Income tax benefits for Start-ups
Recognised start-ups for tax benefits
Tax planning thoughts
Importance of statutory compliances
Impact of GST
Significance of Accounting
Accounting of Intellectual Property Rights (IPs)
Role of Chartered Accountants
India Companies Act 2013: Beginning of a new eraEY
Regulatory checks, accountability and governance standards in India have received a serious boost with the introduction of the new Companies Act 2013. Business and investors have expressed confidence in the Act’s ability to induce transparency and welcomed the legislation as an attempt to restore the appeal of Indian business. The Government of India introduced this landmark legislation in the beginning of fiscal year 2014.
This report focuses on some key topics in respect of which the 2013 Act and rules are notified. These topics are broadly classified into - financial reporting, audit and auditors, related party transactions, loans and investments, corporate social responsibility, corporate governance and mergers, amalgamations and reconstructions.
The SEBI (Substantial Acquisition of Shares and Takeovers) Circular dated 17 April, 2014, amended Clauses 35B and 49 of the Listing Agreement. The RC49, among other matters, deals with aspects such as related party transactions, independent directors, Audit Committee and vigil mechanism.
Though this publication focuses on the requirements of the 2013 Act in certain specific areas; to help listed companies better understand applicable framework; a brief overview of RC49 is also provided where relevant.
For further information, please visit: http://www.ey.com/companiesact2013
A
startup is a newly established business, usually small,
started by an individual or a group of individuals What
differentiates it from other new businesses is that a
startup offers a new product or service that is not being
given elsewhere in the same way
Practical Insights on implementation of Companies Act 2013.
Training opportunity, November – December 2014.
Learn more and register here: www.ey.com/ca2013training
The recently enacted Companies Act, 2013 (the Act), along with changes in the listing agreement marked a historic moment and beginning of a new era, which aims to improve transparency and accountability in India’s corporate sector.
The Act outlines various requirements for governance, disclosures and enhanced roles, responsibilities and liabilities of the board, its committees and independent directors.
Based on our experience of assisting several large Indian and multinational companies towards implementation of Companies Act 2013, we have faced several implementation challenges, which we believe are relevant for large number of companies in India.
A lucid and attractive presentation on the topic - "Ease of Doing Business in India". Discussion is done on both the basics as well as the nitty-gritty of the topic.
India Companies Act 2013: Beginning of a new eraEY
Regulatory checks, accountability and governance standards in India have received a serious boost with the introduction of the new Companies Act 2013. Business and investors have expressed confidence in the Act’s ability to induce transparency and welcomed the legislation as an attempt to restore the appeal of Indian business. The Government of India introduced this landmark legislation in the beginning of fiscal year 2014.
This report focuses on some key topics in respect of which the 2013 Act and rules are notified. These topics are broadly classified into - financial reporting, audit and auditors, related party transactions, loans and investments, corporate social responsibility, corporate governance and mergers, amalgamations and reconstructions.
The SEBI (Substantial Acquisition of Shares and Takeovers) Circular dated 17 April, 2014, amended Clauses 35B and 49 of the Listing Agreement. The RC49, among other matters, deals with aspects such as related party transactions, independent directors, Audit Committee and vigil mechanism.
Though this publication focuses on the requirements of the 2013 Act in certain specific areas; to help listed companies better understand applicable framework; a brief overview of RC49 is also provided where relevant.
For further information, please visit: http://www.ey.com/companiesact2013
A
startup is a newly established business, usually small,
started by an individual or a group of individuals What
differentiates it from other new businesses is that a
startup offers a new product or service that is not being
given elsewhere in the same way
Practical Insights on implementation of Companies Act 2013.
Training opportunity, November – December 2014.
Learn more and register here: www.ey.com/ca2013training
The recently enacted Companies Act, 2013 (the Act), along with changes in the listing agreement marked a historic moment and beginning of a new era, which aims to improve transparency and accountability in India’s corporate sector.
The Act outlines various requirements for governance, disclosures and enhanced roles, responsibilities and liabilities of the board, its committees and independent directors.
Based on our experience of assisting several large Indian and multinational companies towards implementation of Companies Act 2013, we have faced several implementation challenges, which we believe are relevant for large number of companies in India.
A lucid and attractive presentation on the topic - "Ease of Doing Business in India". Discussion is done on both the basics as well as the nitty-gritty of the topic.
The India Tax Insights quarterly (July-Sept issue) provides insights on the recently introduced Anti-avoidance rules and their impact on businesses in India. The issue traces the historical and colonial offshore tax avoidance in India and the UK, appropriateness of a GAAR (General Anti-Avoidance Rules) in India as a tool to combat tax avoidance in this issue, importance of interaction between GAAR and tax treaties and the need to ensure robust tax governance procedures for the effective implementation of GAAR.
Key Takeaways:
Common Issues in Transfer Pricing
Issues relating to Transactions and Specified Items
Issues relating to Comparable and Assesments
Issues arising pursuant to Covid-19
U.S. Gandhi Budget 2015 - 2016 AnalysisKunal Gandhi
Rarely has there been a budget as highly anticipated as this one.
