Consolidated FAQ Hub

DPIIT recognition unlocks crucial income tax exemptions (like Section 56(2)(viib) protection), access to government funding programs, simplified compliance checks, and faster patent registrations.

Founder shares are typically structured with a four-year vesting schedule and a one-year cliff. Under Indian law, this is executed via custom Share Purchase Agreements containing reverse-vesting buyback provisions.

Management Information System (MIS) reports are structured financial statements (P&L, Balance Sheet, Cash Flow, Aging Analysis) prepared monthly to give owners data-driven visibility into corporate margins and expenses.

Yes. Accounting records maintained in electronic form on cloud services are fully valid under Section 128 of the Companies Act, provided they remain accessible in India and maintain audit trails.

Exporters can claim refunds by either executing a Letter of Undertaking (LUT) to export without paying IGST, then claiming refunds on accumulated Input Tax Credits, or by exporting with payment of IGST and claiming refunds on tax paid.

If a vendor fails to file, the tax payment will not reflect in your GSTR-2B. Under Section 16(2)(aa) of the GST Act, you cannot claim ITC for that invoice, which requires proactive ledger monitoring and vendor vendor-compliance checks.

Companies (Auditor's Report) Order (CARO) is a strict reporting framework requiring auditors to list disclosures on assets, inventories, internal audits, and loans. It applies to all public companies and private entities crossing specific turnover or asset thresholds.

Ensure all bank statements, vendor reconciliations, statutory register updates, fixed asset registers, and payroll TDS payments are fully reconciled and logged before auditing begins.

A Registered Valuer report is mandatory under the Companies Act for issuing new shares, buying back shares, business transfers, mergers, or transferring equity assets to related corporate parties.

Discounted Cash Flow (DCF) values a company based on the present value of its projected future cashflows, representing a growth-oriented view. The Net Asset Value (NAV) method values it based on book value of net assets, representing a liquidation-oriented view.

Non-dilutive capital refers to funding that does not require giving away equity. Startups access this via venture debt, revenue-based financing, or working capital bank facilities syndication.

Organize three years of audited accounts, monthly MIS charts, tax compliance certificates, shareholder registers, client contracts, and forward cash projections into a secure, indexed drive.

Under the Liberalised Remittance Scheme (LRS) and FEMA rules, an NRI can repatriate up to USD 1 Million per financial year from their NRO account, subject to producing Form 15CA/15CB tax clearances.

Form 15CB is an official certificate issued by a Chartered Accountant certifying that appropriate taxes have been paid on remittances. It is mandatory for transferring foreign remittances exceeding INR 5 Lakhs.

Yes. A foreign national can be appointed as a director. However, at least one director on the Board must be a resident of India (present in India for 182 days or more during the financial year).

The company must report capital inflows to the Reserve Bank of India via the FIRMS portal within 30 days of issuing shares to the foreign parent company.

A Private Family Trust protects family assets from commercial business liabilities, avoids probate delays upon estate transition, and allows custom control over beneficiary payouts.

Yes. To transfer real estate or capital assets to a trust, the trust deed must be registered with the sub-registrar under the Indian Trusts Act, ensuring clean legal title transfer.

An LLP provides limited liability protection to partners and has distinct legal identity, protecting personal assets from business debt claims.

The entire process including name approvals, registration filings, and asset transfer schedules typically takes 15 to 20 working days.

Independent directors can be held liable for acts of omission or commission by the company that occurred with their knowledge, consent, or lack of due diligence.

It lists all potential tax, environment, labor, and company law compliance dates, assigns owners, and flags delays before penalties trigger.

A cash flow statement is mandatory for all companies except small companies, one-person companies, and dormant companies under Section 2(40) of the Companies Act.

Ind AS is converged with IFRS but contains minor modifications (carve-outs and carve-ins) to align with Indian economic and legal realities.

EPF registration is mandatory for establishments employing 20 or more persons, with contributions required for employees earning up to INR 15,000 basic salary.

Delays attract interest at 12% per annum under Section 7Q, plus damages ranging from 5% to 25% per annum under Section 14B.

