How do India’s International Tax Policies align with the global tax reforms?

India’s tax policies are evolving to align with the International tax reforms and create a fair and competitive tax scenario.

Here is how India’s International Tax policies integrate with the global tax reforms-

• BEPS Action Plan: The Base Erosion and Profit Sharing (BEPS) framework initiated by G20 and OECD aims to curb tax avoidance by multinational corporations. The five BEPS recommendations are –

1. Equalization Levy- It taxes digital transactions from non-resident companies ensuring fair taxation of digital services.
2. Master File and Country-by-Country Reporting – To increase transparency in the financial reporting of multinational companies and reduce profit sharing to the low-tax jurisdictions.
3. Signatory of Multilateral Instruments- India signed the MLI to prevent tax treaty abuse and promote fair taxation.

• Pillar One and Pillar Two Taxation: The OECD two-pillar solution aims to revolutionize tax rules for the digital economy. The Pillar ensures that multinationals pay their taxes where they generate revenue rather than shifting profits to low-tax jurisdictions. The Significant Economic Presence rules to tax foreign digital businesses with significant user bases is introduced. Pillar two introduces a 15% global minimum corporate tax to prevent companies from shifting their profits to tax havens.
• Transfer Pricing Norms: The transfer pricing laws are according to the OECD norms to prevent tax avoidance by the MNCs. The key steps include ensuring the related party transactions with the MNCs are conducted at a fair market value. Pre-defined tax rates are provided for certain international transactions to reduce litigation. The advanced pricing agreements allow the companies to negotiate tax treatment of cross-border transactions, ensuring stability.
• Global Tax Cooperation: India actively participates in global tax discussions through the OECD G 20 inclusive framework on BEPS. Through automatic exchange of information agreements, India shares tax data with more than a hundred countries to curb tax evasion. The FATCA Agreement with the USA ensures transparency in financial transactions for Indian entities with US ties.
• Challenges: There are many challenges that still remain for India in aligning with the global tax reforms. The new tax rules may increase compliance burdens for MNCs. The equalization levy has faced resistance from the USA leading to trade tensions and finally, the implementation of the global minimum tax requires careful policy adjustments to protect India’s tax revenues.

India will continue refining its international tax policies to balance revenue collection, global tax fairness, and ease of doing business. With its ongoing tax reforms, the country is poised to remain an attractive investment destination while also ensuring fair taxation of global businesses.

Understanding the tax reforms is important and thus working with professional International tax services in India will help businesses understand how the tax reforms impact their business and help them make informed decisions.

Virtual CFO v/s Accounting Services: Understanding the key difference

Financial management is the most important aspect for every business. To handle the finances efficiently, it is imperative to hire professional finance services. Most businesses often get confused between the two options – Virtual CFO v/s Accounting services. 

Both Virtual CFO and Accountant play a significant role in the finance management, they cater to different needs and functions. Understanding difference between them can help your business make informed decisions about which service to use.

Tax consultant registration eligibility in India

Tax related matters take on nerve of every person. It is important to adhere to the tax norms and file tax returns in time so as to avoid penal charges from the income tax department.

It is important to hire an experienced and professional tax consultant in Delhi, to help you sail through the tax related matters in a hassle free manner. It is important for any business to be aware of tax norms and challenges that might lead to hefty penalties. A tax efficient structure for an entity helps in the smoother governance of the entity.

If you have the time and the inclination, you can prepare your own income taxes for submission. However, many people appreciate giving these tasks to qualified professionals so that they can rest assure themselves of adhering to all the tax formalities in a hassle free manner.

Here are some of the benefits of hiring an experienced tax consultant in Delhi:

1.       Expert assistance: With an expert tax professional working to complete your taxes, you can be rest assured that you will receive the best help and advice on tax matters. Professional tax experts with good experience in the industry can make recommendations that will often save consumers money.

2.       Complicated details: Some people have complicated tax returns for business or investment ventures. In such situations, hiring a good tax consultant helps managing tax formalities in a seamless way. The experienced tax professional will examine all your data, organize it properly and prepare the forms. The experience and the skill level of the tax expert make the process of filing ITR easier due to strong familiarity with the system.

3.       More tax rebates and deductions: An expert tax advisor will help you find all the deductions and rebates you can utilize. They will table money saving options using their in-depth tax knowledge.

4.       Make tax filing easy: A tax consultant tends to make your ITR easier as they are there for your help and queries every time. They are experts in the tax world and understand all the ins and outs of the tax structure. Even if you present them with a difficult situation, they are able to handle the situation much quicker for they are trained to do so. Hiring a tax consultant will grant you peace of mind knowing that your business taxes are filed flawlessly, in time and in a legal manner.

5.       Keep themselves update with tax laws: A tax consultant can make smallest changes in the tax laws and norms that help them to provide you with suggestions that will help you save tax money.

