Digital Signature Certificate Delhi

A Digital Signature Certificate in Delhi plays a key role in safe online dealings, e-filing taxes, and signing papers. In today's digital scene, getting a DSC is vital for companies and experts alike. Protax Advisors offers you a full guide to make it easier to get a Digital Signature Certificate Delhi.

A Digital Signature Certificate is an electronic credential during online transactions. A DSC authenticates a person's or entity's identity during online transactions. It ensures data integrity and non-repudiation, making it indispensable in any form of secure communication and fulfilling of the legal framework.

Types of Digital Signature Certificates

1. Class 1 DSC

• Purpose: This helps in validating the user's name and email address.

• Usage: It is useful for all personal-related activities like email verification.

2. Class 2 DSC

• Purpose: This authenticates a user's identity through a trusted database.

• Usage: Class 2 e-filing of company returns, income tax return, legal documents, etc.

3. Class 3 DSC

• Purpose: Ensures high security for sensitive transactions.

• Usage: Compulsory where contracting involves electronic tendering, electronic auctions, and electronic bidding.

You can get any of the following Digital Signature Certificates in Delhi with Protax Advisors.

How to Get a Digital Signature Certificate Delhi: Clearly Explained in 5 Different Stages

1. Select your Certifying Authority (CA)

For obtaining the DSC in Delhi, you will have to choose the CA that is duly accredited by the CCA for issuing of the certificates. Examples of reliable CAs include:

• eMudhra

• NSDL e-Governance

• Sify Technologies

• CDAC

Visit the CA’s official website to begin your application process.

2. Gather Required Documents

Before applying for the Digital Signature Certificate Delhi, a person must have the following documents:

• ID Proof and Address Proof: Aadhaar card, passport, voter ID, driving license, utility bill, rent agreement, or bank statement.

• Photograph: Recent passport-sized photo.

• Company documents: For Corporate DSCs, Certificate of Incorporation, PAN Card and Authorisation letter.

3. Apply for a Digital Signature Certificate

Online Application

1. Fill Application Form: Access the CA’s website and complete the form.

2. Upload Documents: Attach scanned copies of required documents.

3. Make Payment: Pay the applicable fee online.

Offline Application

1. Download Form: Get the DSC application form from the CA’s website.

2. Complete Form: Fill in all necessary details and attach documents.

3. Submit Form: Deliver the completed form and documents to the CA’s office.

4. Verification Process

The CA will verify your identity and documents. Depending on the CA’s procedure, this step may involve physical verification or a video call. Once verified, the CA will proceed with generating your Digital Signature Certificate.

5. Generate and Receive DSC

After successful verification:

• Generate DSC: The CA will create your DSC.

• Delivery: The DSC will be issued either as a file for download or as a USB token.

Installation and Usage of Digital Signature Certificate Delhi

Installation

1. Install on Computer: Follow the CA’s instructions to install the DSC on your system.

2. Configuration: Configure the certificate in browsers or applications as required.

Usage

• Document Signing: Sign electronic documents securely.

• E-Filing: File income tax returns, GST forms, and other regulatory filings.

• E-Tendering: Participate in e-tenders and auctions.

Renewal of Digital Signature Certificate

DSCs typically have a validity of one or two years. To ensure uninterrupted use:

1. Apply for renewal before the expiry date.

2. Renewal Process of CA may require resubmission of papers.

Why A Digital Signature Certificate Is Important In Delhi

1. Regulatory Compliance

An Digital Signature Certificate Delhi is requirment for each and every company and for each and every professional who are involved in e filing and e tendering.  The personal interpretation of the identified norms also serves the purpose of checking compliance with the legal provisions.

2. Security and Authenticity

DSCs provide robust encryption, ensuring secure transactions and protecting sensitive information.

3. Convenience in E-Filing

With a DSC, businesses can streamline processes such as income tax filing, GST filing, and MCA compliance.

Why Choose Digital Signature Certificate Delhi?

Delhi, being a place of business and professionals, offers streamlined services for getting the DSCs issued. With many certified authorities and service providers, obtaining a Digital Signature Certificate Delhi is without a hassle.

Acquiring a Digital Signature Certificate Delhi can be easily accomplished as it adheres to secure online transactions and the regulations of the country. Therefore, if anyone is interested in getting a DSC with all the features required, they can follow the above steps and advice from Protax Advisors.

Employees' State Insurance

Employees' State Insurance (ESI) is a social security and health insurance scheme for Indian workers, managed by the Employees' State Insurance Corporation (ESIC). ESI registration is mandatory for certain categories of employers and employees. Here’s a step-by-step guide to registering for ESI in India:

Determine Eligibility

• Who Needs ESI:

• Employers: Entities with 10 or more employees (20 or more in certain states) and whose employees earn below a specified wage threshold.

• Employees: Those working in registered establishments and earning up to ₹21,000 per month (or ₹25,000 for employees with disabilities).

Gather Required Documents

• For Employers:

• Company Registration Details: Certificate of Incorporation, Partnership Deed, or other relevant documents.

• PAN Card: PAN of the company or business.

• Address Proof: Utility bill, rent agreement, or property documents.

• Bank Account Details: Bank statement or passbook.

• Employee Details: List of employees, including their details and salaries.

• For Employees:

• Identity Proof: Aadhaar card, voter ID, or passport.

• Address Proof: Utility bill, bank statement, or rent agreement.

Register Online

• Visit ESIC Portal: Go to the ESIC Online Registration portal.

• Create an Account: If you don’t already have an account, create one by providing basic details and registering with the portal.

• Login and Apply:

• Fill Registration Form: Complete the online ESI registration form by providing details about the company, employees, and contact information.

