टैक्स नहीं कटता फिर भी इनकम टैक्स रिटर्न क्यों भरना चाहिए?

टैक्स नहीं कटता फिर भी इनकम टैक्स रिटर्न क्यों भरना चाहिए? टैक्स नहीं कटता फिर भी इनकम टैक्स रिटर्न क्यों भरना चाहिए? सांकेतिक तस्वीर (साभार आज तक) इनकम टैक्स रिटर्न भरने की भागमभाग शुरू हो चुकी है. डेडलाइन 31 दिसंबर है. आप सुनते आ रहे हैं कि फाइलिंग से चूके तो 10 हजार रुपये तक जुर्माना लग सकता है, लेकिन लाखों लोग ऐसे भी हैं, जो हर साल इस कन्फ्यूजन में घिरे रहते हैं कि उन्हें इनकम टैक्स रिटर्न दाखिल करनी चाहिए या नहीं. इनमें अधिकांश वे नौकरीपेशा लोग भी हैं, जिनकी सालाना सैलरी तो ढाई लाख रुपये से ज्यादा है, लेकिन कोई टैक्स देनदारी नहीं बनती, न ही कोई TDS कटता है. बहुत से लोग थोड़ा-बहुत टैक्स कटने के बाद इस डर से रिटर्न नहीं भरते कि कहीं किसी पचड़े में न फंस जाएं. इस तरह की आपकी कई उलझनों को तो हम यहां सुलझाएंगे ही. साथ ही रिटर्न भरने के कुछ ऐसे फायदे भी बताएंगे, जिनके बिना सरकारी जुर्माना तो छोड़िए, आपको अपने लेवल पर भी कहीं ज्यादा नुकसान उठाना पड़ सकता है. वैसे आपको यह जानकर भी हैरानी होगी कि कुछ मामलों में ढाई लाख रुपये से कम इनकम पर भी रिटर्न भरना जरूरी होता है. क्या कहता है आयकर कानून ? वित्तवर्ष 2020-21 में अगर आपकी इनकम ढाई लाख रुपये से ज्यादा रही है, तो आपके लिए इनकम टैक्स रिटर्न भरना अनिवार्य है. 60 साल से ऊपर और 80 साल से कम उम्र के लोगों के लिए छूट की यह आय-सीमा 3 लाख रुपये है. 80 साल से ज्यादा उम्र के बुजुर्गों को 5 लाख रुपये तक सालाना इनकम पर रिटर्न भरने से छूट मिली हुई. लेकिन तीनों ही कैटेगरी में यह छूट कुछ शर्तों के साथ है. 2.5 लाख से कम आय पर भी रिटर्न क्यों ? अगर आपकी सालाना इनकम ढाई लाख से कम है. लेकिन देश से बाहर कहीं भी कोई संपत्ति या निवेश है, तो आपको IT रिटर्न भरना ही होगा. भारत के बाहर किसी बैंक अकाउंट में अगर आप सिग्नेटरी हैं, यानी खाता आपका है या आपकी ओर से खुलवाया गया है तब भी. अगर किसी बैंक के करंट अकाउंट में आपके नाम 1 करोड़ रुपये से ज्यादा रकम जमा हुई है, तब भी रिटर्न भरना होगा. भले ही उससे कोई ब्याज नहीं आता या उस वित्त वर्ष में आपको कोई इनकम नहीं हुई हो.वित्त वर्ष में अगर आप या परिवार के किसी सदस्य की विदेश यात्रा पर 2 लाख रुपये से ज्यादा खर्च हुआ है तो भी आप पर रिटर्न भरने की जिम्मेदारी आती है. अगर किसी ने साल में 1 लाख रुपये से ज्यादा की बिजली खर्च कर डाली हो, तब भी उसकी कम सालाना इनकम मायने नहीं रखती और उसे रिटर्न दाखिल करना होगा.सीए जेपी जैन कहते हैं इनकम न होते हुए भी आयकर कानून में कई ऐसे प्रावधान हैं, जहां आपको हर हाल में रिटर्न भरना है. मसलन, कोई कंपनी या फर्म चाहे उसकी इनकम कितनी भी कम क्यों न हो, उसे इनकम टैक्स रिटर्न भरना ही होता है. रिटर्न भरना सिर्फ मजबूरी ही नहीं होती, यह कई बार फायदे का सौदा साबित होता है.2.5 लाख से ज्यादा आय, लेकिन टैक्स नहीं कटता तो ? यही कन्फ्यूजन सबसे ज्यादा लोगों को होता है. अगर आपकी सालाना इनकम ढाई लाख रुपये से ज्यादा है. लेकिन कानूनी तौर पर मिली हुई छूट जैसे, सेक्शन 80C के तहत डेढ़ लाख रुपये तक के निवेश पर मिलने वाली कटौती आदि के बाद अगर आप पर कोई टैक्स देनदारी नहीं बनती, तब भी आपको रिटर्न भरना चाहिए. इसके अपने