how to register a startup in india

"The society we live in is blessed with an abundance of creativity & entrepreneurial spirit."

Having said this, with each passing hour, we are marching towards an AI-first world and this is a great time for tech startups to make their mark. The Venture Capital Firms & Investors are having a close eye towards all the novel ideas that can be turned into reality. As the new motto says - "Dream Big, Act Now."

In this blog, we will be discussing how to do a startup in India.

A start-up is defined as a company or a project initiated by an entrepreneur to seek, develop, and validate a scalable business model. Entrepreneurship refers to all new businesses, including self-employment and businesses that never intend to become registered, whereas startups refer to the new businesses that intend to grow large beyond the solo founder. 

Startups & Small Business Statistics In India

Did you know that India is the 3rd largest startup ecosystem in the world? India is expected to witness year-over-year (YoY) growth of a consistent 12-15%. 

The Indian government defines a startup as an entity less than seven years young with an annual turnover of less than 250 million rupees and headquartered in India.

Our beloved PM Narendra Modi announced the Start-up India campaign in 2016 to promote and encourage entrepreneurship. This mainly revolves around financing, incorporation, tax exemptions etc, to ease the functioning of startups. With these benefits being provided by the Government, the majority of the start-ups have young owners, this shows the diversity and volumes of talents that India has.

how to register a startup company in india

Now that you have a better understanding about a startup, let us look into the Startup in India scheme.

According to the revised announcement on 23rd May 2017, an organization will be considered as a Startup, if it is incorporated in India as a private limited company (as defined in the Companies Act, 2013) or registered as a partnership corporation (registered under section 59 of the Partnership Act, 1932) or a limited liability partnership (under the Limited Liability Partnership Act, 2008).

An organization created by splitting up or reconstruction of existing commerce will not be considered a 'Startup'.

What Are The Eligibility Criteria For Startup Registration In India?

eligibility criteria for startup india

The following conditions must be fulfilled in order to be eligible as a Startup :

  • Being incorporated or registered in India for less than seven 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, a registered partnership firm, or a limited liability partnership.

Benefits Of Startup India Scheme

how to register your startup in india

The Indian Government has come up with various schemes to promote startups. The stated vision is to transform India from a nation of job seekers to job creators.  To fulfill this vision the GOI has launched the scheme viz Startup India registration under DIPP (Department of Industrial Policy and Promotion) under the Ministry of Commerce and Industry.  

This scheme supports Startups by providing various benefits to the registered entity. The benefits include financial as well as non-financial benefits. To register under this scheme the entity must fulfill the criteria specified.  

The benefits include :

  • Administrative and tax benefits. 

  • Capital gains exemption.

  • Government help for startup funding. 

  • Self- certification compliance framework with regard to labor and environmental laws. (startup's businesses would be excluded from any inspections of the place of business from up to 3-5 years.)

  • Qualified to incorporate 80% reduction patent registration fees and 50% reduction in the trademark filing. 

  • Benefited by free of cost legal help in conjunction with simplified entry and exit norms and protection of Intellectual Property Rights (IPR).

Read more →  Startup India Tax Exemptions

The Registration Process Of A Startup In India

startup india registration process

The startup can be registered as

  • Partnership Firm: To start a partnership firm, the parties have to draft a partnership deed where the terms and conditions of the partnership firm shall be mentioned. This partnership deed must be registered with the registrar of firms. We can assist you with partnership formation. Click below to know more https://adca.in/partnership-registration-bangalore.php

  • Limited Liability Partnership Firm: Limited Liability Partnership(LLP) as the name indicates, is a partnership firm with an additional feature of partner liability is limited. For income tax purposes LLPs and partnership firms are treated at par. The Ministry of Corporate Affairs is the registration authority for LLPs.  For more details on LLP registration, click here. https://adca.in/llp-registration-bangalore.php

  • Private Limited Company: Private Limited Company is the most preferred structure for businesses that plan to grow big, get investments by way of equity, wish to offer sharing of ownership with employees by way of ESOP, wish to get FDI, etc. The major advantage of Private Limited structure is the segregation of management from ownership. Directors form the management of the company, and Shareholders are the owners of the company.

The online registration process of a startup in India

  • Log on to Startup India Portal 

  • Enter the required details

  • Enter the Details of  Directors and Partners.

  • Upload the essential documents and Self-certification in the prescribed manner.

  • File the Incorporation/Registration certificate of the company.

Documents required for a startup registration in India: 

startup india registration documents

  • Memorandum of Association for Pvt. Ltd. / LLP Deed

  • Board Resolution (If Any)

  • Annual Accounts of the startup for the last three financial years

  • Income Tax Returns for the last three financial years

How to check your startup India registration status

Refer to your Dashboard on the Startup India Portal for the status of your application. This can be found on the top right of the page after you log in.

You can read more about startup registration here.