• Upload Documents: Upload scanned copies of the required documents.

• Submit Form: Review and submit the form online.

Physical Registration (if needed)

• Visit ESIC Office: In some cases, you may need to visit the nearest ESIC office with the completed form and documents.

• Submit Application: Submit the physical application form and documents at the ESIC regional office or branch office.

Verification Process

• Review: ESIC will review your application and documents. This may include a physical inspection of your establishment.

• Clarifications: If additional information or clarifications are needed, ESIC will contact you.

Receive ESI Registration Number

• Acknowledgment: After successful verification, you will receive an ESI Registration Number.

• ESI Code: This unique code is used for all future transactions with ESIC.

Compliance

• ESI Contribution: Begin deducting and depositing ESI contributions from employees' salaries as per the prescribed rates. The employer contributes 3.25% and the employee contributes 0.75% of the employee's wages.

• File Returns: Submit monthly or quarterly ESI returns online through the ESIC portal.

Maintain Records

• Employee Records: Maintain records of employee contributions, claims, and other related documents.

• Regular Updates: Update employee details and changes in the establishment as required.

Claim Benefits

• Employees: Employees can claim benefits such as medical care, maternity benefits, and disability benefits through the ESIC portal or local ESIC office.

Documents Required for ESI Registration:

1. Company Registration Details (Certificate of Incorporation, Partnership Deed).

2. PAN Card of the company.

3. Address Proof of the business.

4. Bank Account Details.

5. Employee Details.

Protax Advisors view:

ESI registration is crucial for businesses to comply with labor laws and provide social security benefits to employees. The process is streamlined with online options, making it accessible and efficient. Ensuring timely and accurate contributions is essential for compliance and to avoid penalties. For new businesses or those unfamiliar with the ESI process, consulting with an HR or legal expert can help navigate the registration and compliance requirements smoothly.

Goods and Service Tax GST in India - A comprehensive Guide

What Is the Goods and Services Tax (GST)?

GST is known for Goods and services tax in India. It is a value-added tax (VAT) levied on most goods and services sold for domestic consumption. The GST is paid by end consumers of goods and services and is collected by businesses who is selling those goods and services. Liability of payment of GST to government lies with businesses and it is also called destination based taxation.

GST and Service Tax in India- A Taxation reform

GST in India is an indirect tax which has replaced many indirect taxes of earlier tax regime in India such as the excise duty, VAT, services tax, etc. The Goods and Service Tax Act was passed in the Parliament on 29th March 2017 and came into effect on 1st July 2017.

Under the GST regime, the tax is levied at every point of sale.

-               In case of intra-state sales, which is transfer of goods from one state to another state, Central GST is charged.

-              In case of interstate, which is transfer of goods within states from one place to another place, State GST is charged.

-               All the inter-state sales are chargeable to the Integrated GST which goes to central government directly.

Central Goods and Services Tax (CGST)

CGST applies to the goods and services considered to be standard, with the revenue collected allocated to the central government. According to the Central Goods and Services Tax Act 2016, this part of the GST includes most of the central taxations such as Central Excise Duty, Central Sales Tax, Service Tax, and Additional Custom Duty.

State Goods and Services Tax (SGST)

SGST comprises taxation and levies under the state authority as a part of one uniform taxation structure. It includes State Sales Tax, Entertainment Tax, Luxury Tax, and Levies on Lottery. The revenue from these taxes are collected by state government.

Integrated Goods and Services Tax (IGST)

IGST is applicable to the goods and services transferred from one state to another state. According to Article 269A of the Indian Constitution, IGST is for the inter-state trade and commercial activities. The revenue from these taxes goes to the Central Government.

A business registered under the GST law has to include the GST amounts charged on the value items supplied in its invoices. The GST rates in CGST and SGST are nearly the same, while IGST is approximately the sum of CGST and SGST rates.

Tax Laws before GST

In the earlier indirect tax regime, there were many indirect taxes levied by both the state and the central Government. Every state had a different set of rules and regulations.

Inter-state sale of goods was taxed by the centre. CST (Central State Tax) was applicable in case of inter-state sale of goods. The indirect taxes such as the entertainment tax, octroi and local tax were levied together by state and centre. These led to a lot of overlapping of taxes levied by both the state and the centre.

For example, when goods were manufactured and sold, excise duty was charged by the centre. Over and above the excise duty, VAT was also charged by the state. It led to a tax on tax effect, also known as the cascading effect of taxes.

The following table list down the taxes in pre-GST regime:

Goods and Services Tax India- A Multi Stage Taxation structure

An item goes through multiple change-of-hands along its supply chain: Starting from manufacture until the final sale to the consumer.

Let us consider the following stages:

• Purchase of raw materials
• Production or manufacture
• Warehousing of finished goods
• Selling to wholesalers
• Transfer of goods from one place to another
• Sale of the product to the retailers
• Selling to the end consumers

The Goods and Services Tax is levied on each of these stages making it a multi-stage tax however tax is levied each stage on value addition and therefore making it value added tax.

GST in India also called destination based tax structure since tax is paid to that state where goods and services is finally consumed. For example goods manufactured in Delhi and sold to the final consumer in Uttar Pradesh, GST will be levied at the point of consumption and the entire tax revenue will go to Uttar Pradesh government and not to Delhi government.

Objectives Of GST

To achieve the ideology of ‘One Nation, One Tax’

GST has replaced multiple indirect taxes which were existed under the previous tax regime. The advantage of having one single tax means every state follows the same rate for a particular product or service.