Coming on the heels of the defeat of the ruling BJP in the recent Delhi elections, there were expectations that the original ‘Maximum governance, minimum government’ model would give place to a more populist agenda.
India Inc on the other hand expected improving the ease of doing business and a more rational tax regime.
While Corporate tax was lowered and Wealth tax was abolished, a major theme in the budget was creating a social security framework. Targeting a GDP growth rate of 8 – 8.5%, the budget plans to keep the deficit to within 3.9% of GDP by laying special emphasis on infrastructure development with a major spend budgeted on Road building.
All in all, though there were no big bang reforms, the budget 2015 was a good mix of Pragmatism and Populism. We are optimistic about growth and believe a lot more reforms are expected in the coming 3 years.
“The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn.”- attached today's newsletter 07.08.2020. Have a great day ahead.
What are the important measures taken by SEBI in response to COVID-19?DVSResearchFoundatio
Key Takeaways:
Relaxations from disclosure requirements
Relaxations for fundraising
Relaxations from compliance norms
Relaxations from regulatory compliances and other measures
Greetings
Union budget for FY 2018-19 was presented by Hon'ble Finance Minister Shri. Arun Jaitely . As most of you are aware, this budget is unique being presented before election in 2019
The document describes the ease of doing business in India. It discusses the factor used for calculating ease of doing business index. It also mentions about the regulations restricting the ease of doing business in India and the way forward to improve the same.
Quotient of ease of doing business in India i.e. assessing the hurdles businesses face and the procedures that have to be followed while doing business in India.
Budget 2012 Crisp analysis of Income tax provisions by Blue ConsultingChandan Goyal
A whitepaper on Income Tax Provisions in Union Budget 2012- with greater depth, so you could assess the impact of proposed taxation provisions with greater ease.
The format has been designed keeping in mind your reading convenience.
Relevant Sections and the dates of applicability have been mentioned for each taxation provision
Watch out this space for detailed analysis of Service Tax provisions.
Regards,
Chandan Goyal
This ppt was presented at WIRC Annual Regional Conference, 2016 held at Indore. In this presentation, discussion was held mainly in context of how Company Secretaries have contributed to the growth of startups since ages and also dealt with Startup India initiative of the Govt. of India and Key aspects of CSR in context of company secretaries.
Talk @NSRCEL - Benefits of MSME & DPIIT registration for startups SharadaSC
NITI Aayog has mandated MSME & DPIIT registration for all startups. I had the opportunity to conduct a workshop @ NSRCEL, IIMB to help entrepreneurs understand how to get themselves registered on MSME & DPIIT portals. Talk also covers benefits of registration under Companies Act, FEMA, Income Tax Act, MSME Act, pointers to GOI stimulus package & other IP and procurement benefits available. Why register unless you know what is in it for you as a startup ?
The India Tax Insights quarterly (July-Sept issue) provides insights on the recently introduced Anti-avoidance rules and their impact on businesses in India. The issue traces the historical and colonial offshore tax avoidance in India and the UK, appropriateness of a GAAR (General Anti-Avoidance Rules) in India as a tool to combat tax avoidance in this issue, importance of interaction between GAAR and tax treaties and the need to ensure robust tax governance procedures for the effective implementation of GAAR.
Key Takeaways:
Common Issues in Transfer Pricing
Issues relating to Transactions and Specified Items
Issues relating to Comparable and Assesments
Issues arising pursuant to Covid-19
U.S. Gandhi Budget 2015 - 2016 AnalysisKunal Gandhi
Rarely has there been a budget as highly anticipated as this one.
Coming on the heels of the defeat of the ruling BJP in the recent Delhi elections, there were expectations that the original ‘Maximum governance, minimum government’ model would give place to a more populist agenda.
India Inc on the other hand expected improving the ease of doing business and a more rational tax regime.
While Corporate tax was lowered and Wealth tax was abolished, a major theme in the budget was creating a social security framework. Targeting a GDP growth rate of 8 – 8.5%, the budget plans to keep the deficit to within 3.9% of GDP by laying special emphasis on infrastructure development with a major spend budgeted on Road building.
All in all, though there were no big bang reforms, the budget 2015 was a good mix of Pragmatism and Populism. We are optimistic about growth and believe a lot more reforms are expected in the coming 3 years.
“The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn.”- attached today's newsletter 07.08.2020. Have a great day ahead.
What are the important measures taken by SEBI in response to COVID-19?DVSResearchFoundatio
Key Takeaways:
Relaxations from disclosure requirements
Relaxations for fundraising
Relaxations from compliance norms
Relaxations from regulatory compliances and other measures
Greetings
Union budget for FY 2018-19 was presented by Hon'ble Finance Minister Shri. Arun Jaitely . As most of you are aware, this budget is unique being presented before election in 2019
The document describes the ease of doing business in India. It discusses the factor used for calculating ease of doing business index. It also mentions about the regulations restricting the ease of doing business in India and the way forward to improve the same.
Quotient of ease of doing business in India i.e. assessing the hurdles businesses face and the procedures that have to be followed while doing business in India.