फायदे हैं- पहला, अगर उस साल आपके बैंक एफडी पर टीडीएस कटा हो तो उसका रिफंड लेने के लिए रिटर्न भरना ही एक मात्र विकल्प है. अगर आप कोई व्यवसायी, कॉन्ट्रैक्टर या स्वरोजगार वाले व्यक्ति हैं और किसी भी दफ्तर या विभाग में टीडीएस कटा बैठे हैं, तो बिना रिटर्न भरे वाजिब रिफंड नहीं ले पाएंगेदूसरा, अगर आप किसी बैंक से लोन लेना चाहते हैं तो उसकी एलिजिबिलिटी आपकी इनकम से ही तय होती है और बैंक हमेशा इनकम टैक्स रिटर्न को तरजीह देता है. बड़े होम लोन के मामले में तो कुछ बैंक रिटर्न को ही इनकम प्रूफ मानकर चलते हैं. तीसरा, कई देश वीजा देने के मामले में आपसे इनकम टैक्स रिटर्न मांगते हैं और वे यह दलील नहीं स्वीकार करेंगे कि आपने रिटर्न इसलिए नहींं भरा क्योंकि आपकी टैक्स लाइबिलिटी नहीं बनती. पासपोर्ट ऑफिस और कुछ अन्य कामों में इनकम प्रूफ ही नहीं एड्रेस प्रूफ के तौर पर भी रिटर्न की कॉपी मान्य होती हैचौथा, आपको शेयर, म्यूचुअल फंड, प्रॉपर्टी की खरीद-बिक्री में नफा-नुकसान हुआ हो तो रिटर्न मिस करने से एक तो पुरानी रिटर्न्स से चली आ रही कैपिटल गेन या लॉस की चेन टूट जाएगी. और हो सकता है कि आप कोई बड़ा रिफंड या राहत चूक जाएं. किसी भी तरह के कैपिटल गेन या लॉस का एडजस्टमेंट बिना रिटर्न भरे संभव नहीं हैपहले भरते थे, फिर इनकम बंद हो गई, अब क्या करें ? आप लगातार कई वर्षों से इनकम टैक्स रिटर्न भरते आ रहे थे, लेकिन किसी वर्ष नौकरी छूट जाने या आय ढाई लाख से कम हो जाने के चलते रिटर्न नहीं भर पाए, तब आप मुश्किल में पड़ सकते हैं. आपको हर हाल में रिटर्न का सिलसिला जारी रखना चाहिए, नहीं तो इनकम टैक्स विभाग की इलेक्ट्रॉनिक निगरानी में आपके आने के चांसेज सबसे ज्यादा होंगे. जाहिर है आप पर कोई खास आंच नहीं आने वाली. लेकिन बेवजह परेशान तो होंगे ही. यह भी हो सकता है कि आने वाले साल आपको दूसरे स्रोतों से आय पर लाभ या नुकसान हो. तब भी आप कैपिटल गेन या लॉस को समायोजित नहीं कर पाएंगे.आयकर रिटर्न आपकी पहचान है. जो बहुत से कार्यों में अधिकृत दस्तावेज माना जाता है. आप लोन लेने जाएं तो बैंक भी कम से कम 3 साल के लगातार रिटर्न मांगते हैं. न सिर्फ लोन की रकम, बल्कि कई मायनों में ब्याज दरें भी आपकी आय से तय होती हैं. इसके अलावा भी कई मामलों में लगातार रिटर्न का रिकॉर्ड मेनटेन रखना जरूरी होता है.’10 हजार का जुर्माना क्या है? आज से तीन साल पहले तक रिटर्न में देरी या डेडलाइन चूकने पर कोई जुर्माना नहीं लगता था. लेकिन सरकार ने फाइनेंस एक्ट 2017 में संशोधन कर पेनाल्टी थोप दी. लेकिन डरिए मत. सभी लोगों पर एक सा जुर्माना नहीं लगता. अगर आपकी इनकम 5 लाख रुपये से कम है, तो रिटर्न में देरी पर आपको सिर्फ एक हजार रुपये जुर्माना देना होगा. जब रिटर्न की डेडलाइन 31 जुलाई या अगस्त हुआ करती थी, तब 31 दिसंबर तक रिटर्न भरने वालों पर 5 हजार रुपये जुर्माना तय था. 1 जनवरी से 31 मार्च के बीच भरने पर 10 हजार रुपये की पेनाल्टी थी. चूंकि सरकार ने डेडलाइन में ही पांच महीने की मोहलत दे रखी है, ऐसे में पेनाल्टी भी उसी हिसाब से खिसकेगी. जानकारों का कहना है कि मार्च तक रिटर्न भरने पर 5 लाख से ऊपर इनकम वालों के लिए जुर्माने की राशि 5 हजार रुपये ही है. यही नहीं, देरी से रिटर्न के मामले में टैक्सेबल रकम पर 1% ब्याज का भी प्रावधान है.

