewal can be done thirty days prior to the expiry date of the license.

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Q. What is the difference between FSSAI Registration & FSSAI License?

A. As we have discussed that according to the Food Safety and Standards Regulation, 2011, all food operators mandatorily require either FSSAI license or FSSAI Registration, if they are engaged in the manufacture, distribution, selling, transportation, and storage of the food products. Whether one needs to go for FSSAI registration or license solely depends on the size and nature of the FBO.

Accounting & Auditing

Q. What are the consequences of not obtaining FSSAI?

A.  All the registered persons have to abide by the FSSAI rules and regulations. The Food Safety Officer has the authority to conduct the inspection of the facility provided by the food business operator and identify the level of compliance, if any. He marks the FBO based on the compliance level:

  1. Compliance (C)
  2. Non-compliance (NC)
  3. Partial Compliance (PC)
  4. Non-applicable/ not observed (NA)

In case the food safety officer issues an improvement notice to the FBO and they fail to comply with it, the officer may cancel their registration. The decision of the officer can be challenged through appealing in the Food Safety Appellate Tribunal/ High Court.

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