Budget 2012 Crisp analysis of Income tax provisions by Blue ConsultingChandan Goyal
A whitepaper on Income Tax Provisions in Union Budget 2012- with greater depth, so you could assess the impact of proposed taxation provisions with greater ease.
The format has been designed keeping in mind your reading convenience.
Relevant Sections and the dates of applicability have been mentioned for each taxation provision
Watch out this space for detailed analysis of Service Tax provisions.
Regards,
Chandan Goyal
This ppt was presented at WIRC Annual Regional Conference, 2016 held at Indore. In this presentation, discussion was held mainly in context of how Company Secretaries have contributed to the growth of startups since ages and also dealt with Startup India initiative of the Govt. of India and Key aspects of CSR in context of company secretaries.
Talk @NSRCEL - Benefits of MSME & DPIIT registration for startups SharadaSC
NITI Aayog has mandated MSME & DPIIT registration for all startups. I had the opportunity to conduct a workshop @ NSRCEL, IIMB to help entrepreneurs understand how to get themselves registered on MSME & DPIIT portals. Talk also covers benefits of registration under Companies Act, FEMA, Income Tax Act, MSME Act, pointers to GOI stimulus package & other IP and procurement benefits available. Why register unless you know what is in it for you as a startup ?
Every Details related to the Startup India ,Modi Action Plane,Latest Startup Report by government,Important points,eligible legal entity,inter ministerial board, startup that is considered eligible,Funding Related questions, top flourishing cities, most profitable type of small businesses and their net profit margins, startups that are changing the face of virtual reality in India,benefit, anylysis
Newsletter on daily professional updates- 17/01/2020CA PRADEEP GOYAL
Be a lifelong student.
The more you learn, the more you earn
and the more self-confidence you will have
Here is your Daily dose of professional updates 17.01.2020
ASC - Classification of micro small and medium enterprises (MSME) registratio...ASC Group
The micro small and medium enterprises (MSMEs) have been accepted as the engine of economic growth and for promoting equitable development. The MSMEs constitute over 90% of total enterprises in most of the economies and are credited with generating the highest rates of employment growth and account for major share of industrial production and exports. We have prepared a small presentation on MSME classification, benefits, compliances and special economic package provided to MSME by Government of India in Covid-19.
Similar to KSCAA BCAJ Start-up Conference - Tax and accounting for startups (20)
CBDT’s stringent action-points to reactivate local grievance committees on hi...Sandeep Jhunjhunwala
CBDT’s stringent action-points to reactivate local grievance committees on high-pitched assessments and increase in threshold monetary limits for filing Departmental Appeals: Are these anti-tax-terrorism directorates to ease taxpayer distress?
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
Competitive Interest Rates: These loans often come with lower interest rates compared to conventional loans.
Flexible Credit Requirements: USDA loans have more lenient credit score requirements, helping those with less-than-perfect credit.
Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
Processing and Approval: The lender and USDA will review your application. If approved, you can proceed to closing.
USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
How to get verified on Coinbase Account?_.docxBuy bitget
t's important to note that buying verified Coinbase accounts is not recommended and may violate Coinbase's terms of service. Instead of searching to "buy verified Coinbase accounts," follow the proper steps to verify your own account to ensure compliance and security.
BYD SWOT Analysis and In-Depth Insights 2024.pptxmikemetalprod
Indepth analysis of the BYD 2024
BYD (Build Your Dreams) is a Chinese automaker and battery manufacturer that has snowballed over the past two decades to become a significant player in electric vehicles and global clean energy technology.
This SWOT analysis examines BYD's strengths, weaknesses, opportunities, and threats as it competes in the fast-changing automotive and energy storage industries.
Founded in 1995 and headquartered in Shenzhen, BYD started as a battery company before expanding into automobiles in the early 2000s.
Initially manufacturing gasoline-powered vehicles, BYD focused on plug-in hybrid and fully electric vehicles, leveraging its expertise in battery technology.
Today, BYD is the world’s largest electric vehicle manufacturer, delivering over 1.2 million electric cars globally. The company also produces electric buses, trucks, forklifts, and rail transit.
On the energy side, BYD is a major supplier of rechargeable batteries for cell phones, laptops, electric vehicles, and energy storage systems.
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
Financial Assets: Debit vs Equity Securities.pptxWrito-Finance
financial assets represent claim for future benefit or cash. Financial assets are formed by establishing contracts between participants. These financial assets are used for collection of huge amounts of money for business purposes.
Two major Types: Debt Securities and Equity Securities.
Debt Securities are Also known as fixed-income securities or instruments. The type of assets is formed by establishing contracts between investor and issuer of the asset.
• The first type of Debit securities is BONDS. Bonds are issued by corporations and government (both local and national government).
• The second important type of Debit security is NOTES. Apart from similarities associated with notes and bonds, notes have shorter term maturity.
• The 3rd important type of Debit security is TRESURY BILLS. These securities have short-term ranging from three months, six months, and one year. Issuer of such securities are governments.
