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International Taxation

Tax Consultant in Delhi – TwinDesk Accounting and Legal Advisors LLP

Introduction

Are you searching for an authentic tax consultant in Delhi to manage your tax planning, compliance, and filing?
TwinDesk Accounting and Legal Advisors LLP is a reputed tax consulting firm providing individuals, businesses, and
corporates with trustworthy and genuine solutions. We have been excelling in the field of taxation for years,
possess in-depth knowledge of tax laws and regulations, and offer a broad range of tax advisory services aimed at
minimizing tax liabilities while ensuring complete legal compliance.

Why Choose TwinDesk Accounting and Legal Advisors LLP?

If you are looking for reliable tax consultants in Delhi, TwinDesk Accounting and Legal Advisors LLP offers tax
solutions that are personally tailored to your financial requirements.

If you are seeking professional guidance from experienced tax consultants in Delhi, TwinDesk Accounting and Legal
Advisors LLP is fully equipped to deliver customized and effective tax solutions.

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We also provide representation before tax authorities.

Our Tax Consultancy Services

Corporate Tax Planning and Compliance

Tax structuring for businesses to help reduce tax liabilities.
Accurate collection and filing of corporate tax return forms.
Advisory on transfer pricing and overseas taxation matters.

GST Consultancy and Compliance

GST registration and timely filing of returns.
GST audits and litigation support.
GST advisory related to Input Tax Credit (ITC) claims.

TDS (Tax Deducted at Source) Compliance

TDS provisioning and withdrawal support for enterprises.
TDS return filing and regulatory compliance.
Resolution of TDS-related disputes and notices.

Business Tax Advisory and Compliance

Strategic business tax planning and structuring.
Compliance with direct and indirect tax regulations.
Handling tax audits and assessments efficiently.

Who Can Benefit from Our Tax Consultancy Services?

Salaried Individuals and Freelancers
Small and Medium Enterprises (SMEs)
Large Corporations and MNCs
Startups and Entrepreneurs
Exporters and Importers

Why Hire a Tax Consultant in Delhi?

Hiring an experienced tax consultant in Delhi ensures full compliance with tax laws while maximizing tax-saving
opportunities.

Accurate tax compliance to avoid penalties through timely filing.
Legitimate tax savings and deductions through expert planning.
Professional handling of tax notices and litigation.
Efficient tax planning to reduce overall tax burden.
Freedom to focus on business growth while experts manage tax complexities.

Contact TwinDesk Accounting and Legal Advisors LLP

If you are looking for professional tax consultancy services, TwinDesk Accounting and Legal Advisors LLP is among
the trusted tax consultants in Delhi. Book an appointment with us to receive expert tax solutions.

Ensure smooth tax operations and strategic planning with TwinDesk Accounting and Legal Advisors LLP – your reliable
tax partner in Delhi.

NRI Tax Consultant in Delhi – TwinDesk Accounting and Legal Advisors LLP

Overview of NRI Taxation

A Non-Resident Indian (NRI) is an Indian citizen who has migrated to a foreign country. In India, tax liability is determined based on residential status and not on the nationality or domicile of the taxpayer.

Due to globalization, an increasing number of people are relocating to different countries across the world. With the consistent growth of the Indian economy over the years, there has also been a steady influx of expatriates into India. To deal efficiently with Indian taxation laws, it is essential to engage a knowledgeable NRI tax consultant in Delhi who can guide you in planning your transactions effectively.

Challenges Faced by NRIs and Expatriates

Some of the typical challenges faced by expatriates include adapting to India’s diverse culture, multiple languages, finding suitable accommodation, and complying with tax and regulatory requirements. TwinDesk Accounting and Legal Advisors LLP is one of the trusted NRI consultants in Delhi, possessing extensive expertise in NRI return filing in India.

Income Tax Deductions Available for NRIs under Section 80C

NRIs can avail tax deductions under Section 80C up to a maximum limit of Rs. 1.5 lakhs, similar to resident taxpayers. Some common investment options eligible for deduction under Section 80C include:

Life Insurance Premium Payment

An NRI can claim a tax deduction for the premium paid on a life insurance policy taken for self, spouse, or children (minor or major), provided the premium does not exceed 10% of the capital sum assured.

Repayment of Principal on Housing Loan

NRIs can claim deductions under Section 80C for the principal portion of instalments paid towards repayment of a housing loan taken for purchasing or constructing a residential property. The interest portion of the instalment is not eligible for deduction under Section 80C.

Children’s Tuition Fee Payment

Tuition fees paid by an NRI to any university, college, school, or educational institution in India for full-time education of children qualify for deduction under Section 80C. This benefit is applicable for a maximum of two children and is not available for payments made to institutions outside India.

Investment in ELSS

NRIs can claim deductions under Section 80C for investments made in Equity Linked Savings Schemes (ELSS) of mutual funds.

Our NRI Tax Consultancy Services

Residential Status and Treaty Advisory

Determination of residential status under domestic tax laws and applicable tax treaties.

Employment and Secondment Tax Advisory

Analysis of secondment agreements in comparison with service agreements.

Income and Capital Gains Tax Advisory

Tax advisory related to salary income and capital gain transactions.

India Tax Return Filing and Double Taxation Relief

Preparation and filing of Indian income tax returns and assistance in eliminating double taxation.

NRI ITR Filing in India

Complete support for accurate and timely NRI income tax return filing in India.

Compliance Advisory for NRIs and Expatriates

Counselling on compliance procedures for NRIs and expatriates on international assignments to India.

Income Tax Scrutiny and Assessments

Assistance in handling income tax scrutiny, assessments, and audits.

Repatriation and FEMA Advisory

Advisory on repatriation of funds from India and issuance of required forms to authorized dealer bankers.

Certification and Investment Advisory

Certification services under FEMA and Income Tax laws, along with investment advisory services in India.

Taxability of ESOP Transactions

Advisory on taxation of Employee Stock Option Plan (ESOP) transactions.

Our Experience and Client Commitment

Our deep knowledge and experience in tax matters, combined with personalized responses, have helped us build long-term relationships with satisfied clients across the globe. Our commitment to excellence ensures prompt and responsive communication with our clients.

How TwinDesk Accounting and Legal Advisors LLP Can Help

Key Areas of Assistance

Determination of residential status in India
Interpretation of DTAA to reduce tax liability
Handling inheritance, legacy, and will-related issues
Compliance under the Income-tax Act, 1961 and other tax laws
Application for Permanent Account Number (PAN)
Filing of Indian income tax returns
Advisory on tax-saving investments

Contact Us

If you are looking for an NRI tax consultant in Delhi or need assistance with NRI return filing in India, reach out to TwinDesk Accounting and Legal Advisors LLP today to receive expert and reliable tax solutions.

Double Tax Avoidance Agreement (DTAA)

Overview of DTAA

The Double Tax Avoidance Agreement (DTAA) is a bilateral agreement between two countries, aimed at preventing double taxation and promoting economic trade and investment.

Without such agreements, taxpayers may be liable to pay taxes in two different countries on the same income, leading to unnecessary financial burdens. While many countries provide unilateral relief, DTAA offers a structured mechanism to eliminate tax barriers that restrict global trade, services, and capital movement.

Why is DTAA Needed?

DTAA is necessary due to differences in taxation rules across countries. Double taxation may arise in the following situations:

Income is taxable in both the home country and the foreign country.
Income is exempt in both countries, potentially leading to tax evasion.
A credit system is applied where tax paid in one country is credited against tax payable in another.

These situations generally occur due to overlapping tax laws and variations in residential status or accrual-based taxation systems.

Relief Against Double Taxation

India provides relief from double taxation under Sections 90 and 91 of the Income Tax Act, 1961.

Unilateral Relief (Section 91)

Even if India does not have a DTAA with a specific country, an individual or company may still claim tax relief if the following conditions are met:

The individual or company was a resident of India during the relevant financial year.
The income was taxable in both India and the foreign country.
Tax was paid in the foreign country under its statutory laws.

Bilateral Relief (Section 90)

Where India has entered into a DTAA with another country, tax relief is granted based on mutually agreed terms mentioned in the treaty.

Types of DTAA

DTAA agreements are broadly classified into two categories:

Comprehensive DTAA

Comprehensive DTAAs cover all types of income and may also include wealth tax, gift tax, and other indirect taxes. India has comprehensive DTAA agreements with countries such as:

USA, UK, UAE, Russia, Singapore, Switzerland, Saudi Arabia, South Africa, Thailand, Vietnam, and several others.

Limited DTAA

Limited DTAAs apply only to specific categories of income, such as income from airlines and merchant shipping. Countries having limited DTAA agreements with India include:

Afghanistan, Bulgaria, Ethiopia, Iran, Kuwait, Lebanon, Pakistan, Oman, and Uganda.

Claiming DTAA Benefits for International Businesses

For non-residents, tax liability must be evaluated under both:

The Income Tax Act, 1961
Applicable DTAA provisions

Taxpayers are allowed to choose the option that is more beneficial. With increasing globalization, income is often taxed in multiple jurisdictions, making foreign tax credits essential. DTAA enables individuals and businesses to reduce excessive tax burdens while remaining compliant with tax regulations.

Expert DTAA Advisory by TwinDesk Accounting and Legal Advisors LLP

At TwinDesk Accounting and Legal Advisors LLP, we specialize in DTAA advisory and international tax compliance. Our experienced team assists individuals and businesses with:

Understanding DTAA benefits
Optimizing international tax structures
Foreign tax credit planning
Filing tax returns involving cross-border transactions
Ensuring compliance with Indian tax laws

Contact Us

For personalized DTAA advisory and international tax solutions, connect with TwinDesk Accounting and Legal Advisors LLP today and benefit from expert guidance.

Meaning of Expatriate (Expat)

An expatriate is an individual who temporarily resides and works in a foreign country while maintaining citizenship in their home country. The taxation of expatriate employees involves a slightly different computation compared to regular employees of an Indian organization.

Taxation of Foreign Expats Working in India

For any foreign expatriate employed in India, their salary is considered earned in India if it is paid for services rendered in India, as per Section 9(1)(ii) of the Income Tax Act. This rule applies irrespective of the residential status of the expatriate employee.

Additionally, the income of expatriates is subject to Tax Deducted at Source (TDS), regardless of where the salary is credited. Even if the salary is deposited in the expatriate’s home country, it remains subject to Indian TDS.

If the salary is paid in foreign currency, it is converted into Indian Rupees (INR) for tax computation purposes. The conversion is done using the telegraphic transfer buying rate of the State Bank of India (SBI), in accordance with Rule 26 and Section 192(6) of the Income Tax Act. Tax is calculated based on the applicable rate on the date of deduction.

Tax Grossing-Up for Expatriates

When a foreign expatriate receives salary in India, only the net salary after tax is credited to their account. The Indian employer bears the tax liability, which means the expatriate’s gross salary includes both the net salary and the tax payable. This mechanism is known as tax grossing-up.

Computation of Tax on Expatriate Salary in India

The highest income tax rate applicable in India is 30%.
An additional 4% health and education cess is levied.
The effective total tax rate comes to 31.2%.

Avoidance of Double Taxation for Expats

Expatriates often face the risk of being taxed both in their home country and in India. In cases where the expatriate’s home country does not have a Double Tax Avoidance Agreement (DTAA) with India, tax relief can still be claimed under Section 91 of the Income Tax Act.

Under this provision, expatriates can claim a deduction from Indian income tax for taxes already paid in the foreign country. The deduction is limited to the lower of the following:

The Indian income tax payable on such income
The actual tax paid in the foreign country

Expert Expatriate Taxation Services by TwinDesk Accounting and Legal Advisors LLP

Taxation of expatriates in India is complex and requires specialized knowledge and compliance expertise. At TwinDesk Accounting and Legal Advisors LLP, we offer comprehensive expatriate taxation services, including:

Repatriation assistance for expatriate employees
Annual tax equalization calculations
Tax compliance services
Tax return preparation and filing
Representation in tax assessments, appeals, and litigation
Advisory on double taxation and tax planning

Additional Financial and Tax Services

In addition to expatriate taxation, we provide a wide range of financial services such as accounting and bookkeeping, auditing and assurance, tax audits, management audits, statutory audits, income tax planning, and direct and indirect taxation services.

For expert assistance with expatriate taxation and related services, contact TwinDesk Accounting and Legal Advisors LLP today.

Understanding Forms 15CA and 15CB

If you are a law-abiding, tax-paying citizen, it is important to understand the significance of Forms 15CA and 15CB. These forms play a crucial role in ensuring tax compliance when making foreign remittances.

Form 15CA is a declaration of remittance and serves as a tool for collecting information regarding payments made to non-residents that are taxable in India. It enables the Income Tax Department to track foreign remittances and assess applicable tax liabilities.

Form 15CB is a certification issued by a Chartered Accountant (CA) confirming the details of the payment, applicable TDS rate, deduction of TDS, and the nature and purpose of the remittance.

