As start-ups and entrepreneurship are sky-rocketing, more number of people are attracted towards the idea of starting their own Business. Of course, it’s a great idea, but before you start your Business, let me make myself very clear, it’s not as easy as it seems in movies and web-series!
As a Business owner, you will have to follow a lot of compliances and rules to ensure a smooth business operation. As a registered Business, you will have to follow a lot of directives from various authorities and failure to do so might get your penalized. So before you take the big decision to dive-in, it becomes important to understand what you are diving-in!
In this blog, I am going to explain to you about some of the crucial Business compliances that you will have to follow as a Business owner.
Let’s get started
Business Tax returns
Every Business strives to make more profit every year, and that’s the only reason to start a Business in the first place! This profit from your Business is the income of your Business. When you earn something, you will have to pay tax.
Similarly, when you earn money from the Business, you will have to pay tax. Every year, a Business will have to declare its income and pay tax by filing Business returns. Make sure you do not miss the deadline as failure to pay the tax will attract penalty from the income tax department.
Books of Account
Managing books of Account is a vital task that every Business has to perform. Keeping well-managed books helps you track your financial performance throughout the year. Moreover, it is also mandatory for the company to keep records of their transactions. These books of accounts have to be audited by a certified Auditor in case of a Private Limited Company. Even if you are operating an LLP, these books might be needed for an audit if you cross certain thresholds.
It’s challenging to manage all the accounting and bookkeeping in-house as it requires a lot of time and funding. So we would recommend outsourcing accounting and bookkeeping to some expert who can handle these tasks like a pro!
GST registration and Compliances
Almost every Business needs a GST registration if its turnover is above the specified threshold limit. (there are some exceptions though. Some Businesses do not fall under the GST regime, and they do not have to pay GST). So before you start your Business, make sure you get the GST registration done by an expert.
Moreover, you will have to file monthly, or quarterly GST returns like GSTR-3b and GSTR-1, depending on your Business activities and Business’ nature. We would recommend you to register yourself under GST if you are starting a new Business.
Every registered Business has to deduct TDS (Tax Deducted At Source) on any payment. This payment can be the salaries of the employees or payment to any other party. Businesses have to deposit this deducted amount with the Government by filing the TDS returns at regular intervals.
The TDS deducted from the payment can vary depending on the nature of payment and the payee.
If you are registering your Business as a Company, you will have to file ROC returns. Every company is registered under the Companies Act 1952 or Companies Act 2013 has to file their returns to the Registrar of the Company.
These returns consist of various details of the Company like its revenue, profit and loss, balance sheet and similar details. Failure to file ROC returns attracts a hefty penalty and hence we recommend you to hire a compliance agency that can handle all these legal stuff while you focus on your core business.
It is mandatory to hold 4 Board meetings for a Business registered as a Private Limited Company. Moreover, the gap between two meetings should not exceed 120 days. These meetings are made mandatory to address various issues faced by the company to chart the course of the future by preparing suitable plans.
If you have a misconception that running a Business is all merry and fun, but it’s not. Obviously running your own business have many perks, but you will have to take care of certain compliances and rules to avoid any future issues.
Staying compliant with the Government’s rules boosts your credibility and establishes you as a dependable brand. So if you are planning to start a new business or already have started one, get in touch with a legal expert who can assist you throughout your Business journey.
We at Probal Consulting Group also provide all the Business Management, Taxation, Compliance, Accounting and Bookkeeping services for MSMEs and Start-ups. If you need any assistance, we are just a call away!
Probal Consulting Group is a leading Taxation, Accounting, and Compliance firm that helps individuals, MSMEs, and other businesses manage their accounting, taxation regulatory compliance affordably.