Key Recommendations of 45th GST Council Meeting

 

1. Interest u/s 50(3) of the CGST Act, 2017 to be levied on ITC availed and utilized

Interest under section 50(3) of the CGST Act, 2017 to be payable on “ineligible ITC availed and utilized” and not on “ineligible ITC availed”. The change will be effective retrospectively from 01.07.2017. Interest in such cases to be charged on ineligible ITC availed and utilized at 18%.

2. Transfer of unutilized balance in CGST/ IGST cash ledger between two GSTINs having same PAN allowed

Unutilized balance in CGST and IGST cash ledger shall be allowed to be transferred between distinct persons (entities having same PAN but registered in different states or having different GSTINs in the same State), without going through the refund procedure, subject to certain safeguards.

3. Relaxation in the requirement of filing Form GST ITC-04

Requirement of filing Form GST ITC-04 under rule 45(3) of the CGST Rules, 2017 to be relaxed as under:

S. No.	Particular	Remark
(a)	Taxpayers whose annual aggregate turnover in preceding financial year is above Rs. 5 crores	Need to furnish ITC-04 once in six months.
(b)	Taxpayers whose annual aggregate turnover in preceding financial year is upto Rs. 5 crores	Need to furnish ITC-04 annually

4. 100% ITC matching after section 16(2)(aa) gets notified

Once section 16(2)(aa) (introduced through Finance Act, 2021) gets notified, rule 36(4) to be amended to restrict ITC to the extent of the invoices/ debit notes communicated to the registered person in Form GSTR-2B. Section 16(2)(aa) provides for 100% matching between GSTR-2B and GSTR-3B.

5. Removal of ambiguity in refund of taxes paid under wrong head

CGST Rules 2017 to be amended to remove the ambiguity regarding procedure and time limit for filing refund of tax wrongfully paid as CGST/ SGST instead of IGST and vice-versa.

6. Mandatory Aadhar authentication for refund claim and application for revocation of cancellation of registration

Aadhar authentication of registration to be made mandatory for being eligible for filing refund claim and application for revocation of cancellation of registration.

7. Late fee for delayed filing of GSTR-1 to be collected through next month’s Form GSTR-3B

Late fee for delayed filing of Form GSTR-1 to be auto-populated and collected in next open return in Form GSTR-3B.

8. Refund to be disbursed in the bank account linked with correct PAN

Refund to be disbursed in the bank account, which is linked with the same PAN on which registration had been obtained under GST.

9. Amendment in rule 59(6) of CGST Rules, 2017 with effect from 01.01.2022

Currently, rule 59(6) of the CGST Rules does not permit filing GSTR-1, if a registered person does not file Form GSTR-3B for preceding two months or preceding quarter, as the case may be.

However, it has been recommended to amend rule 59(6) from 01.01.2022 to provide that a registered person shall not be allowed to furnish Form GSTR-1, if he has not furnished the return in Form GSTR-3B for the preceding month.

10. Levy of GST on petroleum products deferred further

After due deliberation, the Council has decided to continue keeping petroleum products outside the ambit of GST.

11. Measures related to restaurant services

1. After keeping a few exceptions aside, the Council has decided to levy GST on e-commerce food delivery operators like Swiggy, Zomato, etc., and not the restaurant delivering food through them, with effect from 1^st January, 2022.

2. It has been clarified that services by cloud kitchen/ central kitchen are covered under restaurant service and attract GST at the rate of 5% [without ITC].

3. It has been clarified that alcoholic liquor for human consumption is not food and food products for the purpose of the entry prescribing GST rate of 5% on job work services in relation to food and food products.

12. Bringing all types of motor vehicles withing the scope of section 9(5) of the CGST Act, 2017

Services of transport of passengers by any type of motor vehicle through e-commerce platform to be covered under section 9(5) of the CGST Act, 2017 and the person liable to pay tax would be such e-commerce operator. Currently, only radio taxi, motor cab, maxi cab and motorcycle are covered under section 9(5).