While filing Form 15CA, details from Form 15CB may also be required. However, as per Rule 37BB of the Income Tax Rules, certain transactions are exempt from the requirement of Form 15CB.

Applicability of Forms 15CA and 15CB

When is Form 15CA Required?

The remittance is made to a foreign company or a non-resident.
The remitter may be a foreign company, domestic company, resident, or non-resident.
The remitted amount is chargeable to tax in India.

When is Form 15CB Required?

The remittance is taxable and made to a foreign company or a non-resident.
The payment amount exceeds ₹5 lakhs.
No certificate or exemption order has been obtained from the Assessing Officer.

Filing Process for Forms 15CA and 15CB

The Income Tax Department has simplified the filing process of Forms 15CA and 15CB to enhance clarity and compliance. Below is a step-by-step guide:

Filing Process for Form 15CA

Visit the Income Tax e-filing portal and log in using valid credentials.
Navigate to the Income Tax Forms section.
Select Form 15CA from the drop-down list.
Choose the relevant part of the form based on the nature of remittance.
Fill in the required details and submit the form.
Complete the verification section of the selected part.

Note: If Part C of Form 15CA is applicable, Form 15CB must be uploaded first, as its acknowledgment number is mandatory. If the process appears complex, it is advisable to seek expert assistance for Form 15CA and 15CB filing.

Filing Process for Form 15CB

Since Form 15CB can only be filed by a Chartered Accountant, the following procedure is followed:

Visit the Income Tax e-filing portal and go to the Downloads section.
Under the My Account section, add a CA by entering their membership number and selecting Form 15CB.
Once the CA is registered, download the Form 15CB utility from the Downloads page.
The CA prepares the form offline and generates an XML file.
Navigate to the e-File tab, select Upload Form, and upload the XML file.
Submit the form using a Digital Signature Certificate (DSC).

After successful submission, a confirmation email is sent to the Chartered Accountant.

Revised Rules for Forms 15CA and 15CB

Form 15CB is required only when the payment is taxable and exceeds ₹5 lakhs.
Part A of Form 15CA is applicable if the payment is below ₹5 lakhs, whether taxable or not.
Parts B and C of Form 15CA are applicable when the payment exceeds ₹5 lakhs.
Part D of Form 15CA is used when the payment is not chargeable to tax under the Income Tax Act.

Conclusion

Forms 15CA and 15CB are essential for ensuring tax compliance in cases of foreign remittances. These forms act as mandatory declarations and certifications required by banks before processing international transactions.

As tax compliance related to foreign remittances can be complex, this guide is intended to simplify the process. If you require professional assistance with filing Forms 15CA and 15CB, feel free to contact TwinDesk Accounting and Legal Advisors LLP for expert support.

Residential Status under the Income Tax Act

Recently, due to the ongoing COVID-19 pandemic, many NRIs got stranded in India, which triggered concerns about their residential status in the country.
It is imperative to check the residential status of a person for every financial year because this is one of the key factors that determine the taxability of income.

The term “residential status” is defined under the Income Tax Act of India and has no relation to a person’s citizenship.
An individual may be an Indian citizen and still be a non-resident for a particular financial year.
Similarly, a foreign citizen may become a resident of India for income tax purposes in a specific year.

Types of Residential Status

The taxability of an individual varies based on their residential status.
Before understanding tax implications, it is essential to know how a taxpayer is classified as:

Resident and Ordinarily Resident (ROR)
Resident but Not Ordinarily Resident (RNOR)
Non-Resident (NR)

Who is a Resident in India?

As per Section 6(1) of the Income Tax Act, an individual is considered a resident in India for a particular financial year if they satisfy either of the following conditions:

The individual has been in India for at least 182 days during the previous year, or
The individual has been in India for at least 365 days in the four financial years preceding the previous year
and for a minimum of 60 days in the relevant previous year.

Who is a Non-Resident in India?

If an individual does not satisfy either of the above conditions, they are considered a non-resident for that financial year.

Exceptions

Certain individuals will be considered residents in India only if their stay in the relevant previous year is 182 days or more:

Indian citizens leaving India as crew members of an Indian ship or for employment abroad.
Indian citizens or persons of Indian origin residing outside India who visit India during the relevant previous year.

If such individuals have total income exceeding Rs. 15 lakhs (excluding foreign income), they will be considered residents if:

Their stay in India during the relevant previous year is at least 182 days, or
They have been in India for at least 365 days in the four preceding years
and at least 120 days in the relevant previous year.

Deemed Resident (Section 6(1A))

An Indian citizen earning more than Rs. 15 lakhs (excluding foreign income) in a financial year
will be deemed a resident in India if they are not taxable in any other country due to residence, domicile,
or similar criteria, even if they do not meet the conditions of Section 6(1).

Resident and Ordinarily Resident (ROR) vs RNOR

A resident individual is further classified as ROR or RNOR.
As per Section 6(6), a person is considered RNOR if they satisfy any of the following conditions:

They were a non-resident in India for 9 out of the 10 preceding financial years.
Their stay in India during the last 7 years is 729 days or less.
They are an Indian citizen or person of Indian origin with income exceeding Rs. 15 lakhs
and stayed in India for at least 120 days but less than 182 days during the relevant year.
They are an Indian citizen deemed resident under Section 6(1A).

If none of the above conditions are satisfied, the individual is classified as a
Resident and Ordinarily Resident (ROR).

Important Points to Note

Stay in India need not be continuous or at a single location.
Date of arrival and date of departure are both included.
Residential status is determined separately for each financial year.
Foreign income excludes income from a business controlled or profession set up in India.

Examples of Residential Status

Example 1

Mr. Mohan, a Belgian citizen, stayed in India as follows:

2016–17: 54 days
2017–18: 61 days
2018–19: 93 days
2019–20: 146 days
2020–21: 68 days

Since his stay in the preceding four years was less than 365 days and his stay in 2020–21 was below 182 days,
he is a Non-Resident for A.Y. 2021–22.

Example 2

Mr. John returned to India permanently on 1st April 2019 after being a non-resident since 1990.
Though he stayed in India for more than 182 days in 2020–21, he is classified as
Resident but Not Ordinarily Resident (RNOR) for A.Y. 2021–22.

Scope of Total Income

Income Source	ROR	RNOR	NR
Income received or deemed to be received in India	Yes	Yes	Yes
Income accruing or arising in India	Yes	Yes	Yes
Income accruing or arising outside India	Yes	Only if business is controlled in India	No

A Resident (ROR) is taxed on global income, whereas NR and RNOR are taxed mainly on Indian income.

Taxation Considerations for NRIs

If an NRI becomes a resident in India, their global income becomes taxable in India,
and appropriate income tax returns must be filed.

Double Taxation Avoidance Agreement (DTAA)

If income is taxed in India and another country, NRIs can claim relief under the
Double Taxation Avoidance Agreement (DTAA).

Tax Planning for NRIs

NRIs should plan their visits carefully to maintain non-resident status wherever possible,
as non-residents generally have a lower tax burden.

For expert assistance in determining residential status, tax filing, or DTAA benefits,
you can contact TwinDesk Accounting and Legal Advisors LLP.
Our team provides professional guidance on NRI taxation, double taxation, and related tax matters.

COMPANY AND LLP COMPLIANCES

Company Registration

In the dynamic business environment of a bustling metropolis like Delhi, numerous businesses thrive as flagship or premium brands in their respective industries. If you are looking to start a new venture that can compete with industry giants or expand your business through a new wing, you may be considering registering your business or setting up a company in India.

Many entrepreneurs opt for private limited company registration in Delhi due to the multiple benefits it offers. In today’s era of corporatisation, registering a business in India can be a strategic move to expand your company, boost its success, and increase your Return on Investment (ROI). Apart from lowering your tax liabilities, business registration also ensures limited liability, allowing you to focus on growing your enterprise.

Company registration in New Delhi, India, comes with numerous advantages. Some of the key benefits are discussed below:

1. Reduce Personal Liabilities

Whether you opt for an Online Company Registration in India, a Public Limited or Private Limited Company, registration is essential to limit personal liabilities. Even if your business operates online and does not have a physical store, you may still face personal liability for errors or defective products due to sole ownership or a partnership structure.

Without proper registration, your personal assets could be at risk. However, by registering your company, any debts attached to the business will not affect your personal assets. Additionally, the company formation procedure is smooth, and the fees for incorporation in Delhi are quite reasonable.

2. Ability to Raise Capital Easily

Adequate funding is the backbone of any successful business. By registering as a full-fledged company, it becomes significantly easier to raise money and attract investors. A registered business has the ability to incur debt, borrow funds, and more importantly, raise equity capital by selling shares.

3. Minimize Conflict With Co-Founders

One of the biggest advantages of registering your business in India is that it helps in avoiding conflicts with your co-founders. During the registration process, the allocation of shares and the distribution of control among owners are clearly documented.

This ensures that every owner has a clear understanding of their investment share, and in case of disputes, the shareholding agreement determines the decision-making power.

4. Minimize Your Tax Liability

Opting for a One Person Company (OPC) registration in Delhi or any other company structure often results in lower tax obligations. The tax burden varies based on the company’s revenue, but businesses registered under corporate structures enjoy access to multiple tax benefits.

Additionally, registered companies can avail themselves of tax deductions on expenses such as advertising, repairs and maintenance, and educational expenses.

5. Enhancing Brand Awareness and Business Legitimacy

Having a registered company structure significantly boosts your business's credibility and brand awareness. When you register a new company in Delhi, you enhance your company’s reputation and legitimacy in the eyes of customers and clients.

Registration ensures that your business is accountable to regulatory authorities, fostering trust and making it easier to engage with third-party vendors and business partners.

Why Choose TwinDesk Accounting and Legal Advisors LLP for Your Company Registration?

At TwinDesk Accounting and Legal Advisors LLP, based in New Delhi, we are pioneers in business registration and legal compliance. We provide end-to-end solutions for all aspects of company formation, ensuring a seamless and hassle-free experience.

We Specialize In:

Company Registration in West Delhi
Company Formation in India
Private Limited Company Registration
Section 8 Company Registration
LLP Registration in Delhi and India
Business Setup Services in India

Our Team Handles:

Company Name Registration
Preparation of MOA (Memorandum of Association) and AOA (Articles of Association)
Allotment of DIN (Director Identification Number)
Obtaining the Incorporation Certificate
Banking & Financial Assistance
Filing of Annual Returns
Winding-up & Liquidation of Companies and LLPs
E-Filing of Documents with MCA (Ministry of Corporate Affairs)
Compliance with the Companies Act, 2013

Your Trusted Business Partner

From incorporation to business operations, we provide guidance at every step of your entrepreneurial journey. Whether you need assistance with how to register a company in Delhi, understand the company formation procedure in India, or require expert support for company incorporation, we are here to help!

📩 For professional consultation, reach out to us at:
📧 admit@twindeskllp.com

Company Annual Compliances

Running a Private Limited or Public Limited Company was once a simple procedure under the Companies Act, 1956, as the Registrar of Companies (ROC) did not enforce strict penalties on defaulters. However, under the new Companies Act, 2013, stringent regulatory provisions have been introduced. In case of non-compliance, the company and its management personnel can face substantial monetary penalties along with other legal consequences.

To avoid such risks, it is crucial to meet all statutory compliances on time. At TwinDesk Accounting and Legal Advisors LLP, we help businesses fulfill their ROC legal requirements and company annual compliances, ensuring a smooth and hassle-free experience.

What Are the Mandatory Compliances for a Private Limited Company?

Compared to a Public Limited Company, the statutory compliances for a Private Limited Company are less stringent. Below are some of the essential compliance requirements for Private Limited Companies:

1. First Board Meeting

As per the Companies Act, 2013, a company must hold its first board meeting within 30 days of incorporation. A notice must be sent to all directors at least 7 days prior to the meeting.

2. Subsequent Board Meetings

Every company is required to conduct at least 4 board meetings annually, with an interval of no more than 120 days between two meetings. However, certain companies are allowed to hold only two board meetings, provided there is a minimum gap of 90 days between them.

3. Disclosure of Interest by Directors

Every director must disclose their interest in any company, firm, or association in the following cases:

At the first board meeting they attend as a director.
At the first board meeting of every financial year.
Whenever there is any change in interest.

This disclosure must be made using Form MBP-1 and must include a list of relatives and their concerns as per the Related Party Transaction definition. The form should be filed timely and maintained in company records.

4. Appointment of First Auditor

The Board of Directors must appoint the first auditor within 30 days of incorporation. This auditor will hold office until the first Annual General Meeting (AGM). Notably, filing Form ADT-1 is not mandatory for the first auditor appointment.

5. Appointment of Subsequent Auditor

During the first AGM, the Board must appoint an auditor who will serve until the conclusion of the sixth AGM. The company must file Form ADT-1 with the ROC within 15 days of appointment to notify them of the auditor’s appointment.