To eliminate the cascading effect of taxes

Due to different indirect tax laws in previous tax regine, taxpayers could not set off the tax credits of one tax against the other. For example, the excise duties paid during manufacture could not be set off against the VAT payable during the sale. Under GST, the tax levy is only on the net value added at each stage of the supply chain. This has helped eliminate the cascading effect of taxes and contributed to the seamless flow of input tax credits across both goods and services.

To curb tax evasion

GST laws in India are far more stringent compared to any of the erstwhile indirect tax laws. GST being a nationwide tax and having a centralised surveillance system, the clampdown on defaulters is quicker and far more efficient. Hence, GST has curbed tax evasion and minimised tax fraud from taking place to a large extent.

To increase the taxpayer base

GST has helped in widening the tax base in India. Previously, each of the tax laws had a different threshold limit for registration based on turnover. As GST is a consolidated tax levied on both goods and services both, it has increased tax-registered businesses.

Online procedures for ease of doing business

GST procedures are carried out almost entirely online as every step is done with a click of a button, from registration to return filing to refunds to e-way bill generation. It has contributed to the overall ease of doing business in India and simplified taxpayer compliance to a massive extent.

An improved logistics and distribution system

A single indirect tax system reduces the need for multiple documentation for the supply of goods. GST minimises transportation cycle times, improves supply chain and turnaround time, and leads to warehouse consolidation, among other benefits.

To promote competitive pricing and increase consumption

Having uniform GST rates have contributed to overall competitive pricing across India and on the global front due to removal of multiple taxation under old tax structure. This has hence increased consumption and led to higher revenues, which has been another important objective achieved.

Advantages of GST

GST has mainly removed the cascading effect which is also called double taxation on the sale of goods and services. Removal of the cascading effect has impacted the cost of good which has decreased cost of goods and services significantly.

Also, GST is mainly technologically driven. All the activities like registration, return filing, application for refund and response to notice needs to be done online on the GST portal, which accelerates the processes.

• Ease of Doing Business: Simplified tax compliance and a unified tax system have made it easier for businesses to operate across different states, promoting ease of doing business in India.
• Reduction in Cascading Effect: By subsuming various indirect taxes into a single tax, GST has eliminated the cascading effect of taxes, reducing the overall tax burden on goods and services.
• Increased Tax Revenue: The GST regime has widened the tax base and improved tax compliance, leading to increased tax revenue for both central and state governments.
• Economic Integration: GST has facilitated the creation of a common national market by removing inter-state trade transaction barriers, thereby promoting economic integration and growth.
• Consumer Benefits: The reduction in the overall tax burden has led to lower prices for many goods and services, benefiting consumers through increased purchasing power.

GST Rates Slabs 2024 for Goods

GST Rates Slabs 2024 for Services

Exemptions from GST

Besides the good and services taxed on the aforementioned rates under the GST Act, there are some exemptions from GST. Here are the lists of goods and services exempted from GST.

List of Exempted Services

New Compliances under GST

E-Invoicing in GST

E-invoicing, or electronic invoicing, in GST, is a system where B2B invoices are electronically authenticated by the Goods and Services Tax Network (GSTN) for use on the common GST portal. This system aims to standardise the invoicing process, reduce errors, and streamline the flow of input tax credits. The key features of E-Invoicing include:

• Standardization: A uniform invoice format across businesses.
• Automation: Real-time reporting and reduced manual intervention.
• Compliance: Ensures compliance with GST regulations and reduces the risk of tax evasion.

E-Invoicing Applicability & Turnover Limit

E-invoicing is applicable to businesses based on their annual turnover. The applicability and turnover limits are as follows:

• Turnover Limit: Initially, e-invoicing was mandated for businesses with a turnover exceeding ₹500 crores. Over time, this limit was reduced to ₹50 crores. As of 2024, businesses with an annual turnover of ₹5 crores and above are required to generate e-invoices.
• Exemptions: Certain entities such as SEZ units, insurers, banks, financial institutions, and NBFCs are exempt from e-invoicing requirements.

E-Way Bill

GST introduced a centralised system of waybills by the introduction of “E-way bills”. This system was launched on 1st April 2018 for inter-state movement of goods and on 15th April 2018 for intra-state movement of goods in a staggered manner.

Under the e-way bill system, manufacturers, traders and transporters can generate e-way bills for the goods transported from the place of its origin to its destination on a common portal with ease. Tax authorities are also benefited as this system has reduced time at check -posts and helps reduce tax evasion.

The E-Way Bill is an electronic document required for the movement of goods valued above ₹50,000. It is generated on the GST portal and contains details of the goods, their consignor, consignee, and the transporter. Key points about this Bill system include:

• Purpose: To track the movement of goods and ensure compliance with GST laws.

• Components: Details of the supplier, recipient, goods, and transporter.

• Validity: The validity of the E-Way Bill depends on the distance the goods need to be transported. For instance, it is valid for one day for a distance of up to 100 km.

GST Audit

A GST audit is an examination of records, returns, and other documents maintained by a taxpayer to verify the correctness of turnover declared, taxes paid, refund claimed, and input tax credit availed. The key aspects of a GST audit include:

Applicability: Applicable to businesses with an annual turnover exceeding ₹5 crores.

Turnover-Based Audit: Conducted by a Chartered Accountant or a Cost Accountant.

Special Audit: Directed by the GST authorities based on discrepancies.

Departmental Audit: Conducted by the tax authorities.

Reverse Charge Mechanism in GST

The Reverse Charge Mechanism (RCM) in GST is a system where the recipient of goods or services is liable to pay the GST instead of the supplier. This mechanism is applicable in specific cases as notified by the government. Key points about RCM include:

Applicability

• Specified Goods and Services: Certain goods and services are notified under RCM.

• Unregistered Supplier: When a registered dealer procures goods or services from an unregistered supplier.