For any concerns related to the same, you can get in touch with us. Our team of experts will help you with the Startup Company Registration in Bangalore.

how to file itr with or without form 16

"Taxation is the price which civilized communities pay for the opportunity of remaining civilized."

- Albert Bushnell Hart

The above quote sums up a lot, doesn't it? 

In a nutshell, your financial wisdom is decided by the timely filing of your ITR. Filing your ITR is not as burdensome as it seems to be. In this blog, we will be discussing in detail about ITR, its benefits, the documents required, on how you can go about filing your ITR with form 16 and without form 16.

Income Tax Return -  What is it? 

what is income tax return

An Income tax return (ITR) is a form used to file information about your income and tax to the Income Tax Department. The tax liability is calculated based on your income. In case the return shows that excess tax has been paid during a year, then you will be eligible to receive an income tax refund from the Income Tax Department.

As per the income tax laws, the ITR must be filed every year by you or your business that earns any income during that financial year. The income could be in the form of a salary, business profits, income from house property or earned through dividends, capital gains, interests etc.Tax returns have to be filed before a specified date. If you fail to abide by the deadline, then there is a penalty levied. 

Now you might wonder if it is mandatory for you to file your Income Tax Return.

As per the Indian tax laws, it is compulsory to file your income tax returns if your income is more than the basic exemption limit. A delay in filing your ITR attracts not just a late fee but also hinders your chances of getting a loan or a visa.

Who is eligible to file Income Tax Returns?

According to the Income Tax Act, income tax has to be paid only by individuals or businesses who fall within certain income brackets. Mentioned below are entities or businesses that are required to compulsorily file their ITRs in India:

  • All individuals, up to the age of 59, whose total income for a financial year exceeds Rs 2.5 lakh. For senior citizens (aged 60-79), the limit increases to Rs. 3 lakh and for super senior citizens (aged 80 and above) the limit is Rs. 5 lakhs. 

  • All registered companies that generate income, regardless of whether they’ve made any profit or not through the year.

  • Those who wish to claim a refund on the excess tax deducted/income tax they’ve paid.

  • Individuals who have assets or financial interest entities that are located outside India.

  • Foreign companies that enjoy treaty benefits on transactions made in India.

  • NRIs who earn or accrue more than Rs. 2.5 lakh in India in a single financial year.

The documents required to file ITR

documents required for filing income tax return india

It is important to have all the relevant documents handy before you start your e-filing process.

  • Bank and post office savings account passbook, PPF account passbook

  • Salary slips

  • Aadhar Card

  • PAN card

  • Form-16-  TDS certificate issued to you by your employer to provide details of the salary paid to you and TDS deducted on it, if any Interest certificates from banks and post office

  • Form-16A, if TDS is deducted on payments other than salaries such as interest received from fixed deposits, recurring deposits etc. over the specified limits as per the current tax laws

  • Form-16B  from the buyer if you  have sold a property, showing the TDS deducted on the amount paid to you

  • Form-16C  from your tenant, for providing the details of TDS deducted on the rent received by you, if any

  • Form 26AS - your consolidated annual tax statement. It has all the information about the taxes deposited against your PAN

a) TDS deducted by your employer

b) TDS deducted by banks

c) TDS deducted by any other organisations from payments made to you

d) Advance taxes deposited by you

e) Self-assessment taxes paid by you

  • Tax saving investment proofs

  • Proofs to claim deductions under section 80D to 80U (health insurance premium for self and family, interest on education loan)

  • Home loan statement from bank

Why should you file your Income-tax return?

Why should you file your Income-tax return

Many people feel that filing tax returns is voluntary and therefore dismiss it as unnecessary and burdensome. 

Filing tax returns is an annual activity seen as a moral and social duty of every responsible citizen of the country. It is the basis for the government to determine the amount and means of expenditure of the citizens and provides a platform for the assessee to claim refund, among other forms of relief from time to time. Filing returns is a sign that you are responsible. Not just that, it also makes it easier for individuals and businesses to enter into subsequent transactions since their income is recorded by the tax department with applicable tax, if any, having been paid.

Even if your income level does not qualify for mandatory filing of returns, it may still be a good idea to voluntarily file returns. In most states, registration of immovable properties requires advancing as proof of the tax returns of the last three years. Filing returns makes it easier to register the transaction.

What are the Advantages of filing an Income tax return?

Advantages of filing an Income tax return

  • Prompt processing: The acknowledgment of Income Tax Return (ITR) is quick. More importantly, refunds, if any, are processed faster than paper-filed returns.

  • Better accuracy: E-filing software with built-in validations and electronic connectivity is seamless and minimizes errors considerably. 

  • Convenience: E-filing facility is available 24/7 and you can file anytime, anywhere.

  • Confidentiality: Your data is not accessible to anyone. 

  • Accessibility to past data 

  • Proof of receipt: You get a confirmation of filing, both at time of filing and subsequently, via email 

  • Ease of use 

  • Electronic banking: Convenience of direct deposit for a refund and direct debit for tax payments. You have the option to file now, pay later - decide what day to debit your bank account for tax payment.