6.       Safe and hassle-free: It is always better to seek an expert advice on tax related matters so as to avoid huge penalties. A good tax consultant can maintain your tax records in the safe and legal manner without any need for you to run from pillar from post.

Hiring a professional tax expert will help you in tax planning and compliance and also help in filing your ITR accurately and in time.

An analysis of the startups for raising money

Every organization has to raise funds for the conduct of their business in a smooth and hassle free manner. Funds are also required for the survival, success and growth of the business entity. Just like all the business organizations startups also require to raise money for transpiring their dream venture into reality.

Here are some of the fundraising platforms for startups that help them to raise funds for their business:

Banks: Banks help the startups to raise funds by offering loans at comparatively low interest rates. Banks offer either collateral or non collateral loans to the startups and help them in funneling funds in their venture. Startup owners need to give the blue print of their project and their work details to the banks on which they provide required loans to them.

Non banking financial institutions (NBFCs): Those individuals who are not able to get loans from the banks because of certain issues, NBFCs come to their rescue. These are non banking institutions that provide loans to the startups at the high interest rate. They provide loans against the security pledged with them.

Crowd funding: This is one of the most sought after fund raising platforms for startups. It is the practice of funding the project or venture by raising small amounts of money from a large number of people online. This approach taps the group efforts of the large pool of individuals mainly online via social and helps the startups to gather funds for their venture.

Angel investors: They are the private investors with a high net worth and have the capacity to provide startups with a required finance for their venture. They are highly beneficial for the startups that require funds at the early stage of their business. They provide a one -time investment to aid the business entities get off the ground and support them to carry them off at their early stages.

Incubators: An incubator firm is an organization that help the startup to kick start their venture. They help to grow the startups from the early stage idea to a company that can stand its own. They help the startup ventures with funds and provide them with space, mentor them and train them in carrying out the venture in a seamless manner.

Accelerators: Accelerators provide required funds for the startup owners. They also provide training, advice and resources for the startups and help them attain success in their business. They also guide the startup owners in smooth conduct of their business. They turn the ideas to assets by providing funds, mentorship and     other related help to the startup ventures.

Finance from near ones and dear ones: Startup ventures can raise finance from their near ones and dear ones who are ready to finance for their venture. They provide startup owners funds at a low interest rate and help them start with their project.

All these are most sought after fund raising options by the startups for raising funds for their business and also for the smooth conduct of their business operations.

Business valuation approaches and methods

If you are interested in selling your company or even planning to buy another company you need to know the exact business value of that particular company. Here comes the need of a thorough business valuation. A business valuation is the process of determining the economic value of a whole business or company unit. It can be used to determine the fair value of the business to help in determining the sale value, establishing partner ownership, tax matters and many more.

The business owners hire professional business valuation services in India for an objective estimate of the business value. A through and in depth valuation of the business provides the business owner the multiple facts and figures pertaining the actual worth or value of the company after considering the competition, value of the assets and income values.

If you are still skeptical about what benefits a professional business valuation services offers to the Company, here are some of the points to be taken into account:

1. Better knowledge of the company’s assets: It is very important to obtain an accurate business valuation assessment. Here estimates are not accepted and specific figures will help in making proper business decisions. The professional valuators work on specific numbers so that the owners of the business can obtain proper insurance coverage and know about the amount needed to reinvest in the company and also know the sale value price of the company so that they can reap profits.
2. Understanding of the resale value of the company: If you are planning to sell your company, it is important that you know the true value. The leading business valuation services in India work on various aspects and arrive at the exact resale value of your company and help the seller to negotiate the selling price.
3. Obtain a true value of the company: Based on the simple data including value of the stock market, total assets value and company bank account balances, the owner will have a fair idea of what their business is worth. However, by hiring a reputed business valuation company you can make sure that you have the correct numbers to help you make informed decisions. It is very important to know the true value of the company as it showcases the income of the company and valuation growth over the course of past years. Potential buyers prefer to invest in company that has witnessed regular and continuous growth as it ages.
4. Best for mergers and acquisitions: Business valuations help in showcasing the details including asset withholdings, how the company has grown and its continuous growth parameter if major company is interested about purchasing your company. Most of the big companies work to acquire your business or merge with it by paying less money as possible. A good business valuation report will help you have exact value of your business and help you in making good negotiations.

Access to more investors: If are looking for investors to fund growth or save you from financial loss, the investor will be interested in seeing the full company valuation report and valuation project. They will like to see where their money is going and how it will provide them good return on investment.

Here is the Checklist for due diligence audit

‘It is better to be careful than to be sorry’, this acronym if followed in every aspect of life helps an individual from probable losses or damage. Same is required in business transactions and is called due diligence audit.

Due diligence is the all round appraisal of a business undertaken by the prospective buyer, especially to establish its assets and liabilities and to evaluate its commercial potential. It is in fact, an investigation, audit or review performed to confirm facts or details of a specific matter under consideration.  