13. Date of debit note and not underlying invoice to be considered for limitation period prescribed under section 16(4) of the CGST Act, 2017

Section 16(4) of the CGST Act, 2017 restricts availment of ITC upto the due date of filing return of September month of subsequent financial year or actual date of filing annual return based on the initial document issued by the supplier.

It has been clarified that with effect from 1^st January, 2021, the date of debit note and (and not the date of underlying invoice) shall determine the relevant financial year for the purpose of section 16(4) of CGST Act, 2017.

14. No requirement of carrying physical copies of tax invoices

It has been clarified that at the time of transportation, there would be no requirement of carrying physical copies of e-invoices generated under rule 48(4) of the CGST Rules, 2017.

15. Refund not to be denied if export duty is not actually payable

Under section 54(3) of the CGST Act, 2017, refund of accumulated ITC is denied if any goods are subject to export duty. In a number of cases, export duty has been notified as NIL/ exempt. It has been clarified that refund would be restricted only when export duty is required to be actually paid on the relevant goods and not in case of NIL/exempted goods.

16. Issuance of the following circulars in order to remove ambiguity

1. Clarification on the scope of intermediary services - Earlier, the government had issued Circular No. 107/26/2019 dated 18^th July, 2019 clarifying the doubts related to supply of IT enabled services and services of intermediaries. However, such circular was withdrawn later. Now, a fresh circular will be issued for explaining the scope of intermediary services.

2. Clarification relating to interpretation of the term “merely establishment of distinct person” in condition (v) of the section 2(6) of the IGST Act, 2017 for export of services. A person incorporated in India under the Companies Act, 2013 and a person incorporated under the laws of any other country are to be treated as separate legal entities and would not be barred by the condition (v) of the sub-section (6) of the section 2 of the IGST Act, 2017 for considering a supply of service as export of services.

17. Concessional GST rates on certain COVID-19 treatment drugs (currently valid till 30.09.2021) has been extended upto 31^st December, 2021.

18. Supply of Mentha Oil from unregistered person has been brought under reverse charge. Further, Council has also recommended that exports of Mentha oil shall be allowed only against LUT and consequential refund of input tax credit. Hence, export of mentha oil with payment of IGST and getting refund of the same will not be allowed.

19. With effect from 1^st April, 2022, brick kilns shall be brought under special composition scheme with threshold limit of Rs. 20 lakhs. Bricks would attract GST at the rate of 6% without ITC under the scheme. GST rate of 12% with ITC would apply to bricks in other cases.

20. GST rate changes in order to correct inverted duty structure in footwear and textiles sector, will be implemented with effect from 1^st January, 2022.

21. Revenue collections from Compensation Cess in the period beyond June 2022 till April 2026 would be exhausted in repayment of borrowings and debt servicing made to bridge the gap in 2020-21 and 2021-22.

22. Major changes in relation to GST rates and scope of exemption on services w.e.f 1^st October, 2021

1. Validity of GST exemption on transport of goods by vessel and air from India to outside India is extended upto 30^th September, 2022.

2. Exemption on leasing of rolling stock by IRFC to Indian Railways shall be withdrawn.

3. Certain relaxations have been made in conditions relating to IGST exemption on import of goods on lease, where GST is paid on the lease amount, so as to allow this exemption even if :

1. such goods are transferred to a new lessee in India upon expiry or termination of lease; and

2. the lessor located in SEZ pays GST under forward charge.

4. Nil GST rate shall be applicable on following services:

• Services by way of grant of National Permit to goods carriages on payment of fee.

• Skill Training for which Government bears 75% or more of the expenditure [presently exemption applies only if Govt funds 100%].

• Services related to AFC Women`s Asia Cup 2022.

5. GST rate increased from 12% to 18% in respect of following services:

• Licensing services/ the right to broadcast and show original films, sound recordings, radio and television programmes [to bring parity between distribution and licensing services].

• Printing and reproduction services of recorded media where content is supplied by the publisher (to bring it on parity with colour printing of images from film or digital media).

23. Clarification in relation to GST rate on services

1. Coaching services to students provided by coaching institutions and NGOs under the central sector scheme of ‘Scholarships for students with Disabilities” shall be exempt from GST.

2. Ice cream parlor selling already manufactured ice-cream would attract GST at the rate of 18%.

3. Overloading charges at toll plaza shall be exempt from GST being akin to toll.

4. The renting of vehicle by State Transport Undertakings and Local Authorities is covered by the expression ‘giving on hire’ for the purposes of GST exemption.

5. Services by way of grant of mineral exploration and mining rights shall attract GST rate of 18% w.e.f. 1^st July, 2017.

6. Admission to amusement parks having rides etc. shall attract GST rate of 18%. The GST rate of 28% applies only to admission to such facilities that have casinos, etc.

