Blogs

Blogs

Blogs

Articals that are worth reading

MCA Notification on CS Appointment and Secretarial Audit

13 Jan,2020

MCA vide notification dated Jan 3, 2020 has made following amendment to Companies(Appointment and Remuneration of Managerial Personnel) Rules,2014 as to requirement of appointment of whole-time company Secretary and Secretarial Audit effective from April 1st2020. As per the amended provisions,  ln case of private companies paid-up capital limit has been increased from five crores to 10 crores, for mandatory appointment of company Secretary. Secondly, the secretarial audit has been made applicable to every company having a loan or borrowing from the bank or financial institutions of Rs 100 crores or more.

Appointment of whole-time company secretary:

Current provision

Provision with effect from April 1st 2020

  1. Every listed company and public companies having a paid-up capital of ten crores or more are required to have a whole-time company secretary

                         or

  1. A Company other than the company mentioned in (i) above having a paid-up share capital of five crore or more are required to have a whole time company secretary.

  1. Every listed company and public companies having a paid-up capital of ten crores or more are required to have a whole-time company secretary

                             or

  1. Every Private Company having a paid up share capital of ten crore or more are required to have a whole time company secretary.

Requirement of Secretarial Audit Report:

Current provision

Provision with effect from April 1st 2020

  1. Every Public company having a paid up share capital of fifty crore rupee or more

 

Or

 
  1. Every Public company having a turnover of two hundred fifty crore rupees or more

  1. Every Public company having a paid up share capital of fifty crore rupee or more

 

Or

 
  1. Every Public company having a turnover of two hundred fifty crore rupees or more

                           Or

 
  1. Every Company having outstanding loans or borrowings from banks or public financial institutions of one hundred crore rupees or more.

 

Explanation:

For the purpose of this sub-rule, it is clarified that the paid up-share capital, turnover, or outstanding loans or borrowings as the case may be, existing on the last date of the latest audited financial statement shall be taken into account.

startup eligibility and tax exemptions

Startup India: Eligibility & Tax Exemptions

30 Dec,2019

Eligibility for Startup India

As per the Startup India Action plan, the followings conditions must be fulfilled in order to be eligible as a Startup :

  • Being incorporated or registered in India for less than 7 years and for biotechnology startups up to 10 years from its date of incorporation.

  • Annual turnover not exceeding Rs 25 crores in any of the preceding financial years.

  • Aims to work towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property.

  • It is not formed by splitting up or reconstruction of a business already in existence.

  • It must obtain certification from the Inter-Ministerial Board set up for such a purpose.

  • It can be incorporated as a private limited company, registered partnership firm or a limited liability partnership.

Following tax exemptions have been allowed to eligible startups :

1. 3 year tax holiday in a block of seven years

The Startup incorporated after April 1, 2016, is eligible for getting 100% tax rebate on profit for a period of three years in a block of seven years provided that annual turnover does not exceed Rs 25 crores in any financial year.This will help the startups to meet their working capital requirements during their initial years of operation.

2. Exemption from tax on Long-term capital gains:

A new section 54 EE has been inserted in the Income Tax Act for the eligible startups to exempt their tax on a long-term capital gain if such a long-term capital gain or a part thereof is invested in a fund notified by Central Government within a period of six months from the date of transfer of the asset. The maximum amount that can be invested in the long-term specified asset is Rs 50 lakh. Such amount shall be remain invested in the specified fund for a period of 3 years.If withdrawn before 3 years, then the exemption will be revoked in the year in which money is withdrawn.

3. Tax exemption on investments above the fair market value

The government has exempted the tax being levied on investments above the fair market value in eligible startups. Such investments include investments made by resident angel investors, family or funds which are not registered as venture capital funds. Also, the investments made by incubators above fair market value is exempt.

4. Tax exemption to Individual/HUF on investment of long-term capital gain in equity shares of Eligible Startups u/s 54GB.

The existing provisions u/s 54GB allows the exemption from tax on long-term capital gains on the sale of a residential property if such gains are invested in the small or medium enterprises as defined under the Micro, Small and Medium Enterprises Act, 2006. But now this section has been amended to include exemption on capital gains invested in eligible start-ups also.