Conducting due diligence is an arduous task and is not a cup of tea of a common man. It requires comprehensive assessment of various aspects of the company including financial matters, enquiry about assets, legal issues, and many more so that a more informed decision is reached. 

It is therefore advisable to hire the professional due diligence services in India to conduct the entire procedure so that you get true and fair picture of the scenario at large.
The process of due diligence is performed before any sale of the business, private equity investment. It is the process of analysis and research carried out by the professional experts before an investment, acquisition, business partnership, Bank loan, joint venture, for determining the value of the subject of the due diligence and to see whether there are any major issues involved.
 

Here is the checklist of due diligence audit carried out by a leading due diligence services in India:

1. Documents that are required and to be kept ready: Usually important documents pertaining private limited or limited company are required for performing due diligence:

• Articles and Memorandum of Association
• Certificate of incorporation
• Financial statements
• Income tax returns
• Tax payment receipts
• Property documents
• Utility bills
• Operational and employee records
• Statements of bank 
• Operational records and statutory registers

2. Review of Ministry of Corporate affair documents: Most of the investigation starts with reviewing master data about the company in the MCA website. Information gathered here includes company information, information of the director, charges registered, and important documents. The review of MCA documents provides clear picture of the company to the due diligence officers and person who is performing due diligence.

3. Review of Articles of Association: It is very important to review articles of association during the process. This helps to ascertain varied classes of equity shares and their voting rights. Also, the procedure of transfer of shares can be ascertained.

4. Review of statutory Registrar of Company: Under the Company’s Act 2013, a private limited company is required to maintain various statutory registers pertaining to share allotment, share transfer, board of directors, board meetings etc.

5. Review of financial statements and books of accounts: Assessing accounts books and financial statement detailed financial transaction information is audited by the due diligence officers. The officers; audit- bank statements, cash flow information, valuation of assets and liabilities and financial statements in detail.

6. Review of tax matters: The officers thoroughly check the tax matters of the company to make sure that there are no unforeseen tax liabilities on future date. Various tax related documents like IT returns filed, IT paid, TDS payments, GST payments etc are checked.
 
7. Review of legal aspects: Legal audit is conducted by lawyer to ascertain if there are any pending legal actions, suits or against the company and liability in each.

8. Review of operational aspects: Here the due diligence team audits the business operations, business model and information of the employees by verifying the customers, employees, machinery used, utilities, and production and vendor information.
 

Best CA firms in Delhi NCR for articleship

If you are planning to pursue the lucrative course of chartered accountant then you ought to join articleship with a good CA firm. Articleship is a 3 year practical training phase that enables the CA student to gain real and practical experience by working on real assignments for real employers.

It is important that students should enroll in the best CA firm in Delhi, so that they get good practical work experience and understand all the ins and outs of accounting, its principles and applications.

Articleship training period is the golden period in the life of a CA student. During this period the student has to face umpteen numbers of challenges, get infinite opportunities and turn into a true professional. It is the practical exposure to the things one has learned in their course. It is therefore important to have the right mentor who can guide one in the right direction and help you in transpiring into a true professional without disturbing your CA final studies.

Here are the certain points that you should consider while choosing the best CA firm in Delhi for articleship training:

1. Working hours: One of the most important points that should be taken into account while joining a firm for articleship is its working hours. It is important that you choose the firm whose working hours are feasible to you so that you can strike a perfect balance with your CA study and articleship. Yes it is good to have great exposure but end of the day your goal is to be a chartered accountant for which you need time to study. Accordingly choose a CA firm with normal working hours and where you do not waste time in travelling unless there is no such good firm near you. At times during peak season you will be required to work for extra hours but this should not be followed for the entire year.
2. Exposure during article ship: After you have been short listed in the CA firm for articleship, you must discuss the exposure aspect in detail with the HR or the concerned person so that you are aware of what kind of work would be allotted to you during these tenure. There are lot if firms who keep articles and delegate work that certainly do not add any value for them so make sure about the work you get.
3. Leave policy: The policy of leave should be discussed in detail and should be written in writing as most students must be doing graduation along with CA course and thus require leaves in between to prepare for their exams. Also, one has to prepare for CA finals and need at least 3 to 4 months leave. Few professional CA firms in Delhi NCR are good when it comes to allowing leaves but there are few others who are strict when it comes to the leave part. So prior discussion is required so that you get leaves for exam preparations and practice.
4. Never focus on stipend: There is the trend these days when it comes to choosing a CA firm for articleship on the basis of stipend offered. It is advisable to not to be in a hurry to make money. It is suggested to choose the firm that gives you a good exposure and practical training even if it pays minimum stipend as per ICAI norms.
5. Talk to seniors: A person who is already working in the firm will be best to guide you about the work culture and the kind of exposure the firm provides. Enquire about the number of clients the firm is dealing with, services offered, leave policy, nature of tasks allotted for articles etc.