6. Holding of Annual General Meeting (AGM)

Every Private Limited Company must hold an AGM on or before 30th September each year, during business hours, on a non-public holiday at the registered office or in the same city, town, or village.

For ROC filing, a 21-day clear notice must be sent to all shareholders before the AGM. The ROC filing fees depend on multiple factors such as company size and share capital.

7. Filing of Annual Return (Form MGT-7)

Every Private Limited Company must file its Annual Return (Form MGT-7) within 60 days of the AGM. The return must cover the period from 1st April to 31st March of the respective financial year.

8. Filing of Financial Statements (Form AOC-4)

A company must file its audited balance sheet, profit and loss statement, and Board’s Report in Form AOC-4 with the Ministry of Corporate Affairs (MCA) within 30 days of the AGM.

9. Statutory Audit of Accounts

Every company must prepare its books of accounts and get them audited by a Chartered Accountant (CA). After the Board of Directors' approval, the auditor will issue an Audit Report, which must be filed with the Registrar of Companies (ROC).

Post-Incorporation Compliances

Compliances do not end with company registration. Several post-incorporation requirements must also be met. It is highly recommended to hire an experienced professional to ensure compliance and avoid penalties.

DPT-3 Filing

Companies that have received money or loans due must file Form DPT-3. The DPT-3 filing fees vary based on company size and financial transactions.

How TwinDesk Accounting and Legal Advisors LLP Can Assist You

At TwinDesk Accounting and Legal Advisors LLP, we specialize in Private Limited Company Compliances and ROC Filing Services in Delhi. Our dedicated team ensures your business meets all legal requirements smoothly.

Our Services Include:

Company Secretarial Services
Annual Compliance Filing for Private Limited Companies
ROC Filing Services in Delhi
Board Meeting Compliance Management
Statutory Audit & Financial Statement Filing
DPT-3 Filing and Advisory

📩 For expert guidance, reach out to us at:
📧 admit@twindeskllp.com

Certification and Attestation Services

One of the most meticulous and vital services provided by professionals is the issuance of certificates required by clients for various legal and regulatory purposes. Businesses need certificates based on the nature of the entity, compliance requirements under different laws, financial dealings with banks and financial institutions, eligibility for benefits and deductions, and periodic compliance obligations.

At TwinDesk Accounting and Legal Advisors LLP, we offer certification and attestation services to help businesses meet their legal and regulatory requirements efficiently.

Types of Certificates Required for Business Activities in India

Businesses in India require various certificates for compliance, taxation, finance, and legal matters. Some of the most common certificates include:

Certificates supporting accounts and annual financial statements.
Certificates for maintaining statutory records under the Companies Act, 2013 and other relevant laws.
Certification of statutory liabilities for regulatory compliance.
Fair Valuation of Shares Certification for mergers, acquisitions, demergers, buy-backs, and share allotments or transfers.
Certification for remittances abroad by an Indian resident under Section 195 of the Income Tax Act, 1961.
Net Worth Certificates required for bank financing, furnishing of bank guarantees, and visa applications.
Tax Residency Certificate (TRC) for claiming relief under Double Taxation Avoidance Agreements (DTAAs).
Certification of arm’s length price under Section 92 of the Income Tax Act, 1961 for transfer pricing compliance.
Utilization Certificates for grants issued by the Government of India to NGOs, statutory bodies, autonomous organizations, and charitable institutions.
Certificates for claiming tax deductions and exemptions under various statutory provisions.
Certification under Income Tax laws for registrations, exemptions, and deductions.
Transfer Pricing Certificates for international taxation compliance.
GST Certification for various matters, including claiming GST refunds.
Certification under indirect tax laws, including Exchange Control regulations for imports, remittances, ECB, DGFT, and EOU.
Certification for MSME investment in plant and machinery.

Attestation Services

Attestation Services involve the verification and authentication of documents by a Chartered Accountant (CA) to ensure compliance with various Indian laws. Every individual or business requires attestation on documents under different statutory and regulatory frameworks.

Types of Attestation Services for Financial Statements

There are three types of attestation services related to the financial statements of an entity:

1. Compilation Services

Small businesses that lack an in-house accounting team often outsource the preparation of financial statements to a CA. This process, known as compilation, is used when businesses want to demonstrate that their financial statements have been prepared by a professional accountant.

2. Review Services

A review involves a limited examination of financial statements, providing moderate assurance regarding their accuracy and completeness. Unlike a full audit, it is narrower in scope and is typically used by lenders and external stakeholders to assess financial stability.

3. Audit Services

An audit provides reasonable assurance that a company’s financial statements are free from material misstatements. Businesses undergo audits to provide creditors, investors, and regulatory authorities with an independent assessment of their financial health.

The audit process involves:

Preparation of financial statements for auditor review.
Inclusion of footnotes and disclosures in financial reports.
Providing documentary evidence to support transactions.
Maintaining documented accounting policies and procedures.
Responding to auditors’ queries during the audit process.

A company aims to receive an "unmodified" or "clean" audit opinion from the auditor, which signifies accurate and fair financial reporting.

What TwinDesk Accounting and Legal Advisors LLP Offers?

At TwinDesk Accounting and Legal Advisors LLP, we provide comprehensive certification and attestation services tailored to the needs of businesses across different industries. Our services include:

Certification work for statutory compliance, tax laws, and financial reporting.
Attestation of financial statements for businesses and individuals.
Expert guidance in legal and regulatory certification processes.
Ethical, professional, and practical solutions ensuring compliance with tax and corporate laws.
Fast, reliable, and hassle-free processing of certificates and attestations.

If you need certification and attestation services in Delhi, contact us at:
📧 admit@twindeskllp.com

LLP Annual Filings

For a Limited Liability Partnership (LLP), timely filing of returns is crucial to ensure compliance and avoid hefty penalties. While LLPs have fewer compliance requirements compared to private limited companies, the penalties for non-compliance are significantly higher. For instance, while a private company may face penalties of up to INR 1 lakh, an LLP can be fined up to INR 5 lakh for non-compliance.

Since an LLP is a separate legal entity, it is the responsibility of designated partners to maintain proper books of accounts and file an annual return with the Ministry of Corporate Affairs (MCA) every year. Auditing is mandatory only if the annual turnover exceeds INR 40 lakh or the contribution exceeds INR 25 lakh, making LLP compliance relatively simpler compared to private companies.

Key LLP Annual Filing Requirements

1. Filing of Annual Return (Form 11)

Deadline: 30th May every year.
Purpose: Summarizes LLP’s management affairs, partner details, and compliance status.
Certification Requirement: If the total contribution exceeds INR 50 lakh or the turnover exceeds INR 5 crore, the form must be certified by a practicing Company Secretary.

2. Filing of Statement of Accounts & Solvency (Form 8)

Deadline: 30th October every year.
Purpose: Records the profit earned, financial data, and solvency status of the LLP.
Certification Requirement: Must be attested by designated partners and certified by a practicing Chartered Accountant, Company Secretary, or Cost Accountant.
Penalty for Late Filing: INR 100 per day.

3. Filing of Income Tax Return for LLPs

Mandatory: For all LLPs, regardless of turnover.
Deadline:
For LLPs not requiring an audit: 31st July.
For LLPs requiring an audit: 30th September.

4. Audit Requirement Under Income Tax Act

LLPs with a turnover exceeding INR 40 lakh or a contribution exceeding INR 25 lakh must have their accounts audited by a practicing Chartered Accountant.

New Web-Based Process for LLP Filing on MCA Portal

MCA has introduced the V3 version of MCA21, making all LLP filings web-based instead of downloadable forms. The LLP-11 and LLP-8 forms are now to be filled directly on the MCA website under Section 35 of the LLP Act, 2008, read with Rule 25 (1) of the LLP Rules, 2009.

Key Features of the Web-Based Process:

No need to download blank forms; everything is filled online.
80% of the form data is pre-filled (e.g., partner details, capital contribution, etc.).
Filing restrictions apply if there are pending Form LLP-4 submissions (related to partner changes).

Process of Filing Forms (LLP-8 & LLP-11) Online:

Register as a business user on the MCA portal.
Fill the web-based form on the MCA website.
Submit the form to generate the SRN (Service Request Number).
Download the auto-generated PDF from the “My Application” tab.
Affix the DSC (Digital Signature Certificate) using Adobe.
Upload the signed document back on the MCA portal against the SRN.

Advantages of Limited Liability Partnership (LLP)

Separate Legal Entity: LLPs have an identity distinct from their partners.
Easy Ownership Transfer: Ownership can be transferred without complex procedures.
Limited Liability Protection: LLP assets and liabilities are separate from the promoters.
Flexible Fundraising: LLPs can raise funds from banks, partners, and NBFCs.

LLP Annual Filing Services at TwinDesk Accounting and Legal Advisors LLP

Compliance is mandatory for all LLPs, irrespective of turnover or transaction volume. Filing annual returns on time ensures that businesses avoid unnecessary penalties and remain compliant with legal requirements.

At TwinDesk Accounting and Legal Advisors LLP, we offer:

Expert assistance in LLP annual return filing online.
Timely submission of LLP Form 8 & Form 11.
Income Tax Return Filing for LLPs.
Audit compliance and certification services.
Hassle-free online compliance management.

For professional LLP compliance and filing services, reach out to us at:
📧 admit@twindeskllp.com

LLP Formations

LLP Registration in India

The concept of Limited Liability Partnership (LLP) gained popularity in India after the enactment of the Limited Liability Partnership Act in 2008. Startups and small businesses prefer LLPs over traditional partnerships and companies because LLPs combine the advantages of both. LLPs offer limited liability protection to owners while requiring minimum maintenance and compliance.

One of the key benefits of an LLP structure is that one partner is not held responsible for another partner’s wrongdoing or negligence. This makes LLPs a preferred choice for professionals, micro-enterprises, and small businesses.

Benefits of Forming an LLP

Operating a business as an LLP offers several advantages:

✔ Dual benefits – Combines the flexibility of a partnership with the security of a company.
✔ Limited liability – Protects personal assets of partners.
✔ No liability for partner misconduct – One partner’s mistakes do not affect others.
✔ Lower incorporation costs – LLPs are less expensive to register than private limited companies.
✔ Flexible agreement – Partners can draft an LLP agreement based on their business needs.
✔ Funding opportunities – LLPs can raise funds from partners, banks, and NBFCs.

Step-by-Step Process of LLP Registration in India

Step 1: Name Approval

File an application for reservation of LLP name using the RUN-LLP service on the MCA portal.
The name must be unique and not similar to an existing business entity.

Step 2: Obtain Digital Signature Certificate (DSC)

Every proposed Designated Partner must obtain a DSC, as it is mandatory for filing all LLP-related forms.

Step 3: Incorporation of LLP (FiLLiP Webform)

File the FiLLiP (Form for Incorporation of LLP) along with Webform 9 on the MCA portal.

FiLLiP is an integrated service for LLP incorporation, which also includes:

Issuance of PAN & TAN for LLP.
Issuance of DIN/DPIN for Designated Partners.
Allows LLP incorporation with up to 500 partners.
No separate addendum is required for FiLLiP, simplifying the process.

Consent of Designated Partners who already have a DPIN must be submitted through Webform 9, which is now a linked attachment to FiLLiP.

Step 4: Filing LLP Agreement (Form 3)

Within 30 days of LLP incorporation, partners must execute the LLP Agreement and file Webform 3 with the Registrar of Companies (RoC).
The LLP Agreement outlines partners' rights, liabilities, and duties.
Previously, Form 3 was downloaded and uploaded separately, but now it must be filled directly on the MCA V3 portal.

LLP Registration Services at TwinDesk Accounting and Legal Advisors LLP

If you are looking for LLP registration in India, TwinDesk Accounting and Legal Advisors LLP provides reliable and cost-effective solutions. We specialize in:

✔ LLP registration online with complete legal assurance.
✔ Assistance with LLP name approval, FiLLiP filing, and LLP Agreement drafting.
✔ Guidance on LLP registration cost, process, and compliance in Delhi.

For expert assistance in LLP formation in Delhi, contact us at:
📧 admit@twindeskllp.com

Services

FC-GPR and RBI Compliance

Everything You Need to Know About FC-GPR

The Reserve Bank of India (RBI) has introduced an online application called FIRMS (Foreign Investment Reporting and Management System) to streamline the reporting of Form FC-GPR. FC-GPR stands for Foreign Currency – Gross Provisional Return, a form used to report Foreign Direct Investment (FDI) transactions.

This guide explains the FC-GPR filing procedure, legal provisions, checklist, and FAQs related to it.

What is FC-GPR?

When a business receives Foreign Direct Investment (FDI) through capital investment, it must issue shares to the foreign investor and report the transaction to the Reserve Bank of India (RBI) using Form FC-GPR.

As per RBI compliance for FDI, entities that issue shares against foreign investment must file Form FC-GPR within 30 days of allotment.