How to file ITR online

How to file ITR online

The process to electronically file Income Tax Returns (ITR) by using the internet is called e-filing. The process is quick, easy. 

  1. Visit the e-filing website 

  2. Register or Login to e-file your returns

  3. Select the User Type : In order to register yourself with the Income Tax Department, you will have to first choose your ‘User Type’. The options available to you include Individual, Hindu Undivided Family (HUF), Other than Individual/HUF, External Agency, Chartered Accountants, Tax Dedcutor and Collector, and Third Party Software Utility Developer.

  4. Next, you will have to enter your current address and your permanent address before entering the Captcha code and hitting ‘Submit’.

  5. Basic details must be filled up

  6. Verification of PAN

  7. Activation of Account

In the end you will have to activate your Income Tax Department account through the link sent to your email ID

Have you not filed Your Income Tax Returns? Here’s What You Can Do

In case you do not file your income tax returns, you will have to submit a response on the e-filing portal. Here are the steps to do it:

  • Log in to the e-filing website.

  • Click on the ‘Compliance’ tab and you will get two options. ‘View and submit my compliance’ and ‘View my submission’. The first option will display the information for the assessment years when the return was not filed as per the records of the Income Tax Department or if the department needs third party details.

  • You can then select one of the options on-screen,  ‘the return has been filed’, or ‘the return has not been filed’.

  • If you select ‘the return has not been filed’, you will get the following options,  ‘return under preparation’, ‘no taxable income’, ‘business has been closed’, and ‘others’. 

  • Choose the relevant option and click on ‘Submit’.

Now let us understand what a Form 16 is :

form 16

Form 16 is an Income tax form used by the companies to provide their salaried individuals information on the tax deducted. It can be considered as your Salary TDS certificate.

Suppose the income from your salary for the financial year is more than the basic exemption limit of Rs. 2,50,000. Then your employer is required to deduct TDS on your salary and deposit it with the government. This can be a proof of filing their Income Tax Returns. And if your income does not fit the basic exemption limit, the employer does not deduct any TDS in that case.

In simple words, Form 16 is a certificate provided by your employer that certifies the details regarding the salary you have earned during the year and the TDS that has been deducted. It consists of two parts i.e. Part A and Part B, where part A consists of information of the employer & employee, like the PAN and TAN details, name and address, TDS deducted & deposited, etc. Part B consists of details pertaining to other income, deductions allowed, salary paid, tax payable etc. 

Form 16 is annually issued by the employer on or before 15th June of the next year, where it immediately follows the financial year in which tax is deducted. Also, in case you lose Form 16, your employer can issue a duplicate one.

You can download form 16 from the income tax site here.

The components of Form 16:

  • Refunds in any to the employee, or balance of taxes payable by the employee.

  • Details of the employer like collection Account Number (TAN), name, PAN, Tax deduction etc.

  • All details of the Tax Payment, like amount, Challan number, cheque number, Demand Draft number etc.

  • Personal details of the employee, like name, Permanent Account Number (PAN) etc.

  • Acknowledgement of number of the taxes paid by the employer.

  • Taxes deducted as per sections 191A.

  • Total income and tax deductions.

  • Details like salary, net salary, Gross salary, perks, deductions, etc.

  • TDS receipt paid.

  • Declaration of tax payments from the employer.

What is Form 16A or Part A of Form 16?

The employer generates and downloads this part of Form 16 through portal. Before issuing this certificate, the employer will authenticate for the correctness of its contents. It is vital for you to get a separate Part A of Form 16 for the period of employment if you have changed your job. Following are the components of Part A of Form 16:

  • PAN details of the employee

  • PAN & TAN of the employer

  • Employer Name and address

  • Summary of tax deposited and deducted quarterly, certified by the employer.

What is Form 16B or Part B of Form 16?

Form 16B is an annexure to Part A. In case you happen to change your job in one financial year, you will have to decide if you need Part B of the form from the last employer or from both the employers. Following are the components of part B of Form 16:

  • Relief under section 89

  • Detailed breakup of salary

  • Deductions that are allowed under the income tax act (under chapter VIA)

The details required for Form 16 while filing your Income Tax Return:

  • Tax Payable or Refund Due

  • Taxable Salary

  • Aggregate of Section 80C Deductions (Gross & Deductible Amount)

  • Breakup of Section 80C Deductions

  • TDS (Tax Deducted at Source)

  • PAN

  • TDS Deducted by Employer

  • Current Assessment Year

  • Employer PAN

  • Name and Address of Employer

  • Taxpayer’s (your) Name and Address

  • Employer TAN

How do you file ITR if you don’t have your Form 16?

how to file itr without form 16

Although Form 16 is important for filing your income tax return, however, if you do not have one you can still file your return. Please follow the below steps to file returns without Form 16:

  • Collect your payslips and figure out your Taxable Income

  • Your Tax Credit / 26-AS will help you find the exact Tax Deducted

  • If you are staying on rent, don't lose out on HRA if you're eligible

  • Claim your Deductions

  • Income from other sources

  • Pay additional tax if necessary

  • Finally, File your Income Tax Return

How do you check ITR status online?