• Compliance: The recipient must issue a payment voucher and a tax invoice for the goods or services received under RCM.

• Input Tax Credit: The recipient can claim input tax credit on the GST paid under RCM, subject to normal input tax credit rules.

These elements of the GST system ensure a streamlined, transparent, and efficient tax compliance process for businesses in India.

Input Tax Credit (ITC)

Input Tax Credit (ITC) is a fundamental feature of the Goods and Services Tax (GST) system, allowing businesses to reduce their tax liability by claiming credit for the GST paid on purchases. This mechanism prevents the cascading effect of taxes/double taxation and ensures that tax is paid only on the value addition at each stage of the supply chain.

Eligibility: Registered businesses can claim ITC for GST paid on goods and services used for business purposes

Conditions:

• The recipient must possess a valid tax invoice
• Goods or services must be received
• Tax must have actually been paid to the government
• Returns must be filed correctly and timely

Exclusions: ITC cannot be claimed for personal use, exempt supplies, or goods/services specified in the blocked credit list.

Output Tax under GST

Output Tax under GST refers to the tax that a registered business is required to collect from customers on the supply of goods or services. It is calculated based on the applicable GST rates on the value of the goods or services supplied

Calculation: Output tax under GST is calculated by applying the GST rate to the transaction value of the supply.

Payment: Output tax collected must be paid to the government by filing monthly or quarterly GST returns.

Adjustment: Businesses can adjust their output tax liability by claiming ITC for the GST paid on their purchases.

GSTIN

The Goods and Services Tax Identification Number (GSTIN) is a unique 15-digit identification number assigned to every registered taxpayer under the GST regime. It is used for all GST-related activities, including filing returns, claiming ITC, and paying taxes.

Structure:

• The first two digits represent the state code.

• The next ten digits are the PAN of the taxpayer.

• The 13th digit is based on the number of registrations within a state.

• The 14th digit is Z by default.

• The 15th digit is a check code.

Importance:

• GSTIN is mandatory for businesses with an annual turnover exceeding ₹40 lakhs (₹20 lakhs for special category states).

• It is required for issuing tax invoices, filing GST returns, and availing ITC.

• It ensures compliance with GST laws and facilitates the seamless movement of goods across states.

These components—Input Tax Credit (ITC), Output Tax, and GSTIN—are crucial for businesses to understand and manage their GST obligations effectively.

GST Council : The GST Council is a constitutional body responsible for making recommendations on issues related to GST, including rates, exemptions, and administrative policies. Key features of the GST Council include:

Composition: Chaired by the Union Finance Minister and includes the Finance Ministers of all states and union territories.

Functions: Determines GST rates for goods and services, drafts rules and regulations, and resolves issues related to GST implementation.

Decision-Making: Operates on the principle of consensus, with each member having one vote irrespective of the size of their state's economy.

Meetings: Meets regularly to discuss and decide on GST-related matters, ensuring cooperative federalism and uniformity in tax policies across states.

GST Registration and Process

GST registration is mandatory for businesses engaged in the supply of goods or services with an annual turnover exceeding ₹40 lakhs (₹20 lakhs for special category states). The registration process includes:

• Application: Businesses apply for GST registration online through the GST portal by submitting required documents such as PAN, Aadhaar, business address proof, and bank account details.

• Verification: The application is verified by the GST authorities, and a GSTIN (Goods and Services Tax Identification Number) is issued upon approval.
• Filing Returns: Registered businesses must file monthly or quarterly GST returns depending on their turnover, detailing their sales, purchases, and tax liability.
• Compliance: GST registrants must comply with GST rules and regulations, issue tax invoices, collect GST from customers, and maintain proper records of transactions.

GST Registration FAQs

What is an E-way Bill?

An E-way Bill is a document required for the movement of goods worth over a specified value between different states. It ensures tax compliance and facilitates the smooth transportation of goods by providing details about the consignment.

What is the HSN Code?

The HSN Code, or Harmonised System of Nomenclature, is a standardised coding system for classifying goods internationally. It simplifies the identification of products for tax and regulatory purposes, aiding in smooth trade.

Can a salaried person apply for GST?

 Yes, a salaried person can apply for GST registration if involved in business activities beyond their employment. Registering is mandatory if the aggregate turnover exceeds 40 Lakh per annum for goods and 20 Lakhs per annum for services.

What is the full form of SAC Code?

The full form of SAC Code is ‘Service Accounting Code.’ It is a system of classification for services under GST, helping in uniform taxation and simplifying compliance for service providers.

How to handle GST compliance if my GSTIN was cancelled and I didn’t file the final return?

If your GSTIN was cancelled without filing the final return, rectify by filing the pending return immediately. Failure to do so can lead to penalties and compliance issues.

What is the GST Annual Return?

The GST Annual Return is a summary of a taxpayer's financial activities for a fiscal year, including details of sales, purchases, and taxes paid. It provides a comprehensive overview of the taxpayer's GST transactions.

Can I avail input tax credit against a 5% GST liability for goods sold by my LLP?

No, input tax credit cannot be availed against a 5% GST liability for goods sold by your LLP. Input tax credit is typically applicable for higher tax rates, and the limited 5% tax rate may not provide eligibility for claiming input tax credit in this scenario.

What should a business do about GST when not registered and dealing with GST-charging entities?

If not registered for GST and dealing with GST-charging entities, consider registering to avail input tax credits. Without registration, businesses might bear the entire tax burden, impacting profitability.

How to resolve error code SB001 in GST export through ICEGATE?

Resolve GST export error code SB001 on ICEGATE by verifying data accuracy, ensuring proper document submission, and seeking assistance from ICEGATE or GST support for technical guidance

How to deal with negative amount errors in GSTR3B due to credit notes?