• Above discussed debit securities are mostly issued by governments and corporations. CERTIFICATE OF DEPOSITS CDs are issued by Banks and Financial Institutions. Risk factor associated with CDs gets reduced when issued by reputable institutions or Banks.
Following are the risk attached with debt securities: Credit risk, interest rate risk and currency risk
There are no fixed maturity dates in such securities, and asset’s value is determined by company’s performance. There are two major types of equity securities: common stock and preferred stock.
Common Stock: These are simple equity securities and bear no complexities which the preferred stock bears. Holders of such securities or instrument have the voting rights when it comes to select the company’s board of director or the business decisions to be made.
Preferred Stock: Preferred stocks are sometime referred to as hybrid securities, because it contains elements of both debit security and equity security. Preferred stock confers ownership rights to security holder that is why it is equity instrument
<a href="https://www.writofinance.com/equity-securities-features-types-risk/" >Equity securities </a> as a whole is used for capital funding for companies. Companies have multiple expenses to cover. Potential growth of company is required in competitive market. So, these securities are used for capital generation, and then uses it for company’s growth.
Concluding remarks
Both are employed in business. Businesses are often established through debit securities, then what is the need for equity securities. Companies have to cover multiple expenses and expansion of business. They can also use equity instruments for repayment of debits. So, there are multiple uses for securities. As an investor, you need tools for analysis. Investment decisions are made by carefully analyzing the market. For better analysis of the stock market, investors often employ financial analysis of companies.
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
KSCAA BCAJ Start-up Conference - Tax and accounting for startups
1. Karnataka State Chartered Accountants Association & Bombay
Chartered Accountants' Society: Start-up Conference
Session 4: Accounting and Taxation for Start-ups
December 2, 2017
Presented by: Sandeep Jhunjhunwala, FCA
2. Contents
Summary
Content
Annexures
Income tax benefits for Start-ups
Recognised start-ups for tax benefits
Tax planning thoughts
Importance of statutory compliances
Impact of GST
Significance of Accounting
Accounting of Intellectual Property Rights (IPs)
Role of Chartered Accountants
Presentation Overview
Summary
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
4. Contents
Summary
Content
Annexures
Content
What is Start-up?
Start-up India Action Plan
• An entity [Private Limited Company/ Registered
Partnership Firm/ Limited Liability Partnership]
incorporated or registered in India
• Not prior to 7 years (10 years for startups in
biotechnology sector)
• With annual turnover < INR 25 crore in any
preceding financial year
• Working towards innovation, development,
deployment or commercialization of new products,
processes or services or if it is scalable business
model with high potential of employment
generation or wealth creation
• Subject to certain reconstruction provisions
Income Tax Act, 1961
• Incorporated/ registered as Private Limited
Company/ Limited Liability Partnership
• Incorporation: April 1, 2016 – April 1, 2019
• Annual turnover < INR 25 crores for 5 years from
FY 2016-17 to FY 2020-21
• Working towards innovation, development or
improvement of products or processes or services,
or should be a scalable business model with a
high potential of employment generation or
wealth creation
• Holds certificate from the Inter-Ministerial Board
(IMB) as constituted by the Department of Industrial
Policy and Promotion (DIPP)
• Subject to certain reconstruction provisions
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
5. Contents
Summary
Content
Annexures
Content
Innovation a must for tax benefits
Recognising the need to encourage innovation in India, innovativeness to be considered from a domestic
standpoint
A mere act of developing:
- Products/ services/ processes which do not have potential for commercialization, or
- Undifferentiated products/ services/ processes
- Products/ services/ processes with no or limited incremental value for customers or workflow
would not make a Start-up eligible for tax benefits
Subsequently, if recognition is found to have been obtained on the basis of false information, DIPP reserves the
right to revoke the recognition certificate and certificate of an eligible business for tax benefits immediately without
any prior notice or reason
~75 start-ups approved so for by the IMB for availing tax benefits*
~4,600 start-ups have been recognised by DIPP so far*
*As per Status Report dated available on https://www.startupindia.gov.in/status.php (updated till 20th meeting of IMB)
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
7. Contents
Summary
Content
Annexures
Content
Few recognised start-ups for tax benefits
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
Eunimart Multichannel Pvt Ltd Neomotive Assistive Solutions MCSSAN iTech Co
LEDchip Indus Pvt Ltd Nanoclean Global Pvt Ltd Streak Helmets Pvt Ltd
Predible Health Invento Makerspaces Delectrik Systems Pvt Ltd
Autonomous Logistics Tech Pvt Ltd AESOP Designs OPC Pvt Ltd Cerebroz Edutree LLP
Vizara Technologies Pvt Ltd Sindhanai Artificial Intelligene Pvt Ltd LYNK Ambupod Pvt Ltd
Ethereal Machines Pvt Ltd Alacris R&D Pvt Ltd Sheveer Intech LLP
VirtSpaces Pvt Ltd Vasitars Pvt Ltd Jarsh Innovations Pvt Ltd
Thirdwatch Data Pvt Ltd Indira Astron Drive Happy Adda Studios Pvt Ltd
Meladath Auto Components Taimed Hygiene Pvt Ltd Vortex Solar Energy Pvt Ltd
*As per Status Report available on https://www.startupindia.gov.in (updated till 20th meeting of IMB)
8. Contents
Summary
Content
Annexures
Content
Income tax benefits for recognised startups
Section 80-IAC: 100 percent of profits will be exempted from tax for consecutive 3 out of 7 years (under normal
tax provisions) - Minimum Alternate Tax (MAT)/ Alternate Minimum Tax (AMT)* provisions continue to apply - rate
of 18.5 percent on book profits, along with applicable surcharge and cess (in case of profit making ventures)
- Effective tax payout - 20.388 percent/ 21.341 percent - MAT/ AMT scenario
- Tax holiday provisions do not provide a corresponding relief from TDS provisions (clients/ customers of
start-ups would deduct tax at source on payments to be made to such start-ups, which needs to be claimed
as refund) - Certificate of Nil withholding under Section 197 of the IT Act to avoid working capital block?