24. The Council has decided to set up two Group of Ministers (GoMs) to examine the issue of correctness of inverted duty structure for major sectors; rationalize the rates and review exemptions from the point of view of revenue augmentation, from GST. It has also been decided to set up a GoM to discuss ways and means of using technology to further improve compliance including monitoring through e-way bill systems, e-invoices, FASTag data, etc.

GST Updates applicable with effect from 01.09.2021

 Implementation of Rule 59(6) (restriction in filing GSTR-1 in certain cases) on GST Portal w.e.f. 01.09.2021

The Goods and Services Tax Network (GSTN) has issued an Advisory dated August 26, 2021 w.r.t. implementation of Rule 59(6) of the CGST Rules (restriction in filing GSTR-1 in certain cases) on GST Portal w.e.f. September 1, 2021.

Rule-59(6) of CGST Rules, 2017; inserted vide Notification No. 1/2021 dated January 01, 2021, provides for restriction in filing of GSTR-1 in certain cases:

a) a registered person shall not be allowed to furnish the details of outward supplies of goods or services or both under section 37 in FORM GSTR-1, if he has not furnished the return in FORM GSTR-3B for preceding two months;

b) a registered person, required to furnish return for every quarter under the proviso to sub-section (1) of section 39, shall not be allowed to furnish the details of outward supplies of goods or services or both under section 37 in FORM GSTR-1 or using the invoice furnishing facility, if he has not furnished the return in FORM GSTR-3B for preceding tax period;

This Rule will be implemented on GST Portal from September 01, 2021. On implementation of the said Rule, the system will check that whether before the filing of GSTR-1/IFF of a tax-period, the following has been filed or not:

a) GSTR-3B for the previous two monthly tax-periods (for monthly filers),

OR

b) GSTR-3B for the previous quarterly tax period (for quarterly filers), as the case may be. The system will restrict filing of GSTR-1/IFF till Rule-59(6) is complied with.

This check will operate on clicking the SUBMIT button of GSTR-1 and the system will give an error message if the condition of Rule-59(6) is not met. It may be noted that records which have been saved in GSTR-1 will remain saved and filing of such records will be permitted after Rule-59(6) is complied with.

Implementation of Rule-59(6) on the GST Portal will be completely automated, similar to the blocking & un-blocking of e-way bill as per Rule-138E and facility for filing of GSTR-1 will be restored immediately after filing of relevant GSTR-3B. No separate approval would be needed from the tax-officer to restore the facility for filing of GSTR-1.

To ensure no disruption in filing GSTR-1/IFF, taxpayers who have not filed their pending GSTR-3B, especially from period November 2020 and afterwards may do so at the earliest.

Post Incorporation Compliances for Private Limited Companies

Registration of the Company is made easier by the Government. Now we can simply get our company registered with minimum paperwork.

Now what you all must do, just only scan all your documents and upload them.

I was remembering the year 2015 when I first register a company. That time I have made so many working papers like affidavit, DIR-2, DIR-3, INC-22, INC-32, INC-33, INC-34, INC-9, INC-10, etc. After making all these docs work was only 50% Completed. Then you will have to upload the documents, it will take around a week if everything is in order and ROC does not ask for a resubmission.

After that Apply for PAN, TAN, Register yourself in Service Tax, Excise, VAT, CST, etc. Usually, it will take up to 1-2 months.  But as we all know time changes, then came Spice, work was made something easier as compared to 2015.

Now in the previous year 2020, here comes Spice+, now if everything went well, you can register a company in 3-4 working days along with PAN, TAN, GST, Labour Law registrations.

Now your company is registered. But running a company smoothly is a difficult task. Handling finances and meeting various statutory compliances is no exception. Post – incorporation, a company must comply with various mandatory compliances under different laws. In case of non-compliance, strict penalties, interest, fines, and fees are imposed. So this editorial is based on the legal post-incorporation compliances, here you will get to know about the compliances that are required for a newly incorporated company.

Compliances under Companies Act, 2013

As you know a company is registered under the Companies Act, so first, start with Company Act compliances.

Declaration for Commencement of Business: Form INC-20A

• Time Limit:  Within 180 days from the date of incorporation.
• What if the form is not filed?
  • Cannot commence business/borrow money.
  • Additional fees (up to 12x of normal fees)
  • Penalty for Company: INR 50,000
  • Penalty for officers in default: INR 1,000 per day (max INR 1,00,000)

First Board Meeting

• Time Limit:  Within 30 days from the date of incorporation.
• At the first board meeting, the directors must disclose their interest in any company, firm, or other association of individuals, by giving a notice in writing in Form MBP 1.