To address negative amount errors in GSTR3B due to credit notes, rectify the values, report corrections in subsequent returns, and maintain accurate documentation to reconcile discrepancies

What is the difference between the effective date of GST registration and the date of GST registration?

 The effective date of GST registration is when you become liable to pay GST, while the date of registration is when you are officially registered. Understanding this difference is important for determining when your GST obligations commence.

Is issuing a tax invoice and tax collection mandatory for voluntary GST registration?

 Yes, issuing a tax invoice and tax collection is mandatory for voluntary GST registration. Even if your turnover is below the threshold, compliance with invoicing and collection requirements is necessary to meet legal obligations and maintain transparency in your transactions.

What is cess in GST?

Penalties for not registering for GST on time include late fees and interest charges. It's crucial to adhere to registration deadlines to avoid financial implications and ensure compliance with tax regulations.

What is GST act and rules?

GST is primarily governed by the following 4 acts:

1. Central Goods and Services Tax Act, 2017 (CGST)
2. Integrated Goods and Services Tax Act, 2017 (IGST)
3. State Goods and Services Tax Act, 2017 (SGST)
4. Union Territory Goods and Services Tax Act, 2017 (UTGST)

Additionally there are rules framed covering various aspects of GST, which helps in smooth implementation and enactment of the act.

How is GST calculated?

The GST rates shall be multiplied by the assessable value of the supply to arrive at the GST amounts in a tax invoice.

How many GST slabs are there in India?

The primary GST slabs for any regular taxpayers are presently pegged at 0% (nil-rated), 5%, 12%, 18% & 28%. There are a few lesser-used GST rates such as 3% and 0.25%.

What is the GST rate in India?

GST rates refer to the percentage rates of tax imposed on the sale of goods or services under the CGST, SGST and IGST Acts. A business registered under the GST law must issue invoices with GST amounts charged on the value of supply.

The GST rates in CGST and SGST (For intrastate transactions) are approximately the same. Whereas, the GST rate in the case of IGST (For interstate transactions) is approximately the sum total of CGST and SGST rate.

What is GST number and how to check it?

GST number or GST Identification number, popularly known as GSTN is a 15-digit PAN-based unique identification number allotted to every registered person under GST. One can check GSTN by visiting the GST portal at www.gst.gov.in, and entering the same in the "Search Taxpayer" option 

What does GST means?

GST stands for Goods and Services Tax. The Act governing the same came into effect on 1st July 2017.

How Is GST Calculated?

The goods and services tax (GST) is computed by simply multiplying the price of a good or service by the GST tax rate. For instance, if the GST is 5%, a $1.00 candy bar would cost $1.05.

Who Has to Pay GST?

In general, goods and services tax (GST) is paid by the consumers or buyers of goods or services. Some products, such as from the agricultural or healthcare sectors, may be exempt from GST depending on the jurisdiction.

Are VAT and GST the Same?

Value-added tax (VAT) and goods and services tax (GST) are similar taxes that are levied on the sale of goods and services. Both VAT and GST are also indirect taxes, which means that they are collected by businesses and then passed on to the government as part of the price of the goods or services.

However, there are some key differences between the two. VAT is primarily used in European countries and is collected at each stage of the production and distribution process, while GST is used in countries around the world and is collected only at the final point of sale to the consumer. VAT is generally applied to a wider range of goods and services than GST, and the rates of VAT and GST can vary depending on the type of goods or services being sold and the country in which they are sold.

Which services cost nil GST tax?

Nil GST tax is applicable to services offered on Basic Savings Bank Deposit (BSBD) opened under the Pradhan Mantri Jan Dhan Yojana (PMJDY). Additionally, some services and goods counted under the most basic needs cost nil GST tax.

What are HSN wise GST rates?

Harmonized System of Nomenclature code (HSN Code) is a system of coding used to classify goods under GST in India. The codes are issued by the World Customs Organization (WCO) and help with the classification of commodities that belong to the same nature under different chapters, sections, headings, and sub-headings.

Hindu Undivided Family

Hindu Undivided Family (HUF) is a special type of legal entity under Indian law, primarily used for family and ancestral wealth management. It provides certain tax benefits and is often utilized for estate planning and succession purposes. Here’s a step-by-step guide to registering an HUF in India:

Understanding HUF

• Definition: An HUF is a family entity consisting of all persons lineally descended from a common ancestor and includes their wives and unmarried daughters. It is a distinct entity from the individual members for tax purposes.

• Structure: Managed by a Karta (head of the family) and other coparceners (members who have a right to the ancestral property).

Formation of HUF

• Step 1: Formation: An HUF can be formed automatically by virtue of Hindu law, which recognizes it as a separate legal entity. It doesn't require formal registration but should be created by:

• Creation of a Deed: Draft a HUF deed that outlines the family members, the Karta, and the properties/assets to be included in the HUF.

• Contribution: Initial contribution of assets or funds into the HUF’s account from its members.

Obtain PAN Card for HUF

• Step 2: Apply for a Permanent Account Number (PAN) for the HUF, which is essential for tax purposes and conducting financial transactions.

• Process:

• Documents Required:

• HUF Deed or Declaration.

• Identity Proof and Address Proof of Karta (e.g., Aadhaar card, passport).

• Proof of Address of the HUF (e.g., utility bill, lease agreement).

• Photographs of Karta.

• Application: Fill out Form 49A for PAN application, indicating that it’s for an HUF.

• Submission: Submit the application online through the NSDL or UTIITSL website, or physically at a PAN application center.