- By exempting profits from tax, start-ups may perhaps not be eligible to carry forward any tax losses made
Section 79(b): Restriction of 51 percent shareholding of company to remain unchanged in order to carry forward
and set-off the loss of earlier years relaxed in the case of startups
- Original promoter(s) must be on board – Continue to hold "those shares“
- Angel investors (non-promoter) selling shares in second round of funding by a VC or PE investor?
Section 56(2)(viib) [Angel investment tax]: Any amount received from a resident person by a eligible startup
exceeding the face value for issue of shares are not covered
Section 54EE/ 54GB: Capital gains tax exemption for investment in eligible start-ups/ funds, subject to specified
conditions (benefits under Section 54, 54B, 54D, 54F, 54EC, 54G, 54GA available to all assesses)
*At times it may happen that a taxpayer may have generated income during the year, but by taking the advantage of various provisions of Income-tax law (like exemptions, deductions,
depreciation etc), it may have reduced its tax liability or may not have paid any tax at all. Due to increase in the number of zero tax paying companies, MAT was introduced by the
Finance Act, 1987 with effect from Assessment Year 1988-89. Later on, it was withdrawn by the Finance Act, 1990 and then reintroduced by Finance (No 2) Act, 1996, wef April 1,
1997. The objective of introduction of MAT is to bring into the tax net "zero tax companies" which in spite of having earned substantial book profits and having paid handsome dividends,
do not pay any tax due to various tax concessions and incentives provided under the Income-tax law. MAT applies to companies and AMT applies to a person other than a company.
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
9. Contents
Summary
Content
Annexures
Content
Tax Planning thoughts
Legal set-up (form of business entity) matters:
- Corporate structures facilitate carrying forward of business losses
- Dividend Distribution Tax not applicable for sole proprietorship, partnership firm and LLP (relevant for profit
making entities)
− Sole proprietorship is not liable to deduct TDS till it is liable for tax audit (Section 44AB of IT Act)
− In sole proprietorship form of business, business income could be declared on personal income tax form
− Tax deductions related to individual tax payer – life/ health insurance etc could be claimed under sole
proprietorship
− No personal liability protection in sole proprietorships and partnerships firms
− Conversion to a different entity form (LLP to PLC etc) possible, subject to certain conditions on tax neutrality
Generally, it is good to be a lean startup and gradually evolve business into corporate set up – Minimum viability of
product/ service (MVP) may be checked before registering for corporate set-ups (to avoid compliance costs and
even closure costs)
If feasible, make capital purchases + put to use, before September 30th to claim depreciation for the full year
Start-up expenses, alias preliminary expenses allowed as deduction under Section 35D of the IT Act
Home office related deductions (to a limited extent and only in compliance with the existing tax laws in India)
Patent Box benefits (Section 115BBF), lower tax for new manufacturing entities (Section 115BA) – with qualifying
conditions, benefits could be availed by few!
