4
BUSINESS OPERATIONS – COMPLIANCE MATTERS
Once a business entity has been registered in India , it is important to handle various regulatory compliances . These can be initial registrations , record keeping , tax matters etc . This chapter looks at these matters .
4.1 Immediate on Set-Up
4.1.1 Registrations Generally , the following registrations need to be considered for a company .
( i ) Permanent Account Number ( PAN ) - All tax payers are required to obtain an income tax registration i . e . PAN , which is a unique number of 10 characters allotted by the Income tax authorities . Besides quoting this for tax issues , it is required for various transactions viz . asset acquisition , etc .
( ii ) Tax Deduction Account Number ( TAN ) - While running a business , certain payment will require the payer to withhold tax 9 . A new business is required to obtain a TAN from the Income Tax authorities It is mandatory to quote the TAN in all tax withholding documents viz . challans , certificates , quarterly returns , etc .
( iii ) Service Tax - Is an indirect tax imposed on specified services . A person liable to service tax needs to register within 30 days of providing the services . Registration with department is necessary in case value of services in a financial year exceeds 9 lacs .
( iv ) Value Added Tax ( VAT ) - VAT is levied on sale of goods . Any business proposing to carry out a works contract or trade in goods needs to register for VAT .
( v ) Excise Registration - Excise duty is an indirect tax levy on manufacture of goods . Payment of excise duty arises on removable of goods from the factory .
( vi ) Foreigners Regional Registration Officer ( FRRO ) - Foreigners coming to India on employment need to register with the FRRO within 14 days of their arrival in India .
( vii ) Import Export Code ( IEC ) - Prior to carrying out any export or import activities from India , it is mandatory to obtain an IEC number from the Directorate General of Foreign Trade .
( viii ) Shops and Commercial Establishments Act
4.1.2 Registration for Directors .
( i ) DIN - Every individual , intending to be appointed as a director of a company has to make an application for allotment of Director Identification Number ( DIN ) to the Central Government .
( ii ) PAN based DSC - In order to meet the regulatory and legal compliances , all statutory documents are required to be filed with the Central Government . To do so , the Authorized Signatory of the company has to obtain a Digital Signature Certificate ( DSC ), having encrypted value of his Permanent Account Number ( PAN ) from the certifying authority .
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Refer Section 4.6.1.1
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