You can check your ITR status by following these steps :

Without login credentials

  • You can click on the ITR status tab on the extreme left of the e-filing website. 

  • You are then directed to a new page where you have to fill in your PAN number, ITR acknowledgement number and the captcha code.

With login credentials

  • Login to the site

  • Click on the option 'View Returns/Forms'

  • From the dropdown menu, select income tax returns and assessment year

  • Once this is done, the status of your filing will be displayed on the screen.

Read More

1. Reporting A Pension Income In The IT Form

2. TDS on maintenance & repair charges will fall under section 194c or 194j?

3. Check Your Income Tax Outstanding Amount E Filing portal


The professionals at ADCA will assist you with all preparation of the documents to filing income tax returns for you. We also advise the best tax-saving investments.

how to get msme registration number

What Are Micro, Small & Medium Enterprises (MSME)?

In a developing country like India, MSME  industries are the backbone of the economy. It is rightly termed as “the engine of growth” for India. The MSME sector contributes to 45% of India’s total industrial employment, 50% of India’s total exports and 95% of all industrial units of the country and more than 6000 types of products are manufactured in these industries (As per Ministry of Micro, Small & Medium Enterprises). When these industries grow, the economy of the country grows as a whole and flourishes. These industries are also known as small-scale industries(SSI’s).

In this blog, we will discuss the process on how to get your MSME registration number/SSI registration in India.

You Might Wonder If MSME Registration Is Mandatory Or Not!

The MSME registration is not yet mandatory by the Government but registering under it will help you reap several benefits from the government including credit at a low-interest rate, incentives on products for exports, excise exemption, statutory aid such as reservations and the interest on the payments delayed due to unavoidable circumstances.  A government scheme called Udyog Aadhar registration has been helping MSMEs since 2015.

If your company is in the manufacturing line or service line, registrations for both can be obtained through the MSME act.

The MSME became operational on October 02, 2006. It was established to promote, facilitate, and develop the competitiveness of the micro, small, and medium enterprises.

The existing MSME classification was based on the criteria of investment in plant and machinery or equipment. If you want to enjoy the MSME benefits, you will have to limit your investment to a lower limit, as below :

Sector

Criteria

Micro

Small

Medium

Manufacturing

Investment 

< Rs.25 lakh

< Rs.5 crore

< Rs.10 crore

Services

Investment 

< Rs.10 lakh

< Rs.2 crore

< Rs.5 crore

These lower limits are limiting the urge to grow as a company is unable to scale their businesses further. 

There has been a long-pending demand for the revision of MSME classification so that you can further expand your operations while you continue to avail the MSME benefits.

Under the Aatmanirbhar Bharat Abhiyan (ABA), the government revised the MSME classification by inserting composite criteria of both investment and annual turnover. Click Here to read more about ABA

The distinction between the manufacturing and services sectors under the MSME definition has been removed. This removal will create parity between the sectors. The following is the revised MSME classification, where the investment and annual turnover, both are to be considered for deciding an MSME.

                            Revised MSME Classification

Criteria

Micro

Small

Medium

Investment 

      & 

Annual Turnover

< Rs.1 crore

 &  

< Rs.5 crore

< Rs.10 crore

&

< Rs.50 crore

< Rs.50 crore

&

< Rs.250 crore

*Subject to notification

How To Register As An MSME? 

You can apply online for MSME registration & verification. 

Click Here to register as an MSME and fill the application form.  

You can get an MSME certificate with lifetime validity in 2-5 working days and this certificate is for enterprises in both the manufacturing and service sectors. There is no limit with respect to the name used by you to register for new or existing businesses.

Benefits Of MSME Registration:

benefits of msme registration

Your bank loans get cheaper as the interest rate is very low at around ~ 1 to 1.5%.

Various tax rebates are offered to MSME.

You are allowed a credit for minimum alternate tax (MAT) to be carried forward for up to 15 years instead of 10 years.

Many government tenders are only open to the MSME Industries.

You can get easy access to credit.

Once you are registered, the cost of getting a patent done or the cost of setting up the industry reduces as many rebates and concessions are available.

You will be given higher preference for government license and certification.

There is a One Time Settlement Fee for non-paid amounts of MSME.

The Registration Process Of MSME :

procedure for msme registration process

To do the registration for the small and medium scale industry, you have to fill a single form which you can do online or offline. Click Here to get the application.

If you want to do registration for more than one industry then you can do individual registration.

The document required for the registration is your Personal Aadhar number, Industry name, Address, bank account details and some additional information.

You can provide self-certified certificates.