Appointment of Statutory Auditor and filing Form ADT-1

• The first auditor to be appointed within 30 days from the date of incorporation.
• Form ADT-1 is filed to intimate the Registrar of Companies (RoC) about auditor appointment.
• The time limit to file Form ADT – 1 is 15 days from the date of appointment of the auditor.
• Form ADT-1 is optional in case of appointment of first statutory auditor but
• Auditor for subsequent years (for a term of 5 years) is appointed at an AGM and filing of Form ADT -1 to be made within 15 days of appointment.

Issuance of share certificates

• Time Limit:  Within 2 months from the date of incorporation.
• Consequences of non-compliance:
• Penalty for Company: INR 50,000
• Penalty for every officer in default: INR 50,000

Annual General Meeting

• Applicability: Every Company, other than One Person Company (OPC)
• Time Limit:
• First AGM: within 9 months from the close of the first financial year (FY) (i.e., 31st December)
• Subsequent AGM: within 6 months from FY end. (i.e., 30th September)
• The time gap between 2 AGMs should not be more than 15 months.
• Notice: 21 clear days’ notice
• Documents to be laid before members in AGM: Financial statements along with Director’s Report.
• Consequences of non-compliance:
• Fine for Company: up to INR 1,00,000
• Fine for every officer in default: up to INR 1,00,000
• In case of continuing default: Additional INR 5000 per day

Preparation of Annual Financial Statements and filing Form AOC -4

• Every Company needs to prepare and file its financial statements with RoC in Form AOC-4 every year.
• Time Limit:
• Companies other than OPC: 30 days from date of AGM
• OPC: 180 days from close of FY
• Consequences of non-compliance:
• Late fees: INR 100 per day+ additional fees for e Form.
• Penalty for Company: INR 10,000and in case of continuing default further penalty of INR 100 per day (maximum of INR 2,00,000)
• Penalty for MD & CFO/other officers: INR 10,000and in case of continuing default further penalty of INR 100 per day (maximum of INR 50,000)

Filing of Form MGT -7 (Annual Return)

• Applicability: Every Company
• Time Limit:
• Companies other than OPC: 60 days from date of AGM
• OPC: 240days from close of FY
• Consequences of non-compliance:
• Late fees: INR 100 per day+ additional fees for e Form.
• Penalty for Company: INR 10,000and in case of continuing default further penalty of INR 100 per day (maximum of INR 2,00,000)
• Penalty for every officer: INR 10,000and in case of continuing default further penalty of INR 100 per day (maximum of INR 50,000)

DIN E-KYC (filing of Form DIR – 3 KYC)

• Applicability: Every person who is allotted a DIN and status of DIN is shown as ‘approved’
• Time Limit: 180 days from the end of FY (i.e. 30th September of succeeding FY)
• Consequences of non-compliance:
• DIN is marked as ‘de-activated.
• To re-activate, Form DIR -3KYC to filed with fees of INR 5,000.

Others

• Board Meetings: Minimum 4 Board Meetings to be held every year with not more than 120 days’ gap between two meetings.
• Maintenance of all financial records – Bookkeeping and Accounting.
• Maintenance of secretarial documents like Notices, Minutes, Board and Shareholder Resolutions, statutory registers like the Shareholder register, Related Party Transaction register, etc.
• Filing of other forms like Form DPT -3 (for deposits taken, time limit: 90 days from the end of FY), MSME -1 (for transactions with MSME).

Compliances under Income-tax Act, 1961

• Advance Tax

  • Meaning: Income Tax needs to be paid in advance during the financial year instead of lump sum payment at year-end. This is known as pay tax as you earn.
  • Applicability: if total tax payable (on estimated total income) for the financial year is ≥INR 10,000
  • The amount payable and Due Date:

Due Date	Advance Tax Payable (cumulative)
On or before 15th June	15% of estimated total tax liability for that FY
On or before 15th September	45% of estimated total tax liability for that FY
On or before 15th December	75% of estimated total tax liability for that FY
On or before 15th March	100% of total tax liability for that FY

• Consequences of non-compliance (no payment/ short payment):

  • Assessee (the company) deemed as ‘Assessee in default’ and recovery proceedings can be initiated.
  • Interest u/s 234B: if payment of advance tax by Assessee (the company) is less than 90% of the total tax liability, then it will be liable for interest @ 1% p.m. or part of the month from 1st April till the date of payment of tax.
  • Interest u/s 234C: if the advance tax paid in any installment (s) is less than the prescribed percentage of installment amount, interest is levied @ 1% p.m. for the period of default as illustrated in the table below:

Installment and Due Date	% Of total tax payable (cumulative)	Int. u/s 234C levied if advance tax deposited is less than below % of total tax payable	Period of default
I – 15th June	15%	12%	3 months
II – 15th Sept	45%	36%	3 months
III – 15th Dec	75%	75%	3 months
IV- 15th March	100%	100%	1 month

