Taxation, Compliance and Advisory Services

Tax Deducted at Source (TDS) is a mechanism by which the payer deducts tax at the time of making specified payments such as salary, rent, professional fees, and interest. Any person (individual, company, or firm) making such payments above prescribed thresholds is required to deduct TDS, obtain a TAN, deposit the deducted tax with the government, and file quarterly TDS returns. Failure to deduct or deposit TDS attracts interest and penalties under the Income Tax Act.

Filing of Income Tax Returns is mandatory for individuals whose gross total income exceeds the basic exemption limit (₹4 lakh under the New (Default) Regime). Additionally, filing is mandatory in certain cases, including where you have foreign assets, are a beneficial owner of foreign accounts, have deposited more than ₹1 crore in bank accounts, or are seeking a refund. Even if income is below the threshold, voluntary filing is advisable for loan applications, visa purposes, and carrying forward losses.

GST registration is mandatory when aggregate annual turnover exceeds ₹40 lakhs for goods suppliers (₹20 lakhs in certain special category states) or ₹20 lakhs for service providers (₹10 lakhs in special category states). Registration is also compulsory for e-commerce operators and sellers, persons making inter-state taxable supplies of goods, persons liable to pay tax under reverse charge, and those required to deduct TDS under GST. Voluntary registration is permitted for businesses below these thresholds.

A Private Limited Company must mandatorily file: (1) AOC-4 - Financial Statements within 60 days of the AGM, (2) MGT-7A – Abridged Annual Return within 60 days of AGM, (3) ADT-1 – Appointment of Auditor and (4) MGT-14 for board resolutions on specific matters. Additionally, companies must hold at least 4 Board Meetings per year, maintain statutory registers, and comply with provisions of the Companies Act, 2013. Non-compliance attracts late fees and penalties.

Double Taxation Avoidance Agreement (DTAA) is a treaty between India and other countries to prevent the same income from being taxed twice, once in India and once in the country of residence. NRIs can avail DTAA benefits on income earned in India (such as interest, dividends, capital gains) by providing a Tax Residency Certificate (TRC) and Form 10F and any other documents as may be required. DTAA benefits include lower withholding tax rates and exemptions. The applicable DTAA depends on the country of residence of the non-resident. Professional guidance is essential to correctly apply DTAA provisions.

A Letter of Undertaking (LUT) under GST allows registered exporters to export goods or services without payment of Integrated GST (IGST). By furnishing an LUT, the exporter undertakes to realise export proceeds and fulfil export obligations. LUT must be filed annually on the GST portal before the start of each financial year. Without an LUT, exporters must pay IGST on exports and subsequently claim a refund, which affects cash flows. Exporters who have been prosecuted for tax evasion exceeding ₹2.5 crore are not eligible for LUT.