There are no registration fees required for this process.

Post the documents are prepared and submitted to the MSME registrar; the experts will verify the submitted documents. This procedure requires 2 working days.

Once your MSME application is approved, your company gets registered and related documents will be sent to you.

Documents Required For MSME Registration

You have to submit documents like business address proof, copies of purchase and sale bill, and licenses from regulatory bodies.

Business Address Proof

Copies of Sale Bill and Purchase Bill

Partnership Deed/ MoA and AoA

Copy of Licenses and Bills of Machinery Purchased

Business Address Proof :

If the premise is self-owned – Allotment letter, possession letter, lease deed or property tax receipt. If there is a municipal license in the business name or in the name of the proprietor, partner or director of the business, no other possession document is required to be submitted.

If the premise is rented – Rent receipt and a no-objection certificate from the landlord is required. Any utility bill or document evidencing the landlord’s ownership is to be submitted.

Copies of Sale Bill and Purchase Bill :

Businesses are required to submit a copy of the sale bill related to each end product that it will supply. Also, for each raw material that it will purchase, a purchase bill has to be submitted.

Partnership Deed/ MoA and AoA

If the business is a partnership firm, it has to submit its partnership deed. If the partnership firm is registered, it has to submit the registration certificate.

In case of a company, a copy of Memorandum of Association and Articles of Association, and certificate of incorporation has to be submitted. With it, a copy of the resolution passed in the general meeting, and the copy of board resolution authorizing a director to sign the MSME application is also to be submitted.    

Copy of Licenses and Bills of Machinery Purchased

In rare cases, you have to submit a copy of an industrial license which is to be obtained by giving an application to Govt. of India. Further, all bills and receipts related to purchasing and installation of plant and machinery have to be kept safe and required to be submitted on demand.

List Of Details You Need To Provide For MSME Registration On Its Application Form:

Aadhaar number

Name of Entrepreneur as per Aadhaar card

Social category (General, OBC, SC/ST)

Gender

Physically Handicapped

Name of Enterprise

Type of Organization (Proprietorship, Partnership Firm, Private Limited Company, Public Limited Company, Limited Liability Partnership, Cooperative Society, Hindu Undivided Family, Self-Help Group, Society or Trust)

PAN Card

Location/Address of Plant

Country, State, District, City, Tehsil, PIN Code

Office Address

Mobile Number, Email ID

Date of Commencement of Business

Bank account number and IFSC code

Business Activity of Enterprise

NIC 2 Digit Code – choose a primary activity

Additional detail of the enterprise

Number of Employees

Investment Amount in Plant and Machinery

Declaration for  registration under MSME :

Click Here to know about Declaration on Registration as MSME can be done by filling the form

How Can You Download The MSME Registration Certificate?

Click Here to download the registration form

Declaration for non-registration under MSME:

Click Here to declare that your business/company has not been registered as MSME as on the date of declaration. Know more about the format. 

MSME Schemes Launched By The Government:

udyog aadhar registration

The government has launched a number of schemes and support systems for enterprises. 

Udyog Aadhaar memorandum:

Aadhaar card is a 12 digit number given to all individuals by the government. In this, the Aadhaar card is a mandatory requirement. The benefit of registering in this scheme is ease in availing credit, loans, and subsidies from the government. Registration can be done both online or offline.

Zero Defect Zero Effect:

Goods that are manufactured for export have to adhere to a certain standard so that they are not rejected or sent back to India. To achieve this the government has launched this scheme. Under this, if the goods are exported these are eligible for some rebates and concessions.

Quality Management Standards & Quality technology Tools:

Registering in this scheme will help the micro, small, and medium enterprises to understand and implement the quality standards that are required to be maintained along with the new technology. Under these activities are conducted to sensitize the businesses about the new technology available through various seminars, campaigns, activities, etc.

Grievance Monitoring System:

This is beneficial in terms of getting the complaints of the business owners addressed. In this, the business owners can check the status of their complaints, open them if they are not satisfied with the outcome.

Incubation:

This scheme helps innovators with the implementation of their new design, ideas or products. Under this from 75% to 80% of the project cost can be financed by the government. This scheme promotes new ideas, designs, products etc.

Credit Linked Capital Subsidy Scheme:

Under this scheme, new technology is provided to the business owners to replace their old and obsolete technology. A capital subsidy is given to the business to upgrade and have better means to do their business. The small, micro and medium enterprises can directly approach the banks for these subsidies.

Women Entrepreneurship:

This scheme is especially started for women who want to start their own business. The government provides capital, counselling, training, and delivery techniques to these women so that they manage their business and expand it.

Click Here to read the FAQs related to MSME registration.

How do we assist you with MSME Registration/SSI Registration?

We as your MSME Registration Consultants in Bangalore will help your business obtain MSME Registration to avail the benefits. MSME registration or SSI registration can be done through us in your city.

Step 1: You just need to fill our simple form which would ask about your basic information. It would be required while filing your application with the department.