Open a Bank Account for HUF

• Step 3: Open a bank account in the name of the HUF. The account should be opened in the name of the HUF with the Karta operating the account.

• Documents Required:

• PAN Card of the HUF.

• HUF Deed or Declaration.

• Identity Proof and Address Proof of Karta.

• Proof of Address of the HUF.

• Resolution: A resolution signed by the Karta authorizing the opening of the account.

Register the HUF for Tax Purposes

• Step 4: Although HUFs are recognized under the Income Tax Act and do not need separate registration, ensure that the HUF is compliant with tax laws:

• Filing of Returns: File income tax returns for the HUF, separate from individual tax returns.

• Tax Registration: If applicable, ensure the HUF is registered for GST if it is engaged in business activities.

Maintain Records and Compliance

• Step 5: Maintain proper books of accounts and records of all transactions, assets, and income. Ensure compliance with applicable tax laws and regulations.

Change in Structure

• Step 6: If there are changes in the family structure (e.g., new members, changes in the Karta), update the records and bank details accordingly.

Documents Required for HUF Formation:

1. HUF Deed or Declaration.

2. PAN Card application form (Form 49A).

3. Identity Proof and Address Proof of Karta.

4. Proof of Address of the HUF.

5. Bank Account Opening Documents. 

Protax Advisors view:

HUF registration and formation is relatively straightforward, involving a family deed and obtaining a PAN. It provides useful tax benefits and helps in managing ancestral assets efficiently. However, maintaining compliance with tax regulations and proper record-keeping is crucial. HUFs can be beneficial for managing family wealth and ensuring smooth succession, but it’s advisable to consult a legal or financial advisor to understand the implications and optimize benefits based on specific family needs and circumstances.

International Organization for Standardization

ISO (International Organization for Standardization) certification is a globally recognized standard that ensures the quality, safety, and efficiency of products, services, and systems. In India, ISO certification can be achieved through a structured process involving several key steps. Here’s a guide to the ISO certification process in India:

Determine the Relevant ISO Standard

• Identify the Standard: Determine which ISO standard applies to your business needs. Some common ISO standards include:

• ISO 9001: Quality Management System

• ISO 14001: Environmental Management System

• ISO 45001: Occupational Health and Safety Management System

• ISO 22000: Food Safety Management System

• Understand Requirements: Review the requirements of the relevant standard and ensure they align with your business objectives.

Pre-Certification Assessment (Optional)

• Conduct a Gap Analysis: Before formal certification, perform an internal audit or hire a consultant to identify gaps between your current practices and the ISO standard requirements.

• Improve Processes: Address identified gaps and make necessary improvements to meet the standard’s requirements.

Prepare Documentation

• Develop Documentation: Create and maintain documentation required by the ISO standard, including:

• Quality Manual: Describes the scope of the management system and how it meets the ISO requirements.

• Procedures and Policies: Documented procedures for critical processes.

• Records: Records of processes, audits, and other relevant activities.

• Implement Processes: Ensure that the documented processes are implemented and followed consistently.

Choose a Certification Body

• Select an Accredited Body: Choose a recognized certification body accredited by a national or international accreditation organization, such as:

• National Accreditation Board for Certification Bodies (NABCB) in India.

• International Accreditation Forum (IAF).

• Request Proposals: Contact several certification bodies to understand their services, costs, and timelines.

Apply for Certification

• Submit Application: Apply for certification with the chosen certification body. Provide all necessary documentation and information about your organization and its processes.

• Initial Review: The certification body will review your application and documentation to ensure completeness.

Stage 1 Audit (Document Review)

• Audit Preparation: The certification body will conduct a preliminary audit to review your documentation and readiness for the full audit.

• Review Findings: Address any issues or non-conformities identified during the Stage 1 audit before proceeding to Stage 2.

Stage 2 Audit (Certification Audit)

• On-Site Audit: The certification body will conduct an on-site audit to assess your implementation and effectiveness of the management system in practice.

• Audit Report: The auditor will prepare a report detailing findings, including any non-conformities or areas for improvement.

• Corrective Actions: If any non-conformities are found, implement corrective actions and provide evidence of resolution to the certification body.

Certification Decision

• Review by Certification Body: The certification body will review the audit findings and corrective actions.

• Issuance of Certificate: If all requirements are met, the certification body will issue an ISO certificate valid for a specified period (typically 3 years).

Surveillance Audits

• Ongoing Compliance: The certification body will conduct periodic surveillance audits (usually annually) to ensure continued compliance with the ISO standard.

• Address Findings: Implement any corrective actions required based on surveillance audit findings.

Recertification

• Renew Certification: Before the certificate expires, undergo a recertification audit to renew the ISO certification for another cycle.

Documents Required for ISO Certification:

1. Application Form for certification.

2. ISO Standard Documentation: Quality manual, procedures, and policies.

3. Proof of Implementation: Records of processes and audits.

4. Organizational Information: Details about your business, structure, and processes.

5. Internal Audit Reports (if available).

Protax Advisor view:

ISO certification is a valuable asset for organizations seeking to demonstrate their commitment to quality, efficiency, and compliance with international standards. The process can be rigorous, but it provides significant benefits, including improved processes, customer satisfaction, and competitive advantage. It's crucial to thoroughly prepare and address any gaps before the certification audit to ensure a smooth process. Engaging with a consultant or expert can be beneficial, especially for businesses new to ISO standards.

Limited Liability Partnership

Incorporating a Limited Liability Partnership (LLP) in India involves a streamlined process governed by the Limited Liability Partnership Act, 2008. Below are the steps to incorporate an LLP:

Obtain Digital Signature Certificate (DSC)

• Step: All designated partners of the LLP must obtain a Digital Signature Certificate (DSC), as the forms and documents required for registration are submitted online.

