FAQs

Frequently Asked Questions

Is IEC (Import Exporter Code) necessary for freelancers who export services outside of India?

It is not necessary for export of services for freelancers (as these would be general services). Please have a look at the highlighted text of Sec 7 below:

How do I begin a sole proprietary firm in India?

There are 3 ways you can register a sole proprietorship in India. 1. GST registration: You need GST registration if your annual turnover is expected to cross 20 lakhs/40 lakhs. Also, if you intend to supply in other states, you should take GST registration irrespective of turnover. 2. Registration under Shop & Establishment Act: This can be done if you have a shop or a place of business 3. Registration through Udyog Aadhaar under Ministry of MSME: Under this, a unique identification number is provided by the ministry of MSME to the business owner.

In India, can one person have multiple sole proprietorship businesses registered under his name?

Yes one person can register multiple proprietorship businesses. There are 3 common ways to get a proprietorship registered, one could choose depending upon the requirements and applicability: GST registration MSME registration Registration under shop & establishment Important thing to understand here is, proprietorship is based on PAN, so if you have registration on your PAN, though it looks like these are seperate businesses but as far as taxation laws are concerned (more specifically Income tax laws), all the businesses would be assessed in combination. Though, you can have separate GST registration on a PAN for various business verticals. Whether, it would be beneficial to do so or should one do all the business under a single GSTIN should be worked out.

Are company registration and GST registration the same?

These are not same. While company registration is about choosing the form of entity, among various other forms like partnership, LLP, proprietorship, AOP etc. When you choose company as the form of entity, you need to register the company under the Companies Act. So, it's a choice not a legal compliance to register the company GST registration is registration under the GST Act, which any form of business could be required to register if it's applicable on them. Even if you register a company, you might have to register the company under GST if it doesn't have the turnover exemption.

How will transactions of more than one buyer/seller be filed in Form 26QB – TDS on immovable property?

Form 26QB needs to be filed for each seller separately. Similarly, in case of multiple buyers, each needs to issue Form 26QB separately. Form 26QB is to be filled in by each buyer for unique buyer-seller combination for respective share. E.g. in case of one buyer and two sellers, two forms have to be filled in and for two buyers and two seller, four forms have to be filled in for respective property shares.

How can I claim a refund of TDS deducted u/s 206AA due to the non-furnishing of PAN?

Since you have not furnished the PAN, the tax so deducted would not be credit to your TDS in 26 AS and therefore you cannot claim the refund of TDS. What you should do? In order to be able to claim the refund of TDS, you need to contact the deductor to credit the TDS to your PAN (he would have to revise the TDS return). Once the revision is done, it would be available as a credit to your PAN and you could claim the refund by filing the ITR.

What do I do if a mismatch appears in the actual TDS and TDS credit as per Form 26AS?

If there's is mismatch in actual TDS and TDS credit, you won't be able to claim the credit. So here's what you could do. Determine that the mismatch accounts to which of the deductors. Mismatch could be because of an error in deductors TDS return. So, you need to communicate the mismatch to the deductor, so that he could revise the TDS return. One should keep a record/proof of actual TDS deducted. Once the TDS return is corrected, you would be able to see the correct credit on 26AS, you need to download the credit statement a few days after the correction is filed.

Do I have to file taxes in India if I am an NRI?

As an NRI, any income which is earned or accrued in India is taxable in India. While income which is earned outside India, is not taxable in India. So, if you have taxable income in India, which exceeds the basic exemption limit of Rs 2.5 lakhs, you would be required to file ITR. Note: one must determine their residential status as per income tax act to determine the taxability of their income.

Who needs to file their tax returns in India?

As an Individual, one is required to file an ITR if their total annual income before taking into account any tax deductions exceeds the basic exemption limit i.e. Rs 2.5 lakhs. Also, if somebody has losses and they like to claim the losses to carry forward, they have to file the ITR to claim losses. Further, if you have TDS deduction and you seek for a refund, that could be done by filing ITR only. That's the basic criteria to file ITR.

What is the last date for filing an income tax return in India?