Thus, if an individual or HUF sells a residential property and invests the capital gains to subscribe the 50% or more equity shares of the eligible startups, then tax on long term capital will be exempt provided that such shares are not sold or transferred within 5 years from the date of its acquisition. The startups shall also use the amount invested to purchase assets and should not transfer the asset purchased within 5 years from the date of its purchase.

This exemption will boost the investment in eligible startups and will promote their growth and expansion.

5. Set off of carry forward losses and capital gains allowed in case of a change in Shareholding pattern.

The carryforward of losses in respect of eligible start-ups is allowed if all the shareholders of such company who held shares carrying voting power on the last day of the year in which the loss was incurred continue to hold shares on the last day of the previous year in which such loss is to be carried forward. The restriction of holding of 51 percent of voting rights to be remaining unchanged u/s 79 has been relaxed in case of eligible startups.

Do you have any questions about tax or finance you need help with?

Get in touch with the best chartered accountants firm in bangalore. We will provide you with the end to end solutions to all your GSTtax ,accounting,CFO needs in Bangalore.

GST

A nation wide consultation to be held on new return forms on December 7 by GST Authority!

22 Nov,2019

Finance Minister Nirmala Sitharaman on Saturday directed the Goods & Services Tax (GST) organization to hold a special filing demonstration session for new return framework. This activity is expected to get the input before the new documenting system becomes effective from April 1, 2020.

As per the law it is mandatory to file return either on monthly or quarterly basis, based on their turnover.

The Finance Minister met tax assesses in five group to discuss and find ways to further simplify GST forms and make the existing filling process (GSTR 1, GSTR 3B, GSTR 9, GSTR 9c etc) more user friendly. Five bodies demonstrated in real time before the Finance Minister and Senior GST and GSTN officials, the various issues encountered during filling GST forms.

However, there are issues related to certain entries where some amendments have been made, issue of credit note or debit note, matching of input tax credit (ITC) for buyer filing monthly return and seller filing quarterly return and demand to produce physical invoice by tax officials even details mentioned in GST Return Form 2A. There was also a suggestion to further ease co-relation of various forms.

The activities would assist organizations with getting ITC benefits with no problems.

70.22 per cent of the assessees, having an annual turnover of less than ?5 crore and engaged in B2C (business to consumer), B2B (business to business) as well as reverse charge mechanism-based supply activities can opt for quarterly filing of return. This form is called ‘SUGAM’ (RET-3). This is according to the turnover-wise distribution based on GSTR 3B (existing return form) filed during 2018-19.

About 28 per cent of the assessees, with an annual turnover of less than ?5 crore and are engaged in B2C as well as reverse charge-based supply activities. They can opt for ‘SAHAJ’ form (RET-2). All other assessees (engaged in foreign trade or SEZ-based activities) will have to file RET-1. They will be required to file the returns on a quarterly basis but payment of tax dues on monthly basis through a form called PMT-08.

Over 7 per cent assessees with annual turnover of more than ?5 crore. They will have to file the return on a monthly basis through RET-1. These assessees are a small in number, but in terms of overall tax payment they contribute nearly 85 per cent. Under the new system, these assessees will have to file their returns by the 20th of the next month, which means a majority of the collection will be with the Government by that date. For other assessees, the filing date is the 25th of next month.

Under the present framework, one can display two unique figures in GSTR 1 (showing liability) and GSTR 3 B (showing tax payment) as they are not linked automatically. Thus, one could show higher liability,claim higher input tax credit and pay less tax. In any case, this will be not be possible under new system.Through the RET-1/2/3, the taxpayer pays the auto-populated risk (from ANX-1) by using money and ITC (auto-populated through ANX-2) both. Additionally, only the creator of the form will be able to amend the details.


Get in touch with the best chartered accountants firm in bangalore. We will provide you with the end to end solutions to all your GSTtax ,accounting,CFO needs in Bangalore.

Have Any Question? We Can Help You..

Call Us +91 80-2572 4815