The term entity includes:

✔ Companies registered under Section 1(4) of the Companies Act, 2013.
✔ Limited Liability Partnerships (LLPs) under the Limited Liability Partnership Act, 2008.
✔ Startups that comply with Notification No. G.S.R 180(E) dated February 17, 2016 issued by the Department of Industrial Policy & Promotion (DIPP), Ministry of Commerce & Industry.

FDI Entry Routes

Foreign Direct Investment (FDI) is permitted under two routes:

1️⃣ Automatic Route: No prior government approval is needed. Non-residents and Indian companies can invest freely in permitted sectors.

2️⃣ Government Route: Requires approval from the respective Administrative Ministry/Department before investment.

When is Form FC-GPR Filing Required?

Entities must file Form FC-GPR in the following cases:

📌 At incorporation: If a shareholder is a non-resident, filing FC-GPR is mandatory as per RBI compliance.

📌 Upon receipt of share application money: Shares must be allotted within 60 days, and Form FC-GPR must be filed within 30 days of allotment.

Legal Provisions for FC-GPR Filing

✔ Compliance with RBI’s consolidated FDI policy – including sectoral caps, entry routes, and pricing guidelines.
✔ Adherence to SEBI regulations, FEMA, and other applicable laws governing foreign investments.

Which Securities are Covered Under FC-GPR?

✔ Equity shares
✔ Convertible preference shares
✔ Convertible debentures

Steps for Filing Form FC-GPR

Register the business entity with RBI FIRMS Portal.
Login to FIRMS and access the Single Master Form (SMF).
Select “Return Type” and fill in common investment details.
Provide foreign investment details.
Enter total amount of inflow and capital instruments issued.
Upload supporting documents.
Verify the auto-populated shareholding pattern.
Save and submit the form.

Required Attachments for Form FC-GPR

📌 KYC documents.
📌 FIRC (Foreign Inward Remittance Certificate).
📌 Declaration by authorized company representative.
📌 Company Secretary (CS) certificate (RBI prescribed format).
📌 Pricing guidelines declaration.
📌 Declaration for conversion of CCPS.
📌 FIPB approval copy (if applicable).
📌 Valuation Report from CA or Merchant Banker.
📌 Board Resolution with list of allottees.

Foreign Liabilities and Assets (FLA) Reporting

✔ Mandatory for Indian companies receiving FDI or making overseas investments.
✔ Annual return to be filed by 15th July.

Introduction of the FLAIR System

RBI is replacing the email-based FLA submission system with a secure web-based platform called FLAIR.

Key Features of FLAIR

✅ Web-based registration and login.
✅ Entity identification through RBI credentials.
✅ Financial year-wise submission.
✅ System-driven validation checks.
✅ Auto-generated acknowledgment receipt.
✅ Option to revise or view previous filings.
✅ RBI approval required for previous year submissions.

Why Compliance with RBI Regulations is Important?

Many businesses are unaware of RBI’s FDI compliance requirements. Failure to file Form FC-GPR within the prescribed timeline can attract heavy penalties under FEMA.

Since reporting foreign investments is complex, RBI provides detailed manuals, and professional assistance is strongly recommended.

For expert assistance in FC-GPR filing, RBI compliance, and foreign investment reporting in Delhi, contact us at:
📧 admit@twindeskllp.com

Foreign Company Setup in India

India offers affordable human resources, land, water, and electricity in abundance, making it an attractive destination for foreign companies to establish their presence. Like domestic entities, foreign companies operating in India must comply with specific legal and regulatory requirements under Indian laws.

This guide explains how foreign companies can start a business in India and the compliance requirements under the Companies Act, 2013.

What is a Foreign Company?

A foreign company is defined as a company or body corporate incorporated outside India that:

Has a place of business in India, either physically or electronically, whether by itself or through an agent.
Conducts any business activity in India in any manner.

Even a mere virtual or visual presence in India qualifies a foreign entity under this definition.

An Indian subsidiary of a foreign company is one in which 50% or more of the equity shares are held by a company incorporated outside India. In such cases, the foreign entity is known as the holding or parent company.

As per the Companies (Registration Offices and Fees) Rules, 2014, all documents required to be filed by foreign companies must be submitted to the Registrar of Companies, New Delhi, irrespective of their place of business in India.

Procedure for Foreign Company Registration in India

Once a foreign company establishes a place of business in India, it must file Form FC-1 with the Registrar within 30 days, along with the following documents:

Charter documents (translated into English).
Address of the registered or principal office.
List of all directors and secretaries.
Name and address of the person(s) resident in India authorized to receive notices.
Address of the place of business in India.
Details of any previous place of business in India.
Declaration regarding non-conviction or debarment of directors or representatives.
Any other relevant information.

Upon successful filing, a Foreign Company Registration Number (FCRN) is generated and a certificate of registration is issued.

Information Required for Directors and Secretaries

Full name and previous names (if any).
Father’s/Mother’s name and spouse’s name.
Date of birth, nationality, and residential address.
PAN (if available) and passport details.
Occupation and directorship details in other entities.
Membership number (for secretaries).
Email ID.

Alteration in Foreign Company Documents

If there is any alteration in the documents submitted during registration, the company must file Form FC-2 within 30 days of such change.

Mandatory attachments include:

Certified copy of board resolution.
Copy of resolution passed in general meeting.
Approval letter (if applicable).
Changes in business address in India.
Changes in directors or secretaries.
Changes in authorized representatives.
Other relevant optional attachments.

Financial Statements and Audit Requirements

Foreign companies must prepare financial statements of their Indian business operations in accordance with Schedule III of the Companies Act, 2013 and file them using Form FC-3 within 6 months from the end of the financial year.

The Registrar may grant an extension of up to 3 months.

Accounts must be audited by a practicing Chartered Accountant or a CA firm/LLP.

Mandatory attachments include:

Consolidated financial statements.
Balance Sheet and Profit & Loss Account.
Details of related party transactions and fund repatriation.
Approval letters for Indian establishments.
Any other relevant optional information.

Annual Return Filing

Foreign companies must file their annual return using Form FC-4 within 60 days from the end of the financial year.

Required details include:

Promoters, directors, and KMP details.
Remuneration details.
Meeting and attendance details.
Details of members and debenture holders.
Holding, subsidiary, and associate company details.
Penalties or compounding details (if any).

Foreign Company Registration Number (FCRN)

While Indian companies are identified by a Corporate Identity Number (CIN), foreign companies are allotted a six-digit FCRN, generated automatically upon approval of Form FC-1.

Setting Up a Liaison Office (LO) or Branch Office (BO) in India

A foreign entity can establish a business presence in India by opening a Liaison Office or Branch Office. Prior approval from RBI is generally required.

Key Differences Between LO and BO

Eligibility:

Liaison Office: Minimum 3 years profit track record and USD 50,000 net worth.
Branch Office: Minimum 5 years profit track record and USD 100,000 net worth.

Time Required: 3–4 months, subject to RBI approvals.

Validity:

LO: 3 years (2 years for NBFCs and construction entities).
BO: Generally valid for 2–3 years.

Taxability:

LO: Not taxable in India.
BO: Taxed at approximately 41.60%–43.68% including surcharge and cess.

Importance of DIN for Foreign Companies

DIN is not mandatory for directors of foreign companies operating in India through branch offices.

How TwinDesk Accounting and Legal Advisors LLP Can Help

At TwinDesk Accounting and Legal Advisors LLP, we assist foreign investors in setting up businesses in India, including Indian subsidiaries, branch offices, liaison offices, and franchise registrations.

For professional assistance in foreign company registration in India, contact us at:
📧 admit@twindeskllp.com

Company Strike Off and LLP Closure

There are multiple ways a company can cease to exist, one of which is striking off its name from the register of companies. A company that is inactive and wants to remove its name from the registrar’s records may opt for this method.

Before diving deeper, it is important to distinguish between striking off and liquidation. Striking off refers to the process where a company’s name is removed from the register, while liquidation or dissolution is the final stage where the company is officially wound up.

This process can be initiated either by the Registrar of Companies (ROC) or voluntarily by the company.

Grounds for Striking Off by ROC

The company has failed to commence business within one year of incorporation.
The company has not carried out any business operations for the last two financial years and has not applied for dormant status.
Physical verification by the ROC confirms that the company is not operating.
The company’s subscribers have not paid subscription money and have not filed a declaration within 180 days of incorporation.

If the ROC identifies any of these conditions, it sends a notice to the company and its directors with 30 days to respond. Unsatisfactory responses may lead to continuation of the strike-off process. Notices are also published on the ROC website and in newspapers.

Voluntary Company Closure Process

Inactive companies may opt for voluntary striking off to avoid compliance obligations. The procedure includes:

Board meeting to appoint an authorized director and schedule an Extraordinary General Meeting (EGM).
Clear all liabilities and sign indemnity bond and affidavit using Forms STK-3 and STK-4.
Prepare a statement of accounts certified by a Chartered Accountant (not older than 30 days).
Pass a special resolution in the EGM approving closure; regulatory authority approval (RBI, SEBI, IRDAI) if applicable.
File Form STK-2 with ₹10,000 fee along with attachments: NOC, indemnity bond, affidavit, statement of accounts (Form STK-8), EGM resolution.

ROC invites objections from public and authorities. After settling dues and addressing objections, the company is officially liquidated.

Restoration of a Struck-Off Company

A company struck off despite being active can appeal for restoration with the National Company Law Tribunal (NCLT) within three years of the final order.

Forms Involved in the Striking Off Process

Form STK-1: Notice by ROC for intention to strike off.
Form STK-2: Application for voluntary striking off.
Form STK-3: Indemnity Bond by directors.
Form STK-4: Affidavit by directors.
Form STK-5, 5A, 6: Public notices.
Form STK-7: Final notice by ROC.
Form STK-8: Company’s statement of accounts.

Certain companies cannot opt for strike off, including Section 8 companies, listed companies, vanishing companies, or companies with pending charges, prosecutions, or winding-up proceedings.

LLP Closure Process

The closure process for a Limited Liability Partnership (LLP) is similar but involves fewer documents. LLPs can be closed voluntarily or by ROC by filing LLP Form-24.

Designated partners authorize a partner to file LLP Form-24.
Ensure pending forms (Form-8, Form-11) are submitted and regulatory approvals obtained if necessary.
File Form-24 with required attachments.
ROC publishes a public notice for one month to invite objections.
Once no valid objections exist and debts are cleared, ROC publishes notice of dissolution in the official gazette, and the LLP is dissolved.

Restoration of LLPs

Unlike companies, LLPs cannot appeal to the NCLT. The only remedy is filing a writ petition in the High Court.

Professional Assistance for Company and LLP Closure

Closing a company or LLP in India is straightforward, but professional guidance is recommended. Naveen Pandey & Associates provides expert services for private limited company strike-off and LLP closures, ensuring a hassle-free and cost-effective process.

For assistance, contact us at:
📧 ca.naveenpandey@gmail.com

TRANSFER PRICING

Transfer Pricing - Overview

Transfer Pricing: Its Meaning and Objective

Transfer pricing refers to pricing transactions among subsidiaries in the same group that operate under common control. Both local and international deals may be subject to transfer pricing. Typically, transfer prices align with the current market value of the product or service offered by one division, subsidiary, or holding company.

"Transfer pricing" refers to the prices of transactions between related parties like the parent and subsidiary, which may take place under conditions differing from those between independent enterprises. The transfer price between related parties may not always be at par with the transfer price in transactions with unrelated parties.

For instance, suppose a company A purchases goods for Rs. 100/- and sells them to its associated company B in another country for Rs. 200/-. Company B, in turn, sells the goods in the open market for Rs. 400/-. If company A had directly sold the goods in the latter country, it would have made a profit of Rs. 300/-. However, by routing the transaction through company B, it restricts its profit to Rs. 100/-, permitting company B to appropriate the balance. Since the transactions between A and B are arranged and not governed by market forces, the profit amounting to Rs. 200/- is shifted to the country of B. The goods are transferred at an arbitrary or dictated transfer price (Rs. 200/-), rather than the market price (Rs. 400/-).

To protect revenue interests, the Income Tax Act, 1961 ("the Act") has framed specific provisions under Chapter X. The basic principle outlined in these provisions is to ensure that international transactions follow the arm's length price concept. Almost every entity associated with an international entity faces transfer pricing regulations in India. We assist such entities in determining the correct transfer pricing by providing transfer pricing reports for Indian companies, ensuring compliance within the legal framework.

According to the Internal Revenue Service (IRS), transfer pricing in intra-company deals must be the same as in third-party deals. By imposing transfer pricing rules, taxpayers can ensure they never engage in transactions with related or affiliated businesses that are not at arm's length. Therefore, the primary objective of these laws is to maintain records proving that all inter-company transactions adhere to the arm’s length principle. The taxpayer must provide these records to the Transfer Pricing Officer ("TPO") upon request to meet the legal burden of proof.

