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Direct Tax Consultancy

Direct tax consultancy together with innovative tax efficient strategies, provided by us form an integral part of viable business decisions. These help our clients attain the desired goals. We adopt a “result oriented approach” which is flexible and emphasizes delivery and value. It enhances the effect of commercially viable decisions and minimizes the tax burden.

 

Assessment and appeals
Assessment (audit by tax authorities) and appeals The assessment and appeals procedure under the Act involves the following:

 

Self-assessment
Every assessee, before submitting a tax return, is required to make a self-assessment of income and after taking into account the amount of tax already paid by way of TDS and advance tax, pays the balance tax (self-assessment tax) due on the income. Further, along with the tax, any interest arising on account of delay in furnishing of tax return or any default /deferment in payment of advance tax, is also required to be paid.

 

Withholding Tax
Withholding taxes on payments other than salaries Under the Act, a person making certain specified payments such as salary, contractual payments, rent, interest, professional or technical fees, commission, payments to non-residents, etc. is required to withhold tax at source from such payments and comply with the associated requirements in respect of deposit of taxes in the Government treasury in the prescribed manner, issue of tax credit cerficates and filing withholding tax returns. The rationale of withholding tax is to provide a mechanism for tax authorities to collect tax at the source of income, and also to expand the tax base.
Failure to comply with the prescribed withholding requirements could result in the levy of penal interest, penalty and prosecution under the Act, in addition to the liability to make up for the taxes not withheld/deposited.

 

The following chart depicts the withholding tax provisions prescribed under the act:
Some of the direct tax services provided by us include :

 

Income Tax & Withholding Taxes

  • Advising on Income Tax Planning of Corporates.

  • Advising & reviewing of all necessary tax withholding responsibilities.

  • Advising all financial subjects which are of your interest and keeping you updated on the new amendments, circulars, notifications & judgments.

  • Verification of all payments to vendors for the purposes of determination of correct application of rates and category for deduction of withholding taxes.

  • Computation of monthly TDS on the basis of above.

Computation of the advance Income Tax & Wealth Tax liability

 

  • Monthly tax reconciliation of the TDS due and deducted.

  • Preparation and deposit of Monthly challans on or before the statutory due dates.

  • Filing of quarterly E-TDS Returns.

  • Filing of quarterly E-TDS Returns.

  • Filing annual Income Tax returns for Corporate & Non-Corporate Clients.

 

Certification Work
Issuance of Chartered Accountant certificates u/s 195 required for the Overseas Remittances purposes from time to time.

Transfer Pricing

In order to curb the practice of avoiding tax by the foreign companies in India, a legislation under the name ‘Transfer Pricing Regulation’ has been introduced.
 

The following are the important statutes of the law.
 

  • Each person or association who has involved in an international transaction should maintain an up-to-date record of each transaction as prescribed by the legislation price, depending on the nature and type of the transaction, the nature of the group or the association involved, or any other features of the transactions involved. These methods are introduced by the Central Board of Direct Taxes, generally known as the ‘Board’. Some of them include the resale price method, cost plus method, comparable uncontrolled price method, and transactional net margin method. All income acquired by the company by means of any international transaction shall be calculated at arm’s length price. There are various methods to calculate the arm’s length

  • If there are two or more appropriate prices assumed for a certain transaction, the arm’s length price will be calculated as the average of the prices.

  • At the end of a financial year, the person or group involved in an international transaction should submit the report of it in Form 3CEB under the guidance of a Chartered Accountant.

  • This form has to be filed before he files the Income Tax return of the same period.

  • The group or person who does not adhere to these rules is liable to pay the penalties as imposed by the Board.

 

How can Khivasara and Co. help you?
 

We act as the advisor to your company, especially in matters concerning the effective operation of your business in India. We can help you in countering the new Transfer Pricing Regulation in a cost-effective manner, without consuming much of your time. We provide you the appropriate solution after studying your business objectives and the nature of transactions that have been carried out.
 

The following step-by-step procedures explain our modus operandi.

  • A fact-finding exercise is carried out in order to analyze the various functions performed by the organization and the possible risks that can be encountered by each activity.

  • Select the appropriate method of transfer pricing and identify the parties who have been tested with the particular method.

  • Conduct a survey based on the database available from various national and international sources in order to identify the companies that can be benchmarked for the selected company and perform a financial analysis on the basis of them.

  • Prepare a consolidated report on the basis of the analysis and document it appropriately. 

  • Issue the report in Form 3CEB as mandated by the Indian Income Tax Act, 1961.

Khivasara and Co is also specialized in defending the transfer pricing policy of various companies in front of the policy officers and thus counter them in an efficient manner.
 

Should you know how to carry out the business activities adhering to the transfer pricing policy or should you have any query on other related procedures, you may contact us
 

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