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
11. Contents
Summary
Content
Annexures
Content
Statutory Compliances
Transaction taxes
[Capital gains on
sale of shares to
investors, exit by
investors through
sale/ IPO,
reorganizations,
winding up etc]
Income tax
[Obtaining PAN
& TAN, Tax
Audit, Advance
tax, TDS, return
of TDS and
annual income]
Accounting and
Book-keeping
Importer
Exporter Code
Registration,
Exchange
Control
Regulations
Contract
Management,
Shops and
Establishment,
Professional
Tax, Labour
Laws (PF,
EDLI)
Companies Act
[Statutory Audit,
Board
Meetings,
Statutory
Registers,
Filings, XBRL]
Goods and
Services Tax
[Registrations,
Returns,
payment of
taxes,
maintenance of
credit pools]
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
12. Contents
Summary
Content
Annexures
Content
Importance of being compliant
Compliance and its importance is often overlooked by many startups new to the business ecosystem, simply
because they are not aware of existing laws
Ignorance is not an excuse that regulators will swallow
Ignorance may not be bliss in such cases as it affects a startup’s viability and attractiveness to a potential investor
Cost of compliances is lesser than the cost for non-compliances! Few instances below:
- Penalties for all tax/ secretarial non-compliances (filings etc) and interest for delayed payments
- Business loss could not be carried forward if return is not filed within statutory timelines
- Added interest under Section 234A of IT Act if return of income not filed within timelines
- Interest under Section 234B and 234C of the IT Act for default/ deferment in payment of advance tax
(relevant for profit making entities)
- Non-deduction/ Non-deposit of TDS on time could make expenses not deductible for income tax purposes
- Interest under Section 201of the IT Act for failure to deduct or pay TDS
- Disallowance of expenditure for cash payment exceeding INR 10,000 [Section 40A(3) of IT Act]
- 100 percent penalty on loans/ deposits taken/ paid in cash exceeding INR 20,000 [Section 269SS/ 269T]
- If e-TDS return is not submitted by the Deductor, then it is very difficult to get the credit for the amount
deducted from the Income Tax Department (please refer Tax credit statement in Form No 26AS)
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
13. Contents
Summary
Content
Annexures
Content
Importance of being compliant
No exemption that allows businesses with "No Revenue" to skip compliances
Even if a company is to be liquidated, compliances need to completed first
Non-compliant startups struggle at funding stages – Discounting on share valuation post due diligence
Banks/ Investors may not want to fund a non-compliant start-up
Participation in Government tenders could become a challenge
De-registration risks by the regulators [refer the recent crackdown on dormant and shell companies by the RoC]
Disqualification of Director by operation of law [recent action part of the Government crackdown on shell
companies] including prosecution risks
Tax/ Regulatory non-compliances could create issues later at a reorganization stage (mergers/ demergers etc) –
Requirement of NoC by Courts/ Tribunals from tax and regulatory authorities, delays due to compounding etc
Higher costs of regularizing non-compliances – Interest and Penalty + Prosecution risks (reputational risks)
Always good to berth the business in safe compliance harbor
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
14. Contents
Summary
Content
Annexures
Content
Few common mistakes
Forgetting Start-up costs
- Expenses you rack up before the business opens its doors are deductible (say, conducting market survey)
- Setting up vis-à-vis Commencement of Business (Section 3 of the IT Act)
- Rentals, mortagage, utilities or insurance
- Issue of prior period expenses (expenses later recalled cannot be booked in accounts)
Losing Receipts
- Can’t deduct what you can’t prove
- Keep good records (Digital or Physical) - few deductions such as Section 35D of IT Act could be availed
Not seeking Professional help
- Startups = Need lots of $$$ = No Finance/ Accounting Expert - This equation doesn't work in real-life!
- Getting finances in order is not Number-one priority - it’s usually about getting a great product out the door
- Laws/ Regulations are complex and not easy to comprehend
- Start-ups should invest in a compliance management system
- Later, compliance program could be scaled up to be growth-ready
- A second set of eyes, even if core team in a start-up is managing financial/ legal affairs
- Financial health isn’t only about dollar signs - Finance experts can help you execute a strategy
- Spending more time tackling financial matters, instead of using time to concentrate on business itself
- Having just a bookkeeper is way behind, its about thinking through a smart strategic plan
- Trusted advisors having financial wisdom and high-level perspective can steer the ship well and head off
mistakes before they happen (cracks could soon be crevasses)!
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
15. Contents
Summary
Content
Annexures
Content
Role of Chartered Accountants
KSCAA & BCAS - Startup
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December 2, 2017
Pre-Start-up
Planning
• Drawing up business plans before any revenues are earned
• Business planning that sets specific objectives in order to assess performance at later stages
• Choice of legal entity
• Entity set up paperwork
As business
begins in
earnest
• Enable business owner to focus on commercial direction of their business
• Focus on aligning business objectives related to shift from prototype to product
• Putting internal controls in place
• Helping entities meet its statutory objectives
• Making ready for fundraise (getting business records in shape for securing investment & credit)
• Banking relationship - A/R lines of credit, venture debt etc
Next stage
of
development
• Gather and process financial information to allow business optimise its internal processes
• Commercial and strategic decisions centered around growth
• Management Reporting, Business Planning
• Employee compensation (ESOP planning)
• Modelling burn rate, breakeven point, sales forecasts etc
• Assistance in fund raising process (navigating through due diligences, term sheets etc)
• Investor Management
16. Contents
Summary
Content
Annexures
Content
Impact of GST
KSCAA & BCAS - Startup
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Sandeep Jhunjhunwala
December 2, 2017
Higher threshold for registration
Startups (service sector) could
enjoy tax credit on purchases
Online/ Digitised procedures
(though evolving almost
everyday) - Idea is to move
towards "Do it yourself"
compliance model
Single tax (subsumes VAT,
Service tax, CST, Excise and
integrates into one)
Increased efficiency in logistics
Reduced compliance costs
(may not be reduced at initial
stages though)
The Good of
GST
Cross set off of levy not allowed
Increase Tax Rate (15 vis-à-vis
18 percent for service start-ups)
Increased documentation and
filing
Technological restrictions/
issues (at nascent stages)
No registration exemption for
small inter-state suppliers
Restrictive composition levy
scheme
Harsh Reverse charge
mechanism
Tax burden for manufacturing
startups
The Bad of
GST
Key Impact areas include - Sales and marketing (revisit pricing & margins, competitive benchmarking), Supply
chain (distribution network model, relook at manufacturing/ supply strategies), ERP Systems (implementing GST
solutions, new invoicing requirements), Finance and Accounting (CAPEX planning, change in business
processes, cash flow/ working capital impact)
18. Contents
Summary
Content
Annexures
Accounting Basics
Content Accounting cannot be considered as an overhead for business
Accounting is not only center point of every business decision, but also a base for all compliances
Good accounting gives a valuable insight into business
Helps with long-term planning
Saves money over the long-term
Potential investors require it
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
19. Contents
Summary
Content
Annexures
The Accounting Pillars
Content
Assets
Those items which you
paid for which will give you
benefit for more than 1
year are called assets.