Transfer Pricing Rules Adopted in India

To implement Transfer Pricing Regulations (TPR), new sections 92A through 92F were added to the Income Tax Act, and corresponding rules 10A through 10E were included in the Income Tax Rules, 1962, under the Finance Act of 2001. Foreign transactions that are legally binding and meet specific criteria after April 1, 2001, are subject to these rules.

TPR was enacted in 2001 to protect India's revenue stream from losses caused by price manipulation and profit shifting in cross-border trade. The Finance Bill, 2001, clarified that the purpose of TPR was to prevent transfer pricing fraud. Before these specific clauses were added, the Act did not fully implement transfer pricing laws in India.

The amendments introduced under TPR include new sections 92A through 92F, addressing issues such as calculating income from international transactions based on arm’s length pricing, defining an affiliated firm, determining the scope of international transactions, assessing whether a transaction is arm's length, and dealing with major concerns in transfer pricing.

Transfer Pricing Methods

There are several methods for determining the arm’s length price of transactions for transfer pricing under income tax laws. These methods help ascertain whether the commercial or financial relations between related parties are consistent with the arm’s length principle. The selection of the most appropriate method depends on the facts and circumstances of each case.

1. Comparable Uncontrolled Price (CUP) Method

The CUP method compares the price and conditions of goods or services in a controlled transaction between related parties with those of an uncontrolled transaction between independent enterprises. This method requires the transactions between associated enterprises to be highly similar to those between independent enterprises.

2. Resale Price Method

The resale price method determines the arm’s length price by taking the selling price of a product or service (resale price) and reducing it by a gross margin. This margin is determined by comparing similar transactions made by unrelated entities. After deducting purchasing costs, such as customs duties, the final price is considered the arm’s length price.

3. Cost-Plus Method

The cost-plus method evaluates a controlled transaction between an associated purchaser and supplier. It is commonly used when semi-finished goods are exchanged between related entities or when long-term "buy and supply" agreements exist. The supplier's costs are added to an appropriate markup to determine a fair profit margin, resulting in the arm’s length price.

4. Transactional Net Margin Method

The Transactional Net Margin Method determines transfer prices by analyzing the net profit of a transaction between related parties and comparing it to net profits from comparable transactions among unrelated enterprises. This is the most commonly used transfer pricing method, as it does not require exact similarities between controlled and uncontrolled transactions.

5. Profit Split Method

In certain cases, associated enterprises engage in highly interrelated transactions that cannot be assessed individually. In such cases, related enterprises may agree to split the profits. The Profit Split Method examines controlled transactions by determining how unrelated enterprises would have shared profits from such transactions.

Why Choose TwinDesk Accounting and Legal Advisors LLP?

We are one of the best transfer pricing consultants in Delhi, providing complete support in preparing TP reports. Our services include:

Assistance in transfer pricing planning and documentation
Preparation of transfer pricing study/documentation
Transfer pricing audit (Form No. 3CEB)
Country-by-country reporting
Representation before the Transfer Pricing Officer (TPO)
Transfer pricing litigation before higher authorities (CIT Appeals, Dispute Resolution Panel, Income Tax Appellate Tribunal - ITAT)

Having dedicated significant time to these processes, we provide sound technical advice in various business and economic scenarios. Our solutions are practical, useful, and implementable, helping CFOs and tax managers make informed decisions regarding transfer prices within their group companies.

If you have any queries related to transfer pricing, feel free to reach out to us at:
📧 admin@twindeskllp.com

TP Audit & Compliance

What is Transfer Pricing Audit?

India has been developing rapidly in recent years, making it a popular destination for foreign companies. With liberalization, a growing middle class, and rising employment and wages, India has become not only a popular tourist destination but also an attractive investment hub.

However, starting a business in India comes with several tax and regulatory challenges. To prevent multinational corporations from avoiding their tax obligations in India, the Indian government introduced the Transfer Pricing Regulation, which includes specific conditions for conducting a transfer pricing audit.

A transfer pricing audit is required when two or more affiliated businesses enter into a transaction. Various test techniques are applied and documented to determine whether these transactions were conducted under market conditions and can withstand scrutiny from the Income Tax Department and other tax authorities.

Indian businesses engaging in international transactions must review and comply with Transfer Pricing Regulations and maintain accurate records. A transfer pricing audit must explain how transfer prices were determined for businesses and transactions under review.

Purpose of a Transfer Pricing Audit

Transfer pricing audits serve as fact-finding missions to evaluate a company's operations, identify risks, determine appropriate transfer pricing methods, and recognize the relevant parties involved.

An analysis of comparable businesses worldwide is conducted to establish benchmarks for the chosen company based on collected data. Using this information, the assessee creates a comprehensive transfer pricing report with supporting documentation. As per the Indian Income Tax Act of 1961, the audit report must be submitted using Form 3CEB.

Key Provisions Governing Transfer Pricing Audit

Maintaining Accurate Records: All parties involved in an overseas transaction must keep accurate and up-to-date records of their dealings.
Using Market Values: Profits from overseas transactions must be calculated using market values. Several factors, including the transaction type, the nature of the organization, and other financial conditions, are considered when determining the arm’s length price.
Methods of Determining Transfer Price: The Central Board of Direct Taxes (CBDT) prescribes specific methods, including the Comparable Uncontrolled Price (CUP) Method, Resale Price Method, Cost-Plus Method, and Transactional Net Margin Method.
Arm’s Length Price Determination: If multiple fair prices are assumed for a particular transaction, the arm’s length price is determined by averaging those prices.
Submission of Form 3CEB: Any individual or organization involved in international transactions must submit a transfer pricing audit report through Form 3CEB, prepared by a Chartered Accountant, before filing their Income Tax Return.
Penalties for Non-Compliance: The CBDT has the authority to impose fines and penalties on individuals or organizations that fail to comply with transfer pricing regulations.

Importance of Transfer Pricing Audit

A transfer pricing audit is essential to ensure compliance with Indian tax regulations. Section 92E of the Income Tax Act mandates that parties engaging in cross-border or certain domestic transactions must provide an independent auditor’s report.

An accountant must sign and validate the necessary forms for any cross-border or domestically targeted transaction conducted in the previous calendar year before the due date. In addition to international deals, certain domestic transactions also require auditing, and Form 3CEB must be submitted accordingly.

If you have any queries related to transfer pricing audits and compliance, feel free to reach out to us at:
📧 admin@twindeskllp.com

TP Study Report

Transfer Pricing Study: What is it, and what does it do?

A transfer pricing study aims to determine how businesses charge one another for services provided by two or more associated companies. The IRS and other tax authorities examine these transactions using various test procedures to assess whether they were conducted under market conditions and can withstand regulatory scrutiny.

The study must justify why the chosen transfer pricing methodology is appropriate for the businesses and transactions under review. It ensures that transactions are conducted at arm’s length pricing, meaning they resemble fair market transactions between independent entities.

Since all the company's activities are ultimately consolidated into a single audited financial statement, discrepancies or inconsistencies in transfer pricing are usually resolved without significantly impacting financial statements as a whole. However, related companies are still expected to behave independently in their dealings. Pricing must remain competitive, and there should be room for profit in each transaction.

Multinational corporations sometimes attempt to shift profits to low-tax jurisdictions to minimize their tax burden. While such strategies may seem beneficial, they carry significant tax risks if not executed properly within legal boundaries.

Key Aspects of a Transfer Pricing Study

A transfer pricing study analyzes a company’s cost structure, overhead expenses, and its various business divisions. It incorporates a Functions, Assets, and Risks (FAR) analysis, which compares an affiliated company with independent entities performing similar activities.

This study also considers the local market conditions and identifies comparable organizations or transactions that help determine a reasonable pricing structure. By applying these benchmarks, businesses can establish pricing that aligns with international tax regulations.

When conducted correctly, a transfer pricing study provides strong and credible evidence to the IRS and tax authorities in case of an audit. This helps safeguard taxpayers from penalties that can be as high as 40% of their adjusted income. Additionally, it ensures financial auditors that the tax compliance process is transparent and will not negatively impact financial statements.

For Indian businesses to comply with Transfer Pricing Regulations, it is essential to review all international transactions from a legal perspective and maintain proper documentation.

Importance of a Transfer Pricing Audit and Study Report

India began integrating with the global economy when its foreign exchange and trade policies were liberalized in 1991. Since then, foreign direct investment (FDI) has surged, with increasing movement of goods, services, capital, and intangibles across borders. The relaxation of import restrictions and monetary policies has further facilitated international trade.

Given the growing interest of global corporations in India, Indian tax authorities are now paying closer attention to transfer pricing issues. Indian companies have expanded globally through strategic mergers, acquisitions, and offshore subsidiaries, making transfer pricing legislation and compliance reporting more critical than ever.

With international taxation evolving, transfer pricing audits are becoming an unavoidable reality for businesses engaged in inter-company transactions. Managing tax planning and regulatory compliance can be challenging, especially for multinational corporations operating under different tax regimes.

While companies strive to avoid audits, there is no foolproof way to ensure that they will never be audited. Instead, the best approach is to be well-prepared in case an audit occurs.

The tax department cannot oversee every aspect of a business, but specific operational activities may increase the risk of an audit. Therefore, submitting timely and accurate reports can significantly reduce potential tax risks and penalties.

If you have any queries regarding transfer pricing study reports, feel free to contact us at:
📧 admin@twindeskllp.com

Tax Consultant in Delhi – TwinDesk Accounting and Legal Advisors LLP

Introduction

Why Choose TwinDesk Accounting and Legal Advisors LLP?

If you are looking for reliable tax consultants in Delhi, TwinDesk Accounting and Legal Advisors LLP offers tax
solutions that are personally tailored to your financial requirements.

If you are seeking professional guidance from experienced tax consultants in Delhi, TwinDesk Accounting and Legal
Advisors LLP is fully equipped to deliver customized and effective tax solutions.

Moreover, we provide a sample of select textile materials to familiarize clients with our product line, hoping some
of these fabrics may be chosen for fashion collections.

We also provide representation before tax authorities.

Our Tax Consultancy Services

Corporate Tax Planning and Compliance

Tax structuring for businesses to help reduce tax liabilities.
Accurate collection and filing of corporate tax return forms.
Advisory on transfer pricing and overseas taxation matters.

GST Consultancy and Compliance

GST registration and timely filing of returns.
GST audits and litigation support.
GST advisory related to Input Tax Credit (ITC) claims.

TDS (Tax Deducted at Source) Compliance

TDS provisioning and withdrawal support for enterprises.
TDS return filing and regulatory compliance.
Resolution of TDS-related disputes and notices.

Business Tax Advisory and Compliance

Strategic business tax planning and structuring.
Compliance with direct and indirect tax regulations.
Handling tax audits and assessments efficiently.

Who Can Benefit from Our Tax Consultancy Services?

Salaried Individuals and Freelancers
Small and Medium Enterprises (SMEs)
Large Corporations and MNCs
Startups and Entrepreneurs
Exporters and Importers

Why Hire a Tax Consultant in Delhi?

Hiring an experienced tax consultant in Delhi ensures full compliance with tax laws while maximizing tax-saving
opportunities.

Accurate tax compliance to avoid penalties through timely filing.
Legitimate tax savings and deductions through expert planning.
Professional handling of tax notices and litigation.
Efficient tax planning to reduce overall tax burden.
Freedom to focus on business growth while experts manage tax complexities.

Contact TwinDesk Accounting and Legal Advisors LLP

Ensure smooth tax operations and strategic planning with TwinDesk Accounting and Legal Advisors LLP – your reliable
tax partner in Delhi.

NRI Tax Consultant in Delhi – TwinDesk Accounting and Legal Advisors LLP

Overview of NRI Taxation

Challenges Faced by NRIs and Expatriates

Income Tax Deductions Available for NRIs under Section 80C

NRIs can avail tax deductions under Section 80C up to a maximum limit of Rs. 1.5 lakhs, similar to resident taxpayers. Some common investment options eligible for deduction under Section 80C include:

Life Insurance Premium Payment

Repayment of Principal on Housing Loan

Children’s Tuition Fee Payment

Investment in ELSS

NRIs can claim deductions under Section 80C for investments made in Equity Linked Savings Schemes (ELSS) of mutual funds.

Our NRI Tax Consultancy Services

Residential Status and Treaty Advisory

Determination of residential status under domestic tax laws and applicable tax treaties.

Employment and Secondment Tax Advisory

Analysis of secondment agreements in comparison with service agreements.

Income and Capital Gains Tax Advisory

Tax advisory related to salary income and capital gain transactions.

India Tax Return Filing and Double Taxation Relief

Preparation and filing of Indian income tax returns and assistance in eliminating double taxation.

NRI ITR Filing in India

Complete support for accurate and timely NRI income tax return filing in India.

Compliance Advisory for NRIs and Expatriates

Counselling on compliance procedures for NRIs and expatriates on international assignments to India.

Income Tax Scrutiny and Assessments

Assistance in handling income tax scrutiny, assessments, and audits.