Tax Deduction at Source (TDS) and Tax Collection at Source (TCS)

Tax Deduction at Source (TDS)

• TDS compliances are one of the most important and any non-compliance leads to several detriments (tax deduction not given for payments made along with interest, fees, and penalty being levied).
• TDS is not applicable on all payments, but only on specific payments and for amounts greater than threshold limits which are mentioned under the Income Tax Act (there are more than 30 specific payments). So, it is wise to check TDS applicability before making any payment.
• Most common payments that require tax deduction at source:
  • Salary Payments (Sec 192)
  • Payment to Contractors (Sec 194C)
  • Payment to professionals/ freelancers (professional fees) (Sec 194 J)
  • Payment of Commission or Brokerage (Sec 194H)
  • Rent Payments (Sec 194-I)
  • Payment to Non-Residents (Sec 195)

For a complete list of payments subject to TDS, applicable rates, and threshold limits you can go to: Revised TDS/TCS Rate as Applicable wef 14.05.2020

• Compliances attached to TDS and consequences of non-compliance:

(i) Monthly payment of TDS: Once the tax is deducted, the deductor (payer) needs to deposit the TDS to the government monthly. TDS must be deposited using Challan ITNS-281. Below are the due dates for making payment of tax deducted:

Tax deducted during	TDS to be deposited by
First 11 months i.e., April to Feb	7th of the NEXT month
Last month i.e., March	30th April

• • If tax was not deducted, simple interest @ 1% p.m. or part of the month is levied starting from the date on which tax was deductible till the date of deduction of tax.
  • If there is a delay in depositing TDS, simple interest @ 1.5% p.m. or part of the month is levied for the period of default. This means even a delay of 1 day will attract interest for the whole month (i.e., 1.5% for the month)

• • In case of failure to deduct or failure to pay the tax deducted, further legal consequences can be:
    • A penalty equal to the amount of tax not deducted / not deposited can be levied.
    • Can also lead to prosecution leading to imprisonment ranging between 3 months to 7 years.
    • Disallowance of expenses – either 100% disallowance or 30% disallowance

(ii) Quarterly TDS Statements: A person who is required to deduct tax at source is required to file quarterly statements (returns) of TDS. There are different forms for different types of payments (Form 24Q – salary payments; Form 26Q – other than salary payments, Form 26QB – for purchase of immovable property; Form 27Q –payments other than salary to non-residents). Below are the due dates for TDS Statements:

Quarter	Due date
Q1 (April to June)	31st July
Q2 (July to Sept)	31st October
Q3 (Oct to Dec)	31st January
Q4 (Jan to March)	31st May

• • Any delay in filing of TDS statements attracts fees of INR 200 per day of default (however, fees shall not exceed the number of TDS)
  • The penalty can also be levied which can be in the range of INR 10,000 to INR 1,00,000.
  • Issuance of TDS Certificates: It is the responsibility of every tax deductor to issue TDS certificates to the payee in the prescribed form. The frequency and time limit to issue different types of TDS certificates is given below:

Form	Nature of payment covered	Frequency	Due Date
Form 16	Salary payments	Annually	15th June of next F.Y.
Form 16A	All other payments	Quarterly	Q1 – 15th Aug Q2 – 15th Nov Q3 – 15th Feb Q4 – 15th June of next F.Y.
Form 16B	Immovable property purchase	Transaction dependent	Within 15 days of filing a TDS return for the same

• • If TDS certificates are not issued within the time limit, a penalty of INR 100 per day is levied.

Tax Collection at Source (TCS)

• In the case of TCS, the seller must collect an amount in addition to the sale value from the purchaser as tax and deposit the tax so collected with the government. Like TDS, there are specific transactions to which TCS provisions are applicable.
• Compliances attached to TCS and consequences of non-compliance:

(i) Monthly payment of TCS: Once a tax is collected, the collector(seller) needs to deposit the TCS to the government monthly. The due date for depositing the amount of tax collected is 7 days from the end of the month in which tax was required to be collected.

• • If tax was not collected, simple interest @ 1% p.m. or part of the month is levied starting from the date on which tax was collectible till the date of deposit of tax.

• • In case of failure to collect or failure to pay the tax collected, further legal consequences can be:
    • A penalty equal to the amount of tax not collected / not deposited can be levied.
    • Can also lead to prosecution leading to imprisonment ranging between 3 months to 7 years.