Simple!
You buy a laptop, that’s an
asset. Will last 3/4 years
You buy a car, that’s an
asset. Will last 3/4 years
You buy a pen, that’s not an
asset. Will not last > 1 year
You buy a meal, that’s not an
asset. Will last 30 mins!
Expenditure
Items which you paid
money for, which are NOT
assets is expenditure
The laptop you bought is not
expenditure. It’s an asset
The car you bought is not
expenditure. It’s an asset
The pen you bought is
expenditure. It’s an not asset
The meal you bought is
expenditure. It’s an not asset
Liabilities
Money that you received
which you need to pay
back to someone at a
future point in time is a
liability
You purchased items from a
vendor on credit. That’s a
liability. After the credit
period, you need to pay the
vendor
You received Rs 150,000
from a customer. That’s not a
liability
You received Rs 5,000 from
the bank as interest. That’s
not a liability
Income
Money that you
received which you need
NOT pay back to someone
is income. You receive
income for services/
products you provide
You received Rs 150,000
from a customer. That’s an
income. The money is paid to
you for a service/ product
you provided. You don’t need
to give it back to the
customer. You’ve earned it!
You received Rs 5,000 from
the bank as interest. That’s
not a liability. The money is
paid to you for depositing
money in a bank. You need
not give it back to bank.
You’ve earned it.
Whether one is Apple Inc, Google or Facebook or running a tea stall, all the transactions would come under one of the 4
categories above!
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
20. Contents
Summary
Content
Annexures
Financial Statements
Content
Balance Sheet
• Picture
• Indicates the financial health of a company at a point in time
• Assets (Cash, AR, Inventory, Fixed Assets, Goodwill & intangible assets)
• Liabilities (Salaries, AP, deferred revenue, debt)
• Equity (Paid up capital, retained earnings)
Profit & Loss
Account
• Summary of Income & Expenditure
• A movie, tells the financial story of a company over a span of time
• All profit and loss statement would have a heading stating a period of time with a start date and an
end date
Cash Flow Statement
• Summary of Cash Inflow & Outflow
• This statement tracks the core activity money in for sale and money out to cover expenses
• Other Reports such as Cash Burn reports, Budget vs Actual Reporting
KSCAA & BCAS - Startup
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Sandeep Jhunjhunwala
December 2, 2017
21. Contents
Summary
Content
Annexures
Financial Fundamentals
Content
Bottom Line
=
Revenue -
COGS -
Expenses
Budgets, Projections,
Cash Burn
Top line
Revenue/ Sales
Gross Sales/
Revenue
regardless of
cost, liabilities
Bookings =
Financial value
of business that
you have under
contract
Revenue, COGS, Gross
Margins, expenses
Runway =
Cash divided by
cash burn, not
necessarily equal
EBITDA
Dashboards -
One Page to
communicate
progress to key
stakeholders
(investors,
employees, etc)
EBITDA: Earnings Before
Interest, Taxes,
Depreciation &
Amortization
Milestones -
Events that drive
value in the
company
(commercial,
market,
technical)KSCAA & BCAS - Startup
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Sandeep Jhunjhunwala
December 2, 2017
22. Contents
Summary
Content
Annexures
What do you need to think?
Content What are your costs? (money out)
What are your revenue streams? (money in)
How’s your cash burn?
What are your short-term financial goals?
What are your long-term financial goals?
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
23. Contents
Summary
Content
Annexures
Content
Accrual Based Accounting System
Accrual Basis Accounting
− Revenue recognized when earned
− Expenses recognized when incurred - matched to same period as related revenue
Cash Basis Accounting
− Revenue is recognized when cash is received
− Expense recognized when cash is paid
− Cash basis accounting system can produce a Profit & Loss but not a balance sheet
What’s missing in a cash basis system?
