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Tax Registration

Goods and Services Tax

India is considered to be an upcoming location for business ventures. With the number of young entrepreneurs and established business persons going all out to make a handsome profit from their endeavors across the length and breadth of the country, complying with the plethora of taxes to be paid becomes difficult as there are numerous service taxes to contend with direct as well as indirect. Dealing with all taxation requirements completely and to every one’s satisfaction is a tall order though.

Thankfully, the scenario is set to change completely come July 2017 with almost every single tax including VAT, excise duties as well as special custom levied duties about to be abolished once and for all and replaced by a single taxation system namely the ‘Goods and Services Tax’ known as GST.

Professional Tax

Professional tax is a direct tax levied on persons earning an income by either practicing a profession, employment, calling, or trade. Unlike income tax imposed by the Central Government, professional tax is levied by the government of a state or union territory in India.

In the case of salaried and wage earners, the professional tax is liable to be deducted by the Employer from the salary/wages, and the same is to be deposited to the state government.

In the case of other classes of individuals, this tax is liable to be paid by the employee himself. The tax calculation and amount collected may vary from one State to another, but it has a maximum limit of Rs. 2500/- per year.

Business Registration

MSME / Small Scale Industry

An enterprise shall be classified as a micro, small or medium enterprise on the basis of the following criteria, namely:

Investing Micro Enterprise

A micro enterprise, where the investment in plant and machinery or equipment does not exceed one crore rupees and turnover does not exceed five crore rupees.

Investing Small Enterprise

A small enterprise, where the investment in plant and machinery or equipment does not exceed ten crore rupees and turnover does not exceed fifty crore rupees.

Investing Medium Enterprise

A medium enterprise, where the investment in plant and machinery or equipment does not exceed fifty crore rupees and turnover does not exceed two hundred and fifty crore rupees.

Employee Provident Fund Organisation

EPFO or PF is an arrangement made by the government and managed by Employee’s Provident Fund Organization (EPFO), which is covered under the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952.

The EPF organization is controlled by Ministry of Labour and Employment, Government of India. The Act was framed to provide the benefits to salaried class employees.

Under this act, the employees are entitled to receive a pension, insurance or special benefits at specific occasions by contributing a nominal amount towards this fund. The contribution is being deposited from applicable for both employee and employer.

Benefits

Earlier this registration was being done manually by visiting the organization. But now it can be easily done online. An important investment plan for future needs has been made mandatory by the government for the employees drawing a basic salary less than Rs. 15000/-. The fund accumulated would be tax-free and if withdrawal is being made after 5 years of registration then the maturity amount with interest will also be treated as the tax-free income.

The contribution also helps employees by facilitating to withdrawal partial amount for expenses like house construction, daughter’s wedding, in the case of critical illness, higher education etc. Thus, it is very important to contribute towards this fund for both employer and employee.

PF Contribution

STEP ONE

12% of Basic Salary of Employee deposited directly towards EPF

STEP TWO

1.1% of contribution towards EPF Administration Charges ( After 01/04/2017 0.65% )

STEP THREE

0.5% of contribution towards Employees’ Deposit Linked Insurance ( minimum RS. 500/-)

STEP FOUR

0.01% of contribution towards EDLI Administration Charges( After01/04/2017 RS. 0/-)

Last date of EPF Payment

Deposition of EPF contributions due date is 15th of every month.

Employees State Insurance Corporation

ESIC Registration is applicable to the establishments which in an implemented area and having more than 10 employees. Once, the organization gets registered, a 17 digit unique identification code will be allotted to them. It is the statutory responsibility of the employer to get registered under this act after achieving the said employee level within 15 days.

Benefits

Provides complete medical assistance to the employee

It also includes dependents

These benefits can be availed at different ESI dispensaries, clinics and hospitals

Any payment made at hospital is completely reimbursable

ESI Contribution

ESIC contribution is must to be made by the employer for all employees drawing a monthly gross salary of up to Rs.21,000 per month. The employer contribution is 4.75% and employee contribution is 1.75% of the wages. The total contribution made towards ESI Fund will be 6.50% of total monthly gross.