• Why: The DSC is used to sign electronic documents for the LLP registration process.

Apply for Director Identification Number (DIN/DPIN)

• Step: Each designated partner needs to obtain a Designated Partner Identification Number (DPIN) or Director Identification Number (DIN). If they don’t already have one, they can apply for it via Form DIR-3 or directly through the FiLLiP form during the incorporation process.

Name Reservation (RUN-LLP)

• Step: Choose a unique name for the LLP and apply for name reservation using the Reserve Unique Name for LLP (RUN-LLP) service on the MCA portal. The name should not conflict with any existing LLP, company, or trademark.

• Note: Two name options can be proposed, and approval is granted if the name complies with the LLP Name Guidelines.

Draft the LLP Agreement

• Step: Prepare an LLP Agreement, which outlines the rights, duties, and responsibilities of all partners. It should also specify the profit-sharing ratio and rules for running the LLP.

• Why: The LLP agreement is the governing document that defines the structure and operational guidelines of the LLP.

• Filing: The agreement must be filed with the MCA within 30 days of incorporation.

Filing the Incorporation Form (FiLLiP)

• Step: File the FiLLiP (Form for Incorporation of LLP) online on the MCA portal. This form is an integrated form used for:

• Incorporation details (name, business, registered office address).

• Partner and designated partner details.

• DPIN/DIN application (if applicable).

• PAN & TAN application (for tax registration).

• Documents Required: The following documents must be attached:

• Proof of registered office address (e.g., utility bills, NOC from property owner).

• Subscriber’s sheet signed by the partners.

• Identity and address proof of partners.

• Payment of Fees: The appropriate government fees must be paid based on the contribution of the partners.

Certificate of Incorporation (COI)

• Step: Once the FiLLiP form is approved by the Registrar of Companies (RoC), the Certificate of Incorporation (COI) is issued. The COI includes the LLP’s LLPIN (Limited Liability Partnership Identification Number).

• Time Frame: Typically takes 5–7 working days after submission, depending on processing time.

PAN & TAN Allotment

• Step: Along with the COI, the LLP will be automatically allotted a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN).

Filing LLP Agreement (Form 3)

• Step: After incorporation, the LLP Agreement must be filed within 30 days using Form 3 on the MCA portal. The agreement defines the partnership's internal regulations, profit-sharing ratio, and roles of partners.

Opening a Bank Account

• Step: With the COI, PAN, and LLP Agreement, the LLP can open a bank account for conducting business.

Post-Incorporation Compliances

• GST Registration (if applicable for business activities).

• Professional Tax Registration (if applicable in the state).

• Filing Annual Returns and Financial Statements as required by the LLP Act.

Documents Required for LLP Incorporation:

• Identity Proof of Partners: PAN, Aadhaar, Passport, etc.

• Address Proof of Partners: Passport, Voter ID, Driver's License, etc.

• Proof of Registered Office Address: Utility bill (not older than 2 months), NOC from the property owner.

• LLP Agreement: Signed by all partners.

Protax Advisors view:

Incorporating an LLP in India provides flexibility with the added advantage of limited liability and less regulatory compliance compared to a Private Limited Company. The LLP structure is particularly ideal for professional services firms (like legal, consultancy, or accounting businesses) or small and medium businesses that want partnership flexibility without exposing partners’ personal assets. The online process via the MCA portal has simplified registration, making it an efficient option for businesses seeking a formalized, legal entity.

MSME Registration

Micro, Small, and Medium Enterprises (MSMEs) in India are categorized based on their investment in plant and machinery (for manufacturing enterprises) or equipment (for service enterprises) and annual turnover. MSME registration provides various benefits, including access to credit, subsidies, and incentives under government schemes. Here’s a step-by-step guide to registering an MSME in India:

Determine Eligibility

• Definition of MSME: MSME classification is based on investment and turnover limits:

• Micro Enterprise: Investment up to ₹1 crore and turnover up to ₹5 crore.

• Small Enterprise: Investment up to ₹10 crore and turnover up to ₹50 crore.

• Medium Enterprise: Investment up to ₹50 crore and turnover up to ₹250 crore.

• Criteria: Ensure your business falls within these limits for eligibility.

Gather Required Documents

• Documents Required:

• PAN Card of the business.

• Aadhaar Card of the owner.

• Business Address Proof (e.g., utility bill, lease agreement).

• Bank Account Statement.

• Business Registration Certificate (e.g., Certificate of Incorporation for companies, Partnership Deed for partnerships).

• Proof of Investment in plant and machinery or equipment.

• Financial Statements (if available).

Register on the UDYAM Portal

• Step 1: Visit the official UDYAM Registration Portal (https://udyamregistration.gov.in).

• Step 2: Click on “For New Entrepreneurs who are not Registered yet as MSME”.

Fill Out the Application Form

• Step 1: Complete the online application form by providing the following details:

• Aadhaar Number of the business owner.

• PAN Number of the business.

• Business Details: Name, type of enterprise (micro, small, medium), and address.

• Bank Account Details: Account number and IFSC code.

• Investment and Turnover: Details of investment in plant and machinery or equipment and annual turnover.

• Nature of Business: Description of the business and products/services.

Verify and Submit

• Step 1: Review the information provided in the application form to ensure accuracy.

• Step 2: Submit the application electronically on the UDYAM portal.

Receive UDYAM Registration Number

• Step 1: After submission, you will receive an Acknowledgment Number or Registration Number on the portal.

• Step 2: An UDYAM Registration Certificate will be generated once the application is processed and verified. This certificate can be downloaded from the portal.

