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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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