Repatriation and FEMA Advisory

Advisory on repatriation of funds from India and issuance of required forms to authorized dealer bankers.

Certification and Investment Advisory

Certification services under FEMA and Income Tax laws, along with investment advisory services in India.

Taxability of ESOP Transactions

Advisory on taxation of Employee Stock Option Plan (ESOP) transactions.

Our Experience and Client Commitment

How TwinDesk Accounting and Legal Advisors LLP Can Help

Key Areas of Assistance

Determination of residential status in India
Interpretation of DTAA to reduce tax liability
Handling inheritance, legacy, and will-related issues
Compliance under the Income-tax Act, 1961 and other tax laws
Application for Permanent Account Number (PAN)
Filing of Indian income tax returns
Advisory on tax-saving investments

Contact Us

Double Tax Avoidance Agreement (DTAA)

Overview of DTAA

The Double Tax Avoidance Agreement (DTAA) is a bilateral agreement between two countries, aimed at preventing double taxation and promoting economic trade and investment.

Why is DTAA Needed?

DTAA is necessary due to differences in taxation rules across countries. Double taxation may arise in the following situations:

Income is taxable in both the home country and the foreign country.
Income is exempt in both countries, potentially leading to tax evasion.
A credit system is applied where tax paid in one country is credited against tax payable in another.

These situations generally occur due to overlapping tax laws and variations in residential status or accrual-based taxation systems.

Relief Against Double Taxation

India provides relief from double taxation under Sections 90 and 91 of the Income Tax Act, 1961.

Unilateral Relief (Section 91)

Even if India does not have a DTAA with a specific country, an individual or company may still claim tax relief if the following conditions are met:

The individual or company was a resident of India during the relevant financial year.
The income was taxable in both India and the foreign country.
Tax was paid in the foreign country under its statutory laws.

Bilateral Relief (Section 90)

Where India has entered into a DTAA with another country, tax relief is granted based on mutually agreed terms mentioned in the treaty.

Types of DTAA

DTAA agreements are broadly classified into two categories:

Comprehensive DTAA

Comprehensive DTAAs cover all types of income and may also include wealth tax, gift tax, and other indirect taxes. India has comprehensive DTAA agreements with countries such as:

USA, UK, UAE, Russia, Singapore, Switzerland, Saudi Arabia, South Africa, Thailand, Vietnam, and several others.

Limited DTAA

Limited DTAAs apply only to specific categories of income, such as income from airlines and merchant shipping. Countries having limited DTAA agreements with India include:

Afghanistan, Bulgaria, Ethiopia, Iran, Kuwait, Lebanon, Pakistan, Oman, and Uganda.

Claiming DTAA Benefits for International Businesses

For non-residents, tax liability must be evaluated under both:

The Income Tax Act, 1961
Applicable DTAA provisions

Expert DTAA Advisory by TwinDesk Accounting and Legal Advisors LLP

At TwinDesk Accounting and Legal Advisors LLP, we specialize in DTAA advisory and international tax compliance. Our experienced team assists individuals and businesses with:

Understanding DTAA benefits
Optimizing international tax structures
Foreign tax credit planning
Filing tax returns involving cross-border transactions
Ensuring compliance with Indian tax laws

Contact Us

For personalized DTAA advisory and international tax solutions, connect with TwinDesk Accounting and Legal Advisors LLP today and benefit from expert guidance.

Meaning of Expatriate (Expat)

Taxation of Foreign Expats Working in India

Tax Grossing-Up for Expatriates

Computation of Tax on Expatriate Salary in India

The highest income tax rate applicable in India is 30%.
An additional 4% health and education cess is levied.
The effective total tax rate comes to 31.2%.

Avoidance of Double Taxation for Expats

Under this provision, expatriates can claim a deduction from Indian income tax for taxes already paid in the foreign country. The deduction is limited to the lower of the following:

The Indian income tax payable on such income
The actual tax paid in the foreign country

Expert Expatriate Taxation Services by TwinDesk Accounting and Legal Advisors LLP

Repatriation assistance for expatriate employees
Annual tax equalization calculations
Tax compliance services
Tax return preparation and filing
Representation in tax assessments, appeals, and litigation
Advisory on double taxation and tax planning

Additional Financial and Tax Services

For expert assistance with expatriate taxation and related services, contact TwinDesk Accounting and Legal Advisors LLP today.

Understanding Forms 15CA and 15CB

Form 15CB is a certification issued by a Chartered Accountant (CA) confirming the details of the payment, applicable TDS rate, deduction of TDS, and the nature and purpose of the remittance.

While filing Form 15CA, details from Form 15CB may also be required. However, as per Rule 37BB of the Income Tax Rules, certain transactions are exempt from the requirement of Form 15CB.

Applicability of Forms 15CA and 15CB

When is Form 15CA Required?

The remittance is made to a foreign company or a non-resident.
The remitter may be a foreign company, domestic company, resident, or non-resident.
The remitted amount is chargeable to tax in India.

When is Form 15CB Required?

The remittance is taxable and made to a foreign company or a non-resident.
The payment amount exceeds ₹5 lakhs.
No certificate or exemption order has been obtained from the Assessing Officer.

Filing Process for Forms 15CA and 15CB

The Income Tax Department has simplified the filing process of Forms 15CA and 15CB to enhance clarity and compliance. Below is a step-by-step guide:

Filing Process for Form 15CA

Visit the Income Tax e-filing portal and log in using valid credentials.
Navigate to the Income Tax Forms section.
Select Form 15CA from the drop-down list.
Choose the relevant part of the form based on the nature of remittance.
Fill in the required details and submit the form.
Complete the verification section of the selected part.

Filing Process for Form 15CB

Since Form 15CB can only be filed by a Chartered Accountant, the following procedure is followed:

Visit the Income Tax e-filing portal and go to the Downloads section.
Under the My Account section, add a CA by entering their membership number and selecting Form 15CB.
Once the CA is registered, download the Form 15CB utility from the Downloads page.
The CA prepares the form offline and generates an XML file.
Navigate to the e-File tab, select Upload Form, and upload the XML file.
Submit the form using a Digital Signature Certificate (DSC).

After successful submission, a confirmation email is sent to the Chartered Accountant.

Revised Rules for Forms 15CA and 15CB

Form 15CB is required only when the payment is taxable and exceeds ₹5 lakhs.
Part A of Form 15CA is applicable if the payment is below ₹5 lakhs, whether taxable or not.
Parts B and C of Form 15CA are applicable when the payment exceeds ₹5 lakhs.
Part D of Form 15CA is used when the payment is not chargeable to tax under the Income Tax Act.

Conclusion

Residential Status under the Income Tax Act

Types of Residential Status

The taxability of an individual varies based on their residential status.
Before understanding tax implications, it is essential to know how a taxpayer is classified as:

Resident and Ordinarily Resident (ROR)
Resident but Not Ordinarily Resident (RNOR)
Non-Resident (NR)

Who is a Resident in India?

As per Section 6(1) of the Income Tax Act, an individual is considered a resident in India for a particular financial year if they satisfy either of the following conditions:

The individual has been in India for at least 182 days during the previous year, or
The individual has been in India for at least 365 days in the four financial years preceding the previous year
and for a minimum of 60 days in the relevant previous year.

Who is a Non-Resident in India?

If an individual does not satisfy either of the above conditions, they are considered a non-resident for that financial year.

Exceptions

Certain individuals will be considered residents in India only if their stay in the relevant previous year is 182 days or more:

Indian citizens leaving India as crew members of an Indian ship or for employment abroad.
Indian citizens or persons of Indian origin residing outside India who visit India during the relevant previous year.

If such individuals have total income exceeding Rs. 15 lakhs (excluding foreign income), they will be considered residents if:

Their stay in India during the relevant previous year is at least 182 days, or
They have been in India for at least 365 days in the four preceding years
and at least 120 days in the relevant previous year.

Deemed Resident (Section 6(1A))

Resident and Ordinarily Resident (ROR) vs RNOR

A resident individual is further classified as ROR or RNOR.
As per Section 6(6), a person is considered RNOR if they satisfy any of the following conditions:

They were a non-resident in India for 9 out of the 10 preceding financial years.
Their stay in India during the last 7 years is 729 days or less.
They are an Indian citizen or person of Indian origin with income exceeding Rs. 15 lakhs
and stayed in India for at least 120 days but less than 182 days during the relevant year.
They are an Indian citizen deemed resident under Section 6(1A).

If none of the above conditions are satisfied, the individual is classified as a
Resident and Ordinarily Resident (ROR).

Important Points to Note

Stay in India need not be continuous or at a single location.
Date of arrival and date of departure are both included.
Residential status is determined separately for each financial year.
Foreign income excludes income from a business controlled or profession set up in India.

Examples of Residential Status

Example 1

Mr. Mohan, a Belgian citizen, stayed in India as follows:

2016–17: 54 days
2017–18: 61 days
2018–19: 93 days
2019–20: 146 days
2020–21: 68 days

Since his stay in the preceding four years was less than 365 days and his stay in 2020–21 was below 182 days,
he is a Non-Resident for A.Y. 2021–22.

Example 2

Scope of Total Income

Income Source	ROR	RNOR	NR
Income received or deemed to be received in India	Yes	Yes	Yes
Income accruing or arising in India	Yes	Yes	Yes
Income accruing or arising outside India	Yes	Only if business is controlled in India	No

A Resident (ROR) is taxed on global income, whereas NR and RNOR are taxed mainly on Indian income.

Taxation Considerations for NRIs

If an NRI becomes a resident in India, their global income becomes taxable in India,
and appropriate income tax returns must be filed.

Double Taxation Avoidance Agreement (DTAA)

If income is taxed in India and another country, NRIs can claim relief under the
Double Taxation Avoidance Agreement (DTAA).

Tax Planning for NRIs

NRIs should plan their visits carefully to maintain non-resident status wherever possible,
as non-residents generally have a lower tax burden.

Item #2

Accounts Outsourcing & Bookkeeping Services - Overview

Competency, know-how, experience, and expertise drive us to offer a wide range of outsourcing services to our clients, helping them manage heavy workloads and ease operational burdens. With peace of mind as our guiding principle, we extend a capable helping hand to businesses. TwinDesk Accounting and Legal Advisors LLP is renowned for providing the best accounting and bookkeeping services in Delhi.

Accounting Services

We offer comprehensive accounting services tailored to meet the specific requirements of small companies and overseas organizations with subsidiaries in India. These businesses require real-time financial data, making accurate and efficient accounting essential.

Benefits of Outsourcing Accounting Services

Cost-Saving: Outsourcing accounting functions is often more cost-effective than hiring an in-house team. It eliminates expenses related to recruitment, training, payroll taxes, insurance, and employee benefits. Additionally, hiring professional bookkeeping services in Delhi provides access to a team of experts with diverse skills.
Access to Expertise: By outsourcing accounting to a reputable firm, businesses gain access to seasoned accounting professionals who ensure that financial records are accurate, payroll is compliant, and all regulatory obligations are met, minimizing the risk of penalties.
Increased Control & Reduced Fraud: Entrusting accounting functions to a single employee can increase the risk of fraud and financial mismanagement. Outsourcing bookkeeping services to an external firm strengthens internal controls and reduces this risk.
Operational Flexibility: Scaling up operations while managing accounting in-house can be challenging. Outsourcing allows businesses to adjust their accounting workload efficiently, ensuring that financial records remain up-to-date and well-managed.

If you are seeking bookkeeping services for small businesses in Delhi, feel free to contact us for the best accounting solutions.

Payroll Services

We use cloud-based payroll software to streamline employee-employer interactions, improving transparency and efficiency. Employees receive personal login credentials, allowing them to view/download payslips, submit reimbursement claims, and declare investments effortlessly. We also offer HR documentation services, including appointment letters and HR policy consulting.

Understanding Salary Structure in India

An employee’s salary consists of various components, including basic salary, allowances, bonuses, and perquisites. Below is a breakdown of these elements:

Basic Salary: A fixed component that forms 35-50% of an employee’s total salary, used as a base for calculating other benefits and allowances. It is fully taxable.
Allowances: Monetary benefits provided in addition to basic salary, such as:
- Dearness Allowance (DA): A percentage of basic pay to offset inflation.
- House Rent Allowance (HRA): Compensation for rental expenses.
- Leave Travel Allowance (LTA): Reimbursement of travel expenses during leaves.
Gratuity: A one-time payment given as a token of appreciation to employees who complete at least five years of continuous service, as per the Payment of Gratuity Act, 1972.
Employee Provident Fund (EPF): A retirement benefit where both employer and employee contribute to a savings fund, accessible at retirement or resignation.
Perquisites (Fringe Benefits): Non-cash benefits such as company cars, rent-free accommodation, and insurance coverage, which are generally taxable.
Variable Pay: A performance-based salary component, given as bonuses or incentives upon achieving specific targets.

If you want to learn more about PF rules and taxability or need assistance with PF registration in Delhi, we are here to help.