Step 2: According to the details provided to us, we will draft your documentation accordingly. It would take around 1-2 working days.

Step 3: We will file your application along with the required documents to the MSME registrar. Before submission, our expert will verify all your documents properly.

Step 4: Once the application is approved and your MSME certificate is issued, we shall send it to you via email and courier.

gst-application-rejected

GST is an indirect tax that was formed to abolish several other indirect taxes in India, to create a single taxation regime for ease of collection and to increase the efficiency of the process. It is mandatory for businesses with an annual turnover of Rs. 40 Lakh and above. In the North East and Hill states, registration is compulsory for companies earning more than Rs. 10 Lakh yearly revenue.

In this blog we are going to consider cases, wherein after submission of a GST registration application, additional documents are requested or the GST application is rejected.

But before that let’s discuss GST registration, its benefits, penalties associated, correct errors in GST registration, reregistration of GST.

Click Here ---> Let Us Help You With GST Registration

How are you benefitted by registering a business under GST?

benefits-by-registering-a-business-under-gst

  • GST eliminates the cascading effect of tax

  • Higher threshold for registration

  • Composition scheme for small businesses

  • The simple and easy online procedure

  • The number of compliances is lesser

  • Defined treatment for E-commerce operators

  • Improved efficiency of logistics

  • The unorganized sector is regulated under GST

Click here to read about GST registration process

You can read more about GST registration filing dates and the Authorised Representative Under GST

Are you aware of the fact that there is a penalty for not registering under GST?

penalty-for-not-registering-under-gst

According to the section 122 of CGST Act, if you are a taxable person and you fail to register under GST, then you are legally bound as per the GST Act and you need to pay the following amount of penalty:

10,000 INR or amount of tax evaded whichever is higher.

For example:

Case 1: If you fail to obtain GST registration and the total tax evaded amounts to 30,000 INR, the penalty applicable is 30,000 INR

Case 2: If you fail to obtain GST registration and the total tax evaded amounts to 8,000 INR, the penalty applicable is 10,000 INR

Errors in your GST registration?

If you have any mistakes or errors in GST registration, you can rectify it in the application for registration either at the time of registration or even afterwards. You must submit FORM GST REG-14 along with documents. The GST officer will verify and approve within 15 days in FORM GST REG-15.

But if there is any mistake in PAN, you will have to file for fresh registration in FORM GST REG-01. This is because the GSTIN number is based on the PAN. 

You can reach out to us for any further assistance related to the corrections in your GST Registration

Now, what happens if your GST registration is rejected?

After submitting for the registration, you will receive the GST registration certificate within 10 working days. However, some applicants may require to provide additional documents to the GST department for further clarifications. In rare cases, the application for GST registration could also be denied. 

How Do You Know The Reason For Your GST Registration Rejection?

how-to-know-the-reason-for-rejection-of-gst-registration

After submission of your GST registration application along with the list of documents required, you will be provided with an acknowledgement.

You can use the ARN number (Acknowledgement Reference Number) as mentioned in the GST registration application acknowledgement to track the status of your application. 

It normally takes about 7 working days for the provisional GSTIN to be provided and an additional 2 days for providing final GSTIN with GST registration certificate. If the processing officer approves the application, you will receive the GST registration certificate as a soft-copy. 

Why Did Your GST Registration Application Get Rejected?

download-gst-registration-rejection-order

Your GST application can get rejected only if required data is not filled accurately, inadequate proof of identity or address of premises and if your PAN card number is not matching.

If the GST registration application does not contain all the necessary documents or information, then the GST officer processing the application would issue a notice seeking additional information or clarification or documents.

In such a scenario, you can submit the required information or documents as cited by the GST Officer on the common portal before the date mentioned in the notice. The authorized officer will approve the application once satisfied with the information provided by you for the GST certificate. However, the authorized officer has the power to reject the application for the GST certificate, if you failed to provide all the required documents or if you fail to submit it on time.

The GST Officer cannot order for a personal hearing for issuing a new GST registration certificate. The GST officer shall communicate any information regarding the process of the application or any concerns regarding the registration only through the GST forms.

If you fail to provide any reply, or if the authorized officer is not satisfied with the reply or if you fail to reply well within the time, the processing officer can reject the application.

If the officer is not satisfied with the reply, he can reject the application and pass an order in FORM GST REG -05.

On rejection of a GST registration application, the GST Officer would issue a notice to the applicant. As per the GST regulations, the authorized officer should convey to you in writing along with the reasons for rejection.

You can download the GST registration rejection form

Is Your GST Registration Rejected? Worry Not! Here’s How You Can Download GST Registration Rejection Order

If you have applied for GST registration and your application got rejected, you will get a chance to reply to the rejection letter.

However, if you wish to apply for a new application then you would have to wait for a final rejection which will take around 10 days.

Once the application is fully rejected you can apply again.