(iii) Quarterly TCS Statements: A person who is required to collect tax at source is required to file quarterly statements (returns) of TCS in Form 27D. Below are the due dates for TCS Statements:

Quarter	Due date
Q1 (April to June)	15th July
Q2 (July to Sept)	15th October
Q3 (Oct to Dec)	15th January
Q4 (Jan to March)	15th May of next F.Y.

• • Any delay in filing of TCS statements attracts fees of INR 200 per day of default (however, fees shall not exceed the amount of TCS)

• • A Penalty can also be levied which can be in the range of INR 10,000 to INR 1,00,000.

Computation of Total Income and Filing of Income – Tax Return

• Applicability: Every company registered in India must file an Income Tax return irrespective of any income, profit, or loss. Even the dormant companies with no transactions are required to file the return.
• The companies file their Income Tax Return in ITR-6.
• Due Date:
  • Companies to whom Transfer Pricing provisions apply (TP Report): 30th
  • Other Companies: 31st
• Consequences of non-compliance:
  • Fees levied for delay in filing ITR.
    • ROI filed till 31stDecember: INR 5,000.
    • ROI filed beyond 31st December: INR 10,000.
    • If Total Income < 5 Lakhs: INR 1,000 (irrespective of the date of filing return)

• Interest @ 1% p.m. or part thereof levied on amount of unpaid tax u/s. 234A (in addition to interest u/s. 234B)
• Certain losses of the past shall lapse and shall not be carried forward to next year.
• Ineligible to claim various deductions under chapter VI-A.
• Assessment proceedings, other penalties, and prosecution can be initiated based on the circumstances of the case.

Others

• Tax Audit u/s 44AB: If turnover exceeds a specified threshold amount (INR 1 crore / INR 5 crore depending on whether cash receipts/ cash payments are > 5% of total receipts/payments), a tax audit is applicable and an audit report from CA is mandatory. In case of non-compliance / delay in filing tax audit reports, a penalty of 5% of turnover (subject to maximum INR 1,50,000) is levied.
• Transfer Pricing: If transfer pricing provisions are applicable, a transfer pricing report from an accountant is required & specified documents/ information must be maintained. Failure to furnish transfer pricing reports attracts a penalty of INR 1,00,000. Failure to maintain appropriate documentation attracts a penalty of 2%of the value of international transactions.
• Report/ Certificate from CA may be required for claiming a few deductions/exemptions.
• A valuation report from CA or merchant bankers may be required in certain cases.

Compliances under Goods and Services Tax (GST) Act

Registration

• Voluntary Registration: Companies opt for voluntary registration, even though the turnover is below specified limits due to advantages like:
  • Claim input tax credit (ITC) of taxes paid on purchases/procurements and can utilize the same for payment of taxes due on supply of goods or services.
  • Most corporates prefer dealing with suppliers who are GST registered as it ensures seamless flow of ITC.
  • Banks and financial institutions lend working capital loans at lower rates as they are in a better position to determine cashflows based on GST returns data.
• Registration on crossing specified Turnover: There are three limits of turnover mentioned i.e., INR 10 lakhs, INR 20 Lakhs, and INR 40 Lakhs. The turnover limit applicable will depend upon the state of registration and whether the supply consists of goods only or services only or a combination of both.
• Compulsory Registration: Compulsory registration is required in certain cases such as inter-state suppliers, casual taxable persons, persons required to deduct TDS / collect TCS under GST, E-commerce operators, commission agents, etc.
• The penalty of 100% of the tax due or INR 10,000– whichever is higher, is levied in case of failure to register under GST.

GST Returns and Payment

• Return filing is mandatory under GST. Even if there is no transaction, you must file a NIL return. There are various returns to be filed on a monthly/quarterly/annual basis depending on the nature of the business.
• The common returns are:
  • GSTR -1 / IFF: for outward supplies of goods and services,
  • GSTR -3B: self-declaration of all outward supplies made, input tax credit claimed, tax liability ascertained, and taxes paid.
• Tax liability has to be paid before filing GSTR -3B.
• Consequences of non-compliance:
  • Cannot file a return if you do not file the previous month/quarter’s return. Hence, late filing of GST returns will have a cascading effect leading to heavy interest, fees, and penalties.
  • In case of delay in making payment of taxes due, interest @ 18% p.a. is levied.
  • Delay in filing GST Returns attracts a late filing fee of INR 50 per day (max INR 5000)

Others

• Determining HSN/SAC and charging appropriate GST rate on supplies
• Proper invoicing of outward supplies / obtaining LUT for exports.
• Maintenance of records for correctly claiming ITC (Reconciliation with GSTR -2A)
• Author may be Reached out through mail @cajpjain20@gmail.com

Disclaimer: This Article has been written by author for the sake of information purpose only. It can not construed as an  Legal Advice.