Verification (if required)

• Step 1: The MSME registration may be subject to verification by authorities if needed.

• Step 2: If required, provide any additional information or documents requested by the authorities.

Utilize MSME Benefits

• Step 1: Once registered, your enterprise can avail various benefits, such as:

• Subsidies: Financial support and subsidies on loans and capital investment.

• Tax Benefits: Exemptions and incentives under various tax schemes.

• Credit Support: Access to credit from financial institutions.

• Market Access: Assistance in participating in government procurement and tenders.

• Skill Development: Training and development programs.

Documents Required for MSME Registration:

1. PAN Card of the business.

2. Aadhaar Card of the owner.

3. Business Address Proof.

4. Bank Account Statement.

5. Business Registration Certificate.

6. Proof of Investment in plant and machinery or equipment.

7. Financial Statements (if available).

Protax Advisors view:

MSME registration provides essential benefits that can significantly support small and medium enterprises, including financial assistance, market access, and tax incentives. The process is streamlined and can be completed online through the UDYAM portal, making it accessible and convenient. Proper documentation and accurate information are key to a smooth registration process. Given the advantages, it is highly recommended for businesses falling within the MSME criteria to register and leverage the available government support for growth and development.

One Person Company

Incorporating a One Person Company (OPC) in India is a simplified process governed by the Companies Act, 2013. The OPC structure allows a single individual to form a company while enjoying the benefits of limited liability and a separate legal entity. Below is the step-by-step process:

Obtain a Digital Signature Certificate (DSC)

• Step: The individual forming the OPC must obtain a Digital Signature Certificate (DSC). The DSC is needed to digitally sign electronic forms submitted to the Ministry of Corporate Affairs (MCA).

• Documents Required: Passport-sized photo, address proof, PAN card, and identity proof.

Apply for Director Identification Number (DIN)

• Step: The single director of the OPC must apply for a Director Identification Number (DIN). This can be done through the SPICe+ form during the incorporation process if the director does not already have a DIN.

• Note: Only one DIN is required as an OPC can have only one director initially.

Name Reservation (RUN Application)

• Step: Choose a unique name for your OPC. Apply for the Reserve Unique Name (RUN) service on the MCA portal to get approval for the company’s name.

• Note: The name should comply with the Companies (Incorporation) Rules, 2014. You can submit up to two names, and the MCA will approve one if it is unique and follows the naming guidelines.

Draft the Memorandum of Association (MoA) & Articles of Association (AoA)

• Step: Prepare the Memorandum of Association (MoA), which defines the objectives of the company, and the Articles of Association (AoA), which outlines the company’s internal governance rules.

• Special Clause for OPC: The MoA must specify the nominee (a person who will take over the company’s ownership in case the sole member dies or becomes incapacitated).

Filing the Incorporation Form (SPICe+ Form)

• Step: File the SPICe+ form (Simplified Proforma for Incorporating Company Electronically) for incorporating the OPC. This integrated form allows you to:

• Apply for name reservation (if not done via RUN).

• File for incorporation.

• Apply for DIN.

• Apply for PAN and TAN (for tax registration).

• Documents Required:

• MoA and AoA (signed by the sole director and the nominee).

• Declaration by the director (Form INC-9).

• Proof of registered office (rent agreement, utility bills, NOC from the property owner).

• PAN and address proof of the sole director and nominee.

Payment of Stamp Duty

• Step: Stamp duty is payable depending on the authorized capital of the company and the state in which the registered office is located. The payment is processed during the filing of the SPICe+ form.

Certificate of Incorporation (COI)

• Step: Once the MCA approves the incorporation form, the Certificate of Incorporation (COI) is issued. The COI contains the Corporate Identity Number (CIN) of the company and confirms its legal existence.

• Time Frame: Usually issued within 5-7 business days after form submission.

PAN & TAN Allotment

• Step: Along with the COI, the OPC is automatically allotted a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN), both of which are required for tax filings.

Opening a Bank Account

• Step: With the COI, PAN, and other required documents, the OPC can open a bank account to conduct business transactions.

Post-Incorporation Compliances

• GST Registration: If the OPC’s annual turnover exceeds ₹20 lakhs (₹10 lakhs for certain states) or if the business involves inter-state trade, Goods and Services Tax (GST) Registration is mandatory.

• Shops and Establishment Registration: Required in certain states if the OPC operates a physical office.

• Professional Tax Registration: Needed in states like Maharashtra or Karnataka where professional tax is applicable.

• Annual Compliance: OPCs must file annual returns, including the Financial Statements (Form AOC-4) and Annual Return (Form MGT-7).

Documents Required for OPC Incorporation:

• Memorandum of Association (MoA) and Articles of Association (AoA).

• PAN and Address Proof of the sole director and nominee.

• Proof of Registered Office Address (utility bill, NOC, rent agreement).

• Identity and Address Proof of Director (Aadhaar, Passport, Voter ID, etc.).

Key Features of an OPC:

1. Single Ownership: Only one person acts as both shareholder and director.

2. Limited Liability: The personal assets of the sole owner are protected from the company’s liabilities.

3. Separate Legal Entity: The OPC enjoys a separate legal status from its owner.

4. Nominee: The nomination of a successor ensures business continuity in case the sole member is incapacitated.

Protax Advisors view:

Incorporating a One Person Company (OPC) is an excellent choice for solo entrepreneurs who want the legal protection of a company with limited liability. It offers a middle ground between sole proprietorship and private limited companies, providing the flexibility of a proprietorship but the added benefits of limited liability and a separate legal entity. The simplified incorporation process, combined with fewer compliance requirements compared to other corporate structures, makes the OPC a good option for individual business owners aiming to expand without taking on partners.