You can access the GST Portal using your login credentials by clicking here

Click Services > Registration > Application for Revocation of Cancelled Registration option

Cancellation Of Registration Under GST:

Your GST registration can be cancelled for the below reasons :

1. Cancellation by Taxpayer

A taxpayer opts in for cancellation of registration on the grounds of:

  • Liability: GST registration is mandatory for every business exceeding the threshold limit. However, if the annual turnover of the business drops below the given threshold limit, the registered person can opt-in for GST cancellation.

  • Merger: The taxpayer has transferred or merged the business with another organization or vice versa). In this case, the transferee (or the new company from amalgamation/ demerger) has to get registration under GST.

  • Dissolution: The taxpayer has discontinued the business.

  • Constitution: There is a change in the constitution of the business

  • For cancellation, the taxpayer will have to submit an E-application in FORM GST REG-29 through the GST Portal. An authorised officer, upon proper enquiry, shall provide cancellation of the registration.

(Login to the GST Portal with your user-ID and password.

Then navigate to the Services > Registration > Application for Cancellation of Registration option.)

2. Cancellation by Legal Heirs

If a registered person is deceased, the family or the legal heir of the taxpayer can apply for cancellation of GST registration in FORM GST REG 16.

The legal heirs are required to provide the following details in FORM GST REG 16

  • Details of inputs, semi-finished, finished goods held in stock on the date on which cancellation of registration is applied;

  • Liability thereon;

  • Details of the payment.

3. Cancellation by Authorised Officer

An Authorised officer can cancel GST registration of a taxpayer if,

  • The registered person does not conduct business from the place as declared during registration.

  • The registered person issues invoices without any supply of Goods and/or Services.

  • The registered person violates anti-profiteering provisions

To cancel the registration of a given business, the authorised officer is required to follow the below-given process

  • Authorised notifies the concerned person by sending show cause notice in FORM GST REG -17

  • For any disagreement, the registered person is required to reply in FORM GST REG -18 within 7 days of issuance of the notice.

  • If the authorised officer finds the reply to be satisfactory, he can drop the proceedings and pass an order in FORM GST REG –20.

However, you fail to justify why your registration should not be cancelled, the authorized officer will issue an order in FORM GST REG-19. The order will be sent within 30 days from the date of reply to the show cause

Revocation of Cancellation under GST

revocation-of-cancellation-under-gst

In case of cancellation imposed by an authorized officer, you can apply for revocation of cancellation within 30 days from the date of the cancellation order.

The process you need to be aware of:

  • You can submit an application for revocation of cancellation through FORM GST REG-21 on the GST portal

  • If the authorised officer is satisfied with the reason you provide, the registered office is required to,

  1. 1. Record the reasons for the revocation of cancellation of registration in writing.

  2. 2. Reverse the cancellation of registration.

  3. 3. Pass an order of revocation in FORM GST REG-22.

  • However, if the reason is not found satisfactory to the authorised officer, he can reject the application for revocation. The officer is required to order in FORM GST REG-05 and communicate the same.

  • Before rejecting, the proper officer must issue a show-cause notice in FORM GST REG–23 for you to show why the application should not be rejected. You must reply in FORM GST REG-24 within 7 working days from the date of the service of the notice.

  • The proper officer is required to take a decision within 30 days from the date of receipt of clarification in FORM GST REG-24.

Why Revocation Of Cancelled GST Registration Is Necessary:

If you don’t apply for revocation of cancellation, it shall be deemed to be a ‘deficiency’ within the meaning of rule 9 (2) of the Central Goods and Service Tax Rules, 2017 and can be considered as a ground for rejection of the application for fresh registration.

On the other hand, if you continue to trade goods and supplies with GST registration, it shall be considered as an offence under GST law and you shall be liable to heavy penalties.

Steps To Re-Registration Under GST

In order to avoid application of fresh registration of businesses, who have had their registration cancelled by an officer, on account of non-compliance of the statutory provisions, CBIC (Central Board of Indirect Taxes and Customs)(released Vide circular no. 95/14/2019-GST dated March 28th, 2019, wherein the officials have clarified the consequence the taxpayer has to face in case of non-revocation of cancelled registration.

In cases where a registered taxpayer applies for another registration within the same state, the authorised officer is required to analyse whether existing registration continues or is being cancelled;

In case of cancelled registration, the further analysis shall commence on whether the registration is cancelled on account of violation of provisions of section 29 (2) (b) [composition dealer has not furnished returns for 3 consecutive tax period] or section 29 (2) (c) [registered taxpayer has not furnished returns for a continuous period of 6 months]. 

In case you need any further assistance regarding your rejected GST application, please feel free to get in touch with us. Our team of GST Consultants in Bangalore will do the required to ensure your GST application processes further.