Financial Reporting Services

We assist in preparing critical financial reports that help businesses, investors, and stakeholders make informed decisions. These reports include:

Cash Flow Statements: To track inflows and outflows of cash.
Profitability Statements: To assess the company’s financial performance.
Return on Investment (ROI) Reports: To evaluate the profitability of investments.

Why Financial Reports Matter:

Investors analyze financial statements to decide whether to buy, sell, or hold shares.
Prospective investors assess a company’s growth potential before investing.
Banks and financial institutions review reports to determine an organization’s ability to repay loans before approving credit.

Regulatory Compliance Services

At TwinDesk Accounting and Legal Advisors LLP, we ensure businesses comply with all regulatory requirements by managing their statutory filings, tax returns, and financial reports. Our compliance solutions help businesses navigate complex legal frameworks effortlessly.

Why Choose TwinDesk Accounting and Legal Advisors LLP?

Proven Expertise: Our team comprises seasoned professionals with vast experience in auditing, accounting, and taxation.
Cost-Effective & Timely Services: We offer affordable and prompt financial solutions tailored to your needs.
Commitment to Excellence: We are dedicated to delivering top-tier accounting, payroll, and compliance services with the highest level of professionalism.

If you are looking for reliable accounting and bookkeeping services in Delhi, contact us at:
📧 admin@twindeskllp.com
We are here to assist you with the best financial solutions for your business.

Accounting and Bookkeeping Services

Bookkeeping is the art of identifying, approving, sorting, and recording a company’s financial transactions in a systematic manner. This allows financial data to be retrieved and presented for management reporting and decision-making. It forms an integral part of the accounting process, ensuring that all financial affairs are recorded as journal entries.

At TwinDesk Accounting and Legal Advisors LLP, we are recognized for offering the best accounting and bookkeeping services in Delhi, ensuring that businesses maintain accurate, reliable, and complete financial records.

Key Financial Statements Every Business Must Maintain

Maintaining proper financial statements is essential for compliance, financial analysis, and decision-making. The key components include:

1. Income Statement

An Income Statement provides a summary of a business’s income and expenses over a specific period (monthly, quarterly, or annually). It measures the profitability of the business and helps stakeholders understand the company’s financial performance.

2. Balance Sheet

A Balance Sheet presents a business’s financial position at a specific point in time by listing its assets, liabilities, and equity. It reflects the company’s current net worth and helps assess whether it can meet its financial obligations.

3. Notes to Financial Statements

The Notes to Financial Statements provide additional details and explanations about financial data. They cover aspects like asset depreciation, accounting policies, and contingent liabilities, ensuring transparency and compliance with accounting standards.

4. Cash Flow Statement

A Cash Flow Statement details how cash flows in and out of a business over a given period. It helps investors and creditors assess a company’s solvency and understand how cash is generated and utilized.

5. Statement of Changes in Equity

This document outlines changes in a company’s share capital, retained earnings, and reserves over time. It varies depending on the business structure:

For sole proprietors, it tracks changes in the owner’s equity.
For partnerships, it reflects how equity is distributed among partners.
For companies, it details changes in shareholders’ equity.

If you are unsure how to prepare these statements, you can outsource your accounting to a trusted accounting firm in India. If you are looking for top accounting firms in Dwarka, we are here to offer expert accounting outsourcing services tailored to your business needs.

Importance of Bookkeeping

Effective bookkeeping plays a critical role in managing a business’s finances. Here’s why:

Organized Financial Records: Ensures all transactions are properly recorded, making it easy to track income and expenses.
Timely Financial Statements: Well-maintained books allow quick preparation of P&L statements, balance sheets, and cash flow reports.
Better Business Overview: Helps businesses analyze financial position and make data-driven decisions.
Improved Financial Planning: Enables businesses to create budget forecasts and plan for the future.
Enhanced Decision-Making: Supports strategic and profitable decision-making with clear financial insights.
Business Growth: Tracking financial records helps measure growth and profitability effectively.
Effective Financial Management: Answers key questions like expenditure, outstanding dues, and payment obligations.
Goal Achievement: Helps align operations with long-term objectives.
Tax Planning: Enables accurate tax planning and compliance with regulations.
Audit Preparedness: Simplifies audits and ensures compliance with accounting laws.
Legal Compliance: Helps maintain books as per legal requirements, avoiding penalties.

Benefits of Accounting & Bookkeeping

Saves time and reduces administrative workload.
Better management of accounts receivables and payables.
Improved data security with structured financial records.
Minimizes risks associated with financial mismanagement.
Reduces overhead costs, making business operations more cost-efficient.
Enhances decision-making with accurate financial insights.
Ensures high accuracy in financial reporting.
Drives business growth and profitability.

Bookkeeping and Accounting at TwinDesk Accounting and Legal Advisors LLP

Maintaining accurate financial records is crucial for tracking a business’s financial health. It enables management to make informed decisions and implement corrective measures when needed.

At TwinDesk Accounting and Legal Advisors LLP, our bookkeeping services focus on cost reduction and financial management. Our team of experienced accounting professionals delivers the best accounting outsourcing services in India, ensuring compliance with accounting standards and regulations.

If you need reliable accounting and bookkeeping services, feel free to contact us at:
📧 admin@twindeskllp.com
Our expert team is ready to assist you with the most efficient and compliant financial solutions for your business.

Payroll Management

Introduction

The success of a company depends on two critical factors: hiring a quality team and having an efficient system to manage that team effectively. While recruiting the right talent is essential, ensuring that payroll operations run smoothly is equally important.

Employers must maintain accurate records of employee data, including salaries, tax deductions, government tax payments, and leave records. This can be a complex and time-consuming process, requiring meticulous attention and continuous effort.

Payroll becomes essential from the moment a company hires its first employee. Since payroll taxes directly impact a business’s net income, payroll management is crucial for both legal and accounting compliance.

Key Steps Involved in Payroll Processing

Managing payroll efficiently involves a series of structured steps. The essential stages of payroll processing include:

1. Calculate Gross Pay

For salaried employees, the annual salary is divided by the number of pay periods in the year.
For hourly employees, gross pay is calculated by multiplying the hourly wage by the number of hours worked, including any overtime or premium compensation as per applicable laws.

2. Withhold Deductions

Deduct pre-tax contributions, such as Provident Fund (PF) contributions and other voluntary deductions.
Withhold Income Tax, Medicare, and Social Security taxes as per statutory requirements.

3. Pay Employees

Disburse net pay to employees.
Provide employees with pay statements in compliance with legal requirements.

4. Remit Taxes to the Government

Deposit withheld taxes to the relevant authorities within the specified deadlines.
Ensure compliance with the appropriate submission and reporting methods.

5. Maintain Payroll Records

Retain essential payroll documents in accordance with legal and regulatory requirements.
Proper documentation helps in audit preparedness and future reference.

Benefits of Efficient Payroll Management

Fast turnaround time for payroll processing.
End-to-end assistance throughout an employee’s lifecycle, from recruitment to exit.
Streamlined payroll operations, reducing administrative burden.
Optimized resource allocation, ensuring efficiency.
Compliance with statutory and tax regulations, preventing legal issues.
Accurate payroll records and reports, minimizing errors.

Why Choose TwinDesk Accounting and Legal Advisors LLP for Payroll Management?

At TwinDesk Accounting and Legal Advisors LLP, we provide top-notch payroll management services in India, offering cost-effective and reliable solutions tailored to your business needs. Our services include:

✔ Expert knowledge and experience in payroll management.
✔ High-quality professional service, ensuring accuracy and efficiency.
✔ Time-saving payroll processing, reducing manual workload.
✔ Precise payroll management, eliminating errors and inconsistencies.
✔ Secure and confidential handling of employee data.
✔ Customized payroll solutions to meet specific business requirements.

If you are searching for expert payroll management services in Delhi, feel free to contact us at:
📧 admin@twindeskllp.com
As one of the best payroll consultants in India, we are committed to delivering excellence and ensuring seamless payroll processing for your business.

CMA Data Preparation

A Credit Monitoring Arrangement (CMA) Report is a crucial financial document prepared for banks to evaluate a business's financial health. As businesses expand, securing funding becomes essential, and many rely on bank loans for growth. Since not every company can fund its expansion through retained earnings, creating debt through bank financing is often a preferred option—especially when interest rates are favorable.

For businesses seeking Cash Credit (CC) or Overdraft (OD) facilities, a CMA Report is a mandatory requirement. Banks prefer lending to businesses with strong financial standing, and before approving loans, they assess the borrower's repayment capacity. The CMA Report plays a vital role in this evaluation and is also required for increasing an existing credit limit.

Key Components of a CMA Report

A CMA Report is primarily based on financial statements and includes the following essential documents:

✔ Comparative financial statements for five years, including:
    - Last two years (Audited statements)
    - Current year (Provisional statements)
    - Next two years (Projected statements) with detailed assumptions
✔ Income Tax Returns (for both the business and its owners)
✔ Cost sheet of expenses
✔ Latest loan sanction letter (if applying for renewal or limit enhancement)
✔ Fund Flow Statement
✔ Ratio Analysis Report, including Gross Profit Ratio, Net Profit Ratio, Turnover Ratios, Current and Quick Ratios, and Debt-Equity Ratio
✔ Maximum Permissible Bank Finance (MPBF) Report

Additionally, the report includes:

General information about the borrower
SWOT analysis of the project
Industry standing of the company
Justification for funding requirements and utilization plans
For new projects, a detailed project report is also included.

Importance of Projected Financial Statements

Projected financial statements play a crucial role in securing a loan. Since loan repayment depends on future income, the projections must be accurate and realistic, taking into account both financial and non-financial factors that may impact business performance.

Role of Ratio Analysis in CMA Reports

Among all financial assessments, ratio analysis is the most critical part of CMA data preparation. Banks compare these ratios with their standard benchmarks to determine loan approval. The primary financial ratios evaluated include:

Gross Profit Ratio
Net Profit Ratio
Turnover Ratios
Current and Quick Ratio
Debt-Equity Ratio

If the ratios meet the bank’s ideal criteria, the loan is sanctioned; otherwise, it may be rejected or reduced.

Difference Between CMA Data and a Project Report

CMA Data	Project Report
Determines an entity’s borrowing capacity.	Evaluates a project’s viability and success potential.
Factors affecting it include time complexity, fund-related issues, and paperwork.	Influenced by risk management, project feasibility, and execution challenges.
Helps in analyzing assets, liabilities, and financial health.	Aims at risk identification, cost control, and project success.
Acts as a financial blueprint, ensuring effective fund utilization.	Tracks project progress and helps in identifying inefficiencies.
Includes financial statements, ratio analysis, fund flow, and operating reports.	Covers manufacturing process, resource needs, and pricing.
Submitted to banks and financial institutions.	Submitted to banks, venture capitalists, PE investors, and project funders.
More complex than a project report.	Easier to understand and prepare.

Why Choose TwinDesk Accounting and Legal Advisors LLP for CMA Data Preparation?

Preparing a CMA Report is a detailed and time-consuming task that requires financial expertise. Given the critical role it plays in loan approval, outsourcing this task to experienced professionals can maximize approval chances and ensure accuracy.

At TwinDesk Accounting and Legal Advisors LLP, we specialize in CMA Data Report preparation and are recognized as one of the best CMA Data consultants in Delhi. Our expert team ensures precise, structured, and bank-compliant CMA Reports that improve your chances of securing a business loan.

For professional CMA Data preparation services, contact us at:
📧 admin@twindeskllp.com
We are committed to providing highly accurate and presentable CMA Data Reports tailored to your business needs.

Item #3

Item #4

INCOME TAX COMPLIANCES

Corporate Tax Services – TwinDesk Accounting and Legal Advisors LLP

Corporate tax is a levy imposed on a company's profits by the government. The revenue collected from corporate taxes
serves as a significant source of national income. A company’s operating income is determined by deducting
expenses—such as the cost of goods sold, services procured, and depreciation—from its total revenue.
The applicable tax rates are then applied to establish the company’s tax liability.

Corporate Taxation in India

Corporate tax is applicable to both domestic and foreign companies. In India, the Income Tax Act, 1961 governs
corporate taxation.

Domestic Companies

These include businesses incorporated in India or foreign companies whose effective management and control are
entirely based in India. Companies registered under the Companies Act, 1956 or Companies Act, 2013 fall under this
category.

Foreign Companies

These are businesses that originate outside India and whose management and control are located beyond Indian
borders. For foreign companies, only the income earned or accrued in India is subject to taxation.

Helping Companies Reduce Taxable Income

Navigating the complexities of tax financial reporting, compliance, and strategic tax planning is crucial for
businesses. Companies often struggle to keep up with ever-evolving tax regulations and reporting requirements.

With in-depth industry expertise, TwinDesk Accounting and Legal Advisors LLP Corporate Tax Experts supplement
existing tax departments, ensuring financial accuracy, compliance, and peace of mind. Our approach is tailored to
meet the challenges of tax reporting, tax planning, and corporate tax accounting.

