POEM Guidance For Companies Engaged in Active Business Outside India

by Sanjeev Archak Sanjeev Archak No Comments

In our previous post, we discussed the idea of Place of Effective Management and how it came into existence. Today we will be focusing on the POEM guidance for companies that are engaged in active business outside India.

Determination of “active business outside India”

A company shall be considered as engaged in “active business outside India” if the passive income is not more than 50% of its total income; and if the following conditions are met –

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Place of Effective Management Rules

by Sanjeev Archak Sanjeev Archak No Comments

The idea of Place of Effective Management or POEM was first introduced in the Finance Act 2015 for the purpose of determining the residential status of foreign businesses. As per the act, any business having its place of effective management in India will be considered as an Indian resident and accordingly, it’s global income will be taxable in India.17

But the Finance Act was missing the entire criteria and process for determining the place of effective management. For this purpose, the Central Board of Direct Taxes (CBDT) introduced the Guiding Principles for determination of Place of Effective Management (POEM) of a Company.

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Significance Of Having a Financial Plan For Your Business

by Sanjeev Archak Sanjeev Archak No Comments

You have always dreamt of starting a business of your own and finally, you got the right business idea which you are very enthusiastic and pumped up about. What’s the next step after this? What do all successful entrepreneurs have in common that makes them turn their small startup businesses into multi-million dollar companies? Well, one common advice that all these entrepreneurs would suggest is to have a sound financial plan for your business.

Planning is bringing the future into the present so that you can do something about it now.

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Concept of Casual Taxable Person under GST

by Sanjeev Archak Sanjeev Archak No Comments

In previous posts, we have discussed who is liable to get registered under GST. In this post, we shall examine the concept of ‘Casual Taxable Person under GST’.

Who is a Casual Taxable Person under GST?

Casual taxable person means a person who occasionally undertakes transactions involving the supply of goods or services or both in the course or furtherance of business, whether as principal, agent or in any other capacity, in a State or a Union territory where he has no fixed place of business.

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Mandatory ROC Compliances For Private Limited Company

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Any private limited company registered in India and successfully operating their business needs to follow the various compliances laid down by the Companies Act, 2013. Failure to adhere to these ROC compliances and regulations would lead to lawsuits and penalties that could severely damage your business and harm the brand that you have worked so hard for.

Following the various ROC Compliances not only makes you a legal entity as per the government norms but also makes you trustworthy for your investors, shareholders, and customers. Read more

What is Better for a Startup – LLP or Pvt Ltd

by Sanjeev Archak Sanjeev Archak 1 Comment

The first legal step towards starting a new startup venture is choosing the right entity for registering their business. Be it a Private Limited Company or a Limited Liability Partnership (LLP). Founders often find themselves stuck at making this kind of decisions as the right choice would determine the nature of the ownership and the management process. It would further set the tone of the various compliances that needs to be followed, be it LLP or Pvt Ltd.

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6 Things About the GST Bill and How It Affects Your Startup

by Sanjeev Archak Sanjeev Archak No Comments

India’s biggest tax reform known as The Goods and Services Tax(GST bill) has been making headlines since the day it was first introduced. It is touted to be the biggest revolution in the history of the Indian Tax System since Independence.

On April 13th, 2017 the President of India, Shri Pranab Mukherjee signed four enabling bills related to the GST. Thus making it into law and bringing the country a few steps closer to its dream of ‘One nation, one tax’ reform.

The four legislative bills passed were the Central GST Act, 2017, the Union Territory GST Act, 2017, the Integrated GST Act, 2017 and the GST (Compensation to States) Act, 2017. Everyone is now looking forward towards the State governments to pass the State GST bill at their respective assemblies. Read more