The due date for filing ITR for Individual, HUF, AOP, BOI for FY 18–19 is 31st July 2019. While, for businesses requiring tax audit, it is 30th September. Further, it would be relevant to mention that if the due date for filing the ITR is missed, one can file a belated return for the FY 2018-19 on or before 31 March 2020. However, this would require payment of late fee and interest, if there was tax liability. There are some other disadvantages as well of filing a belated ITR. So, it's advised to file in time.

My employer deducted TDS but did not deposit it to my account. what can I possibly do to get my taxes paid?

Here’s possibly what you can do: 1. Communicate with the deductor: The easiest resolution would be to communicate with the deductor about the issue, there could be a chance of mistake or omission in the TDS return which could be rectified by him and you would be able to claim the TDS credit. 2. Filing complaint to deductor’s assessing officer regarding default in TDS return: If the above resolution doesn’t work, one can communicate the matter to the deductor’s tax assessing officer 3. Filing complaint to your assessing officer: One can also file the above complaint to his/her own tax assessing officer. Alternatively, once you file the ITR, you would receive a notice regarding the mismatch of TDS in the ITR, on receipt of notice you can raise a rectification request and submit the relevant documents in your possession proving that taxes were deducted.

Why shouldn't I claim input credit for the purchase of two trucks whose rent doesn't attract the GST, as it’s for my own purpose?

GST input credit in case of motor vehicles is available only if : a) You are a dealer of motor vehicles b) You are engaged in a business of transportation of passengers or goods c) You are engaged in imparting training on driving such vehicles. So, if you are engaged in any of the above 3 businesses you can claim the input tax credit, otherwise not.

What should I do when my application for GST registration got rejected?

You should look at the reasons for rejection and then reapply with appropriate correction which would reduce the risk of rejection again. You could consider taking professional assistance for a seamless, quick & successful registration

How can I cancel my GST registration as a tax collector (e-commerce)?

In order to cancel GST registration , one has to apply for apply for cancellation of GST registration by logging into the GST portal. One need to make sure all the dues are and all returns filed before doing so. GSTIN stands cancelled once the application is approved by the authorities

Does a businessman with a turnover under 20 lakhs, and doing interstate business, need a registration under GST?

Yes GST registration is required. Any business engaged in Interstate supply is required to register & comply with GST mandatorily. The turnover threshold exemption isn’t available to a business engaged in interstate supply. If your business runs on a calendar year, Form 1120S is due on March 15. If you file a business tax extension, your due date is September 16. S-corp tax forms have more complicated deadlines than personal tax returns since there’s no hard-and-fast date. Technically, Form 1120S is due by the 15th day of the third month after the end of your tax year.

Do I need GST to sell products onlin

Yes. In order to be an online seller, GST registration is compulsory. If one wants to be a seller on a e-commerce platform like Amazon, they need to register as a taxpayer. While, if one has a portal of their own and they intend to invite sellers to sell on their portal. They will be required to register as a tax collector as well.

Do we need to file both GSTR 1 and GSTR-3B for NIL transactions?

Yes it is mandatory. Even for nil transactions, one has to file the GST returns. GSTR 3B has to be filed monthly and GSTR 1 can be opted to file quarterly, if the turnover is upto 1.5 crore.

Can I get register for GST at my home address?

Yes that can be done. If you are conducting your business from home, you can register under GST using your home address. All you would need is a proper set of documents to suffice the requirement of address proofs and other documents to get through the registration process. If the address is a rented address, a rent agreement along with an electricity bill will work as address proof While, if the address is an owned address, you would have to furnish an ownership proof. For instance, the property documents, property tax receipt etc.

Can I sell online and offline under the same GST number?

Yes that can be done. One do not need separate GST number to sell online and offline. Same GSTIN can be used for both.

Which documents are needed to register for a GST number as an individual?

Following documents and information would be required for GST registration 1. Aadhaar of the applicant 2. PAN of the applicant 3. Photo passport size of the applicant 4. Signed Cancelled cheque having name of applicant 5. Rent agreement for the proof of place of business 6. Proof of ownership of principal place of business 7. Name of firm 8. Mobile number of the applicant 9. Email address of the applicant 10. Description of nature of goods & services intending to supply.
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