Read More

1.Filing Of NIL GSTR 3B Through SMS

2.Scope Of Principal-Agent Relationship Under GST

3.Implication Of GST On Transfer Of Business - At Glance

gstr 3b nil return filing

Govt vide notification no 38/2020 dated 05.05.2020 had notified the fifth amendment to CGST Rules containing two amended.

1. Inserting the second proviso to Rule 26(1) providing for the filing of GSTR 3B by companies with EVC without use of Dsc during the period 21.04.2020 to 30.06.2020.

2. Inserting Rule 67A providing for NIL GSTR 3B by SMS. It was notified that this will be effective form a date notified later.

Govt vide notification 44/2020 dated 08.06.2020 has notified 08.06.2020 as the date for coming into effect of rule 67A. Following is the procedure for filing NIL GSTR3B through SMS.

Who can file NIL GSTR 3B?

  • Who have not made any sales (outward supply) for the period

  • Who doesn't have any Reverse Charge (RCM) Liability. 

  • Who not intend to take any input tax credit for the period

  • Who don't have any late fee or other liability of the earlier period to be paid in this period.

How to file NIL GSTR 3B through SMS?

Following is the procedure to be followed for filing NIL GSTR 3B through SMS.

  • SMS in the following format needs to be sent to No 14409 from the Registered Mobile Number.

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For example, if you wish to file NIL GSTR 3 for the month of May 2020 for GTIN 29AJBPLD2419C1ZT, the format of the message shall be as follows

NIL 3B 29AJBPD2419C1ZT 052020

  • If the SMS is validated, you will receive the 'Validation Code' on the same mobile number. The validation code needs to sent to the same number 14409 to complete the filing. Validating message should be in the following format

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For example, if the validation code received is 56789, validation SMS should be in the following format - CNF 3B 56789

  • Validation code received is usable only once, and shall be valid for 30 minutes.

  • In case SMS fails validation, instead of validation code Error Message will be received, which needs to look into and addressed.

Read More

1. A Simple Guide To Resolve Your GST Registration Rejected Application

2. Scope Of Principal-Agent Relationship Under GST

3. Implication Of GST On Transfer Of Business - At Glance


In case you need any further assistance regarding GSTR 3b return filing, please feel free to get in touch with our team of GST Consultants in Bangalore.

online tds statement correction

CPC (TDS) has provided new enhanced features, to further add to the convenience of online facility of filing corrections to the TDS Statements. With this feature, you will be able to submit Online Corrections at TRACES without even having a Digital Signature.

To avail the facility, it is requested to log in to TRACES and navigate to the Defaults tab to locate “Request for Correction from the drop-down list. Click to Proceed in absence of Digital Signature.

Pre-requisites for filing online Corrections:

  • Digital Signature is not mandatory to be registered on TRACES for raising online corrections.

  • Only Challan Correction is permissible in the absence of Digital Signature. Digital Signature enables you to carry out PAN Corrections as well.

  • Correct KYC information needs to be submitted for the purpose of validation.

  • Online requests can be submitted, only if there is a regular statement already filed and processed.

  • All previous corrections pertaining to the statement should have been processed and the processing status can be verified from the Dashboard.

Functionalities available without Digital Signature:

Challan/BIN Correction

  • A list of all Matched and Unmatched challans can be viewed by clicking the appropriate tab.

  • Matched challans can be corrected for the Amount Claimed as Interest and Others. Please note that Matched challans cannot be tagged.

  • Unmatched challans can be corrected and tagged to Deductee rows in the statement.

  • In addition, NO CHALLAN, which has been used for other purposes outside the system, should be tagged.

  • The corrections to the above challans can be reset by clicking the Reset tab if this requires to be further corrected.

Additional Functionalities available with Digital Signature:

 PAN Correction

  • Invalid to Valid PAN: The correct name of the Valid PAN will be displayed in Name as per changed PAN.

  • Valid to Valid PAN: If the new PAN entered is Invalid, a message is displayed in the Action Status. Please note that there is only one opportunity for a Valid to Valid PAN correction.

  • All the corrected rows can be viewed by clicking on Show Edited Rows on the screen.

Action Summary:

  • After carrying out all the corrections, Action Summary can be referred for all changes carried out.

  • Please click Confirm for all intended changes and the statement is ready for submission.

Actions to Complete Submission:

  • Please navigate to the Defaults tab to locate Corrections Ready for Submission.

  • Click on Submit for Processing, which will prompt to digitally sign the submission.

  • Once the correction is submitted successfully, a Token Number for the same will be available.

GST Consultants In Bangalore

Govt has proposed a staggered filing of GSTR 3B, to reduce the load on GST Portal on due date. Govt vide press release dated 22.01.2020 has proposed the following due dates for various tax filers based on the State of the Tax filers and their turnover. Notification to give effect to this change is expected soon.

GSTR - 3B


Want to file GST return? We are here to help. Contact ADCA - One of the reputed GST Consultants In Bangalore - for the complete assistance.

Statutory Audit

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

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.

Also read about How To Register A Startup In India.

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

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