− Tracking money owed to you: unpaid invoices, daily merchant account activity, longer term holdbacks or
reserves
− Assets: Capitalized computers and equipment, other assets of the company
− Tracking money you owe others: Accounts Payable (unpaid bills), Revenue share due to partners
− Equity
KSCAA & BCAS - Startup
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Sandeep Jhunjhunwala
December 2, 2017
24. Contents
Summary
Content
Annexures
Content
Accounting Pre and post funding
Open business banking account
Separate personal and business expenses
Keep records of receipts and invoices
Be mindful of tax and regulatory obligations
Collect payments
Select payroll provider, if needed
Stay on top of records
Set up a low-cost, accrual-based accounting
structure that can grow with you
Set foundation for future growth
Build financial infrastructure
Clarify funding objectives
Manage cash-flow
Create clean financials for investors
Hire professionals to help company become
GAAP compliant (Generally Accepted
Accounting Principals)
Pre-fundingStage
Post-fundingStage
Your financial strategy deepens and you’ll gain
better understanding of your business
KSCAA & BCAS - Startup
Conference
Sandeep Jhunjhunwala
December 2, 2017
25. Contents
Summary
Content
Annexures
Content
Accounts Payable/ Receivable/ Taxes
KSCAA & BCAS - Startup
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Sandeep Jhunjhunwala
December 2, 2017
AccountsPayable
Set up system early to
help maximize cash flow
and create essential
financial reports
Choose best tracking
system for company
needs - Check invoices
Enter every expense:
receipts, bills, etc
Establish invoice AP
schedule
Place vendors on net 30
days' payment terms
Build reputation of
financial stability AccountsReceivables
List all open invoices
and balances
Create tax invoices as
required by GST laws
Put payment terms in
writing for new clients
Establish credit
guidelines
Create collection
timelines
Improve cash collections
by creating a clear
payment collection
process
TaxesandCompliances
Even in the early stages,
be mindful of tax
considerations
Select correct legal
entity/ business set-up
Understand all tax and
regulatory obligations
and filings
Separate business and
personal finances
26. Contents
Summary
Content
Annexures
Content
Accounting of Intellectual Property (IP)
Intellectual Property (IP) - a secret sauce for most businesses today, especially for tech centric businesses
Codes, algorithms and research findings - most common IPs owned by start-ups
Startups can leverage 'Scheme for Startups Intellectual Property Protection' (SIPP) under the Startup India
initiative
Guidance could be taken from Accounting Standard (AS) 26/ Indian Accounting Standard (Ind AS) 38
An entity could recognise an intangible asset if, and only if, specified criteria are met:
KSCAA & BCAS - Startup
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IDENTIFIABILITY
Either Separable
(capable of being
separated or divided
from the entity and sold,
transferred, licensed,
rented or exchanged OR
Arises from contractual
or other legal rights
regardless of whether
those rights are
transferable or
separable from the entity
or from other rights and
obligations
CONTROLOVER
RESOURCE
Power to obtain future
economic benefits
flowing from the
underlying resource and
to restrict the access of
others to those benefits
Would ‘normally’ stem
from legal rights that are
enforceable in a court of
law
FUTUREECONOMIC
BENEFITS
Revenue from sale of
products or services,
cost savings, or other
benefits resulting from
the use of the asset by
the entity
Using reasonable and
supportable
assumptions that
represent Management’s
best estimate of set of
economic conditions that
will exist over the useful
life of the asset
27. Contents
Summary
Content
Annexures
Content
Accounting of Intellectual Property (IP)
Internally generated goodwill not to be recognised as an asset - Not an identifiable resource (not separable nor
does it arise from contractual or other legal rights) controlled by the entity that can be measured reliably at cost
Expenditure on research (or on research phase of an internal project) to be recognised as an expense when it is
incurred - in research phase of an internal project, an entity cannot demonstrate that an intangible asset exists that
will generate probable future economic benefits
In the development phase of an internal project, an entity can, in some instances, identify an intangible asset and
demonstrate that the asset will generate probable future economic benefits
An intangible asset shall be measured initially at cost (directly attributable + overhead allocation)
Most subsequent expenditures are likely to maintain the expected future economic benefits embodied in an
existing intangible asset rather than meet the definition of an intangible asset and recognition criteria - cannot be
recognised in the carrying amount of an asset, but needs to be expensed off
Internally generated brands, mastheads, publishing titles, customer lists and items similar in substance
shall not be recognised as intangible assets
Concepts of Useful life, Amortisation period, Amortisation method, Residual value, Impairment losses,
Retirement and disposals etc
Section 32(1)(ii) of IT Act – Recognises know-how, patents, copyrights, trade marks, licenses, franchises or any
other business/ commercial rights of similar nature as intangible assets – eligible for depreciation @ 25 percent
KSCAA & BCAS - Startup
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December 2, 2017
28. OPEN HOUSE & DISCUSSIONS
THANK YOU
Sandeep Jhunjhunwala | FCA, ACS, LLB, B.Com (H)
E: Mailboxofsandeepj@gmail.com
M: +91 97401 55469
L: +91 80 6565 5469
The views in this presentation are personal views of the Presenter. The information contained is of a general nature and is not intended to address the circumstances of any particular
individual or entity. Although, the overall endeavor is to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that
it will continue to be accurate in the future. This presentation is meant for general guidance only and no responsibility for loss arising to any person/ entity acting or refraining from acting as a
result of any material contained in this presentation will be accepted. It is recommended that professional advice be sought based on the specific facts and circumstances. This presentation
does not substitute the need to refer to the original pronouncements.