Why Choose TwinDesk Accounting and Legal Advisors LLP?

TwinDesk Accounting and Legal Advisors LLP is recognized as a leading corporate tax consultancy in Delhi, trusted for:

Deep industry knowledge across global and domestic markets
Risk assessment and regulatory compliance
Efficient and accurate tax strategies
Client-centric, customized tax solutions

Our Corporate Tax Services

Corporate tax compliance and return filing
Accounting for income taxes
Tax planning and advisory services
Audit support and due diligence
International tax planning

How We Deliver

Timely and compliant corporate tax filings
In-depth financial statement analysis
Innovative strategies for tax reduction and deferrals

Contact TwinDesk Accounting and Legal Advisors LLP

Looking for top corporate tax solutions in West Delhi? Reach out to
admin@twindeskllp.com and let our team of experts assist you with the finest corporate tax services.

Direct & Indirect Tax Services – TwinDesk Accounting and Legal Advisors LLP

In India, the tax structure is divided into two categories: Direct Tax and Indirect Tax. Understanding the distinction
between them is crucial for businesses and individuals alike.

Direct Tax: Levied on the income earned by individuals and corporate entities, where the taxpayer
directly bears the burden.

Indirect Tax: Imposed on the sale of goods and services, with businesses responsible for collecting
and depositing the tax. However, the final tax burden is passed on to consumers.

Both the Central and State Governments levy significant taxes, while Local Authorities such as municipalities also
have the power to impose certain taxes and charges within their jurisdictions.

Over the years, tax reforms have been introduced to simplify compliance, enhance transparency, and promote ease of
doing business. One of the most significant reforms has been the introduction of Goods and Services Tax (GST), which
eliminated cascading taxes and streamlined indirect tax systems in India.

As a trusted firm of Chartered Accountants, TwinDesk Accounting and Legal Advisors LLP specializes in tax
consultancy, helping businesses and individuals meet compliance requirements efficiently. Our team of tax experts
possesses the technical expertise and analytical skills required for tax planning, administration, documentation,
and legal representations.

Domestic Taxation

Domestic taxation serves as the primary revenue source for the government, with key components including:

Income Tax – Levied on individual and corporate earnings.
Goods & Services Tax (GST) – Applied to the sale of goods and services.
Property Taxes – Imposed on real estate assets.

Direct Tax Services

Tax laws are evolving, making it crucial for businesses to stay updated with compliance requirements to avoid
penalties. A tax-efficient structure can help businesses mitigate financial risks while ensuring regulatory
compliance.

Personal Tax Services

Individuals are required to pay taxes on their earnings. TwinDesk Accounting and Legal Advisors LLP specializes in:

Filing personal tax returns, advance tax, and withholding tax.
Handling taxation for High Net Worth Individuals (HNIs).
Assisting NRIs with tax filing and registrations (e.g., PAN, FRRO).
Helping clients claim income tax refunds for deceased taxpayers.

Corporate Tax Services

Corporate tax is levied on profits earned by registered companies. Our services include:

Filing corporate tax returns and tax audit reports.
Corporate tax planning and compliance.
Providing legal opinions and tax representations.
Assisting with capital gain calculations and tax litigations.

Our Direct Tax Services Cover

Tax Planning & Advisory
Income Tax Return Filings
Handling Income Tax Scrutiny Assessments
Representations before Tax Authorities
Advance Tax & TDS Payments
Filing Tax Audit Reports & Tax Appeals

Indirect Tax Services

Effective tax compliance strategies help businesses avoid risks associated with indirect taxes. TwinDesk Accounting
and Legal Advisors LLP offers professional guidance for:

GST Registration & Filing – Assistance in tax filings, refunds, and compliance.
Service Tax, VAT, CST, and Excise Duty Advisory.
Customs Compliance & Indirect Tax Opinions.

Tax Litigation & Representation Services

Tax assessments and legal disputes often arise due to incomplete or incorrect filings. The tax authorities issue
scrutiny notices, requiring legal representation and expert handling. TwinDesk Accounting and Legal Advisors LLP
provides:

Income Tax & Transfer Pricing Assessments.
Representation before Company Law Board and Registrar of Companies (ROC).
Income Tax Appeals before CIT(A) & ITAT.
Responding to tax notices and processing tax refunds.
GST-related representations and compliance support.

International Taxation

The rise of multinational enterprises and foreign direct investment (FDI) in India has led to increased
international taxation complexities. TwinDesk Accounting and Legal Advisors LLP offers specialized services in:

Transfer Pricing & Tax Advisory for cross-border transactions.
Foreign Inward Remittance Certificates (FIRC) Assistance.
Business Formation & Setup in India for foreign entities.
Setting up Branches, Liaison Offices, and Permanent Establishments.
NRI Tax Filing & Compliance.
Foreign Direct Investment (FDI) Assistance.
Repatriation of Funds & Equalization Levy Compliance.

Why Choose TwinDesk Accounting and Legal Advisors LLP?

Expertise & Accuracy – Extensive experience in direct, indirect, and international taxation.
Personalized Solutions – Tailored tax strategies to maximize compliance and minimize liabilities.
Trusted Advisors – Representing clients before tax authorities with proven success.
End-to-End Support – From tax planning to audits, appeals, and litigations.

Contact TwinDesk Accounting and Legal Advisors LLP

For direct or indirect tax solutions, corporate taxation, or international tax services, reach out to
admin@twindeskllp.com. Our expert professionals will guide you with precision and commitment in all
tax-related matters.

ITR Filing Services – TwinDesk Accounting and Legal Advisors LLP

Introduction

Seeking a best CA near me for ITR filing? TwinDesk Accounting and Legal Advisors LLP is the best choice for you if you are looking for the right team that could facilitate you with hassle-free and correct Income Tax Return (ITR) filings.

Our highly skilled chartered accountants in Delhi offer full-cycle tax return services to individuals, professionals, and corporate taxpayers, ensuring full compliance with all updated tax regulations.

Why Choose TwinDesk Accounting and Legal Advisors LLP for ITR Filing?

The ITR filing process should be done properly to prevent fines and increase tax deductions. Therefore, we should be your preferred service provider:

Expert CA Services – Experienced tax professionals providing exceptional client support.
Error-Free ITR Filing – Accurate calculation and timely submission with nil errors.
Maximize Tax Savings – Correct deductions and exemptions to minimize tax obligations.
Quick & Hassle-Free Process – Reduced paperwork and automated processes.
Affordable Pricing – Transparent and competitive pricing for all services.

Our Income Tax Return Filing Services

With TwinDesk Accounting and Legal Advisors LLP, we deliver personalized ITR filing services that go beyond your financial parameters.

ITR Filing for Salaried Individuals

Assistance in tax planning and exemptions to secure maximum refunds.
Consolidation of income from salary, rentals, investments, and other sources.
Form 16-based tax filing support.

ITR Filing for Business Owners & Professionals

Tax computation for freelancers, consultants, self-employed professionals, and businesses.
ITR filing under presumptive taxation (Sections 44AD, 44ADA, etc.).
GST-compliant return filing for businesses.

ITR Filing for Senior Citizens & NRIs

Support for retirees earning income from pensions and fixed deposits.
NRI tax return filing for global income and double taxation relief.
Capital gains tax calculation and compliance.

ITR Filing for Corporates & Startups

Corporate tax compliance and income tax return filing.
Tax audits and preparation of financial statements.
Tax-saving strategies for startups and growing businesses.

Benefits of Hiring a Professional for ITR Filing

Engaging a chartered accountant near you for ITR filing ensures compliance and accuracy. Here’s how we help:

Tax Notices Kept Away – Proper filing minimizes errors and penalties.
Increased Tax Refunds – Identification of deductions and exemptions.
Fast Processing – Timely filing before statutory deadlines.
Specialist Guidance – Expert advice on tax planning and investments.

How to Start?

Getting started with TwinDesk Accounting and Legal Advisors LLP is simple:

Arrange a Counseling Session – Contact us via phone or email to discuss your requirements.
Submit Required Documents – Form 16, bank statements, investment proofs, etc.
ITR Preparation & Review – Tax computation, preparation, and expert review.
Filing & Acknowledgment – Return filing followed by acknowledgment sharing.

Contact TwinDesk Accounting and Legal Advisors LLP

For ITR filing near you and a hassle-free, expert Income Tax Return filing experience, get in touch with TwinDesk Accounting and Legal Advisors LLP today.

We take the hassle out of your tax filing – always choose the best CA near you for ITR filing.

Faceless Assessment Scheme – TwinDesk Accounting and Legal Advisors LLP

Background

Section 143(3A) / (3B) / (3C) of the Income Tax Act, 1961 vests power in the Central Government to make a scheme by notification to enhance efficiency, transparency, and accountability in income tax assessment. This scheme covers the assessment of Income Tax under Section 143(3) or Section 144 of the Income Tax Act, 1961. Section 143(3A) of the Act authorizes the formulation of the scheme with the following objectives:

Eliminating the interface between the assessing officer and assessee to the extent technologically feasible.
Optimizing the utilization of resources through economies of scale and functional specialization.
Introducing a team-based assessment with dynamic jurisdiction.

By virtue of Section 143(3A) of the Act, the Central Government notified the E-Assessment Scheme, 2019 vide Notification No. 61/2019 dated September 12, 2019. On October 7, 2019, the E-Assessment Scheme was officially launched with the inauguration of the National E-Assessment Centre (NEC). However, many assessments remained outside the purview of the E-Assessment Scheme, leading to continued interactions between department officers and assessees. To address these shortcomings, the government amended the scheme and introduced the Faceless Assessment Scheme vide Notification No. 60/2020 dated August 13, 2020. The CBDT (Central Board of Direct Taxes) further notified the Faceless Appeals Scheme, prescribing a detailed procedure for conducting appeals in a centralized and automated manner. Appeals were assigned to an Appeal Unit (AU) in any Regional Faceless Appeal Centre (RFAC) through an automated selection process, and all communication took place via the National Faceless Appeal Centre (NFAC).

Procedure for Assessment

The assessment under the Faceless Assessment Scheme follows the procedure below:

Issuance of Notice

The National E-Assessment Centre (NEC) serves a notice under Section 143(2) specifying issues for selection.
The taxpayer must respond within 15 days of receiving the notice.

Case Assignment

NEC assigns the case to an Assessment Unit (AU) in any Regional E-Assessment Centre (REC) through an automated allocation system.

Requests by the Assessment Unit

Additional information, documents, or evidence from the taxpayer or other persons.
Verification or inquiry by a Verification Unit (VU).
Technical assistance from a Technical Unit (TU).

Processing of Requests

NEC issues notices for additional documents or evidence.
Verification tasks are assigned to the Verification Unit.
Technical matters are assigned to the Technical Unit.

Draft Assessment Order

Accepting the taxpayer’s declared income, or
Modifying the taxpayer’s declared income.

The Assessment Unit submits the draft order to NEC along with details of any penalty proceedings.

Review and Finalization

NEC may finalize the assessment and issue demand notice.
Provide an opportunity of being heard to the taxpayer.
Send the draft order to a Review Unit (RU).

The Review Unit may approve or suggest modifications. The Assessment Unit considers the suggestions and submits the final draft to NEC for completion.

Response and Completion

Taxpayer may respond to show-cause notices within the specified time.
If no response is received, NEC finalizes the assessment.
If response is received, a revised draft order is prepared.

Post-Assessment Processing

NEC transfers electronic records to the Jurisdictional Assessing Officer for:

Penalty proceedings
Demand recovery
Rectification of mistakes
Giving effect to appellate orders
Remand reports and prosecution sanctions

Procedure for Penalty

Any unit may recommend penalty proceedings.
NEC issues a show-cause notice.
Draft penalty order is prepared or proceedings are dropped.
NEC issues the final penalty order.

Procedure for Appeal

If the taxpayer disagrees with the assessment order, an appeal can be filed before the Commissioner (Appeals) having jurisdiction over the Assessing Officer.

Communication and Electronic Records

All communications are conducted electronically.
Notices are sent via registered account, email, and mobile app notifications.

Appearance of Taxpayer

No physical appearance is required.
Electronic submissions and video conferencing hearings are allowed.
Income-tax authorities may examine taxpayers via video conferencing.

Power to Specify Processes and Procedures

The Principal Chief Commissioner or Principal Director General of NEC specifies procedures for:

Service of notices and orders
Receipt and acknowledgment of responses
Status tracking of e-proceedings
Electronic record storage and retrieval
Grievance redressal mechanisms

TwinDesk Accounting and Legal Advisors LLP Comments

The Faceless Assessment Scheme is a landmark initiative that significantly reduces direct interaction between taxpayers and the Income Tax Department. It ensures faster resolution of cases while reinforcing transparency and trust in the tax system. If you are facing issues with the Income Tax Department, feel free to contact us at admit@twindeskllp.com

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