Late filing attracts a penalty of INR 100 per day from the due date, and long-term delays can lead to strike-off actions against the company.

Board meeting minutes and general meeting records must be preserved permanently in physical or secure electronic registers.

It offers a flat rate of 22% (plus surcharge and cess, making it 25.17%), provided the company waives specific deductions and tax incentives.

It refers to the pricing of transactions between related parties, which must align with Arm's Length Pricing (ALP) rules under Section 92 of the Income Tax Act.

For companies subject to tax audits, the deadline is October 31st of the assessment year (or November 30th for international transaction profiles).

Section 234B covers interest for default in payment of advance tax (less than 90% paid). Section 234C covers interest for deferment of quarterly installments.

Notices are issued, and defenses are filed entirely online through the e-filing portal. Allocation of cases to tax officers is automated, removing direct physical contact.

An appeal must be filed within 30 days from the date of service of the assessment order or demand notice.

An individual is a resident if present in India for 182 days or more during the year, or 60 days (extended to 120/182 days for Indian citizens/PIOs visiting) plus 365 days in the preceding four years.

NRIs can reinvest sale proceeds in another residential property in India under Section 54, or purchase capital gains bonds under Section 54EC.

The threshold is INR 10 Crores (increased from INR 5 Crores) for businesses, provided cash transactions do not exceed 5% of total receipts/payments.

GST registered taxpayers with aggregate turnover crossing INR 5 Crores in a financial year must file a self-certified reconciliation statement in GSTR-9C.

Yes, for private companies crossing INR 200 Crores turnover, or with outstanding loans/deposits crossing INR 100 Crores at any point during the year.

It checks segregation of duties, validates vendor authorization pools, and verifies physical inventory matching, removing opportunities for asset loss.

Standard audits verify that accounts present a true and fair view based on sample testing. Forensic audits investigate specific suspicions to collect evidence suitable for court review.

It is the illegal transfer of company funds or assets to promoters or related entities, often hidden through fake vendor invoices.

To verify that the target company's financial records are accurate and free from hidden liabilities, confirming the deal valuation.

Audits check compliance with accounting standards. Due diligence assesses commercial risks, revenue sustainability, and operational parameters for a buyer.

A slump sale is the transfer of a business undertaking for a lump sum consideration without values being assigned to individual assets, taxed under Section 50B.

Yes, standard mergers under Section 230-232 require National Company Law Tribunal (NCLT) approval, though fast-track merger options exist for startups and small companies.

A DPR is a document mapping project costs, market analyses, technical specifications, and 10-year cash projections, proving loan repayment capacity.

Debt Service Coverage Ratio (DSCR) measures the cash available to pay debt obligations. Banks typically require a DSCR above 1.25x for project loans.

CPs are regulatory or financial tasks that a company must complete before investors release transaction funds (e.g. updating company board rules).

Form PAS-3 is the return of allotment of shares that must be filed with the ROC within 30 days of allocating shares to investors.

Yes, up to USD 1 Million per financial year, subject to paying applicable taxes in India and filing Form 15CA/15CB clearances.

Authorized Dealer (AD) Category-I banks are financial entities licensed by the RBI to process foreign exchange transactions.

POEM is the place where key management decisions of a company are made. Foreign entities with POEM in India are taxed as domestic entities.

Under RBI LRS rules, resident individuals can remit up to USD 250,000 per financial year for overseas investments or expenses.

A holding company can defer taxes on investment returns by reinvesting profits before dividend payouts are triggered.

Long-term capital gains on unlisted shares are taxed at 20% (plus surcharges) with indexation, requiring a 24-month holding period to qualify.

No, under FEMA rules, NRIs cannot acquire agricultural land, plantation property, or farm houses in India, unless inherited.

The baseline TDS rate is 20% on the capital gains, plus applicable surcharges and cess, though obtaining a Lower Deduction Certificate reduces it substantially.

A Trust is registered under the Indian Trusts Act and is simpler to administer. A Section 8 Company is registered under the Companies Act, has a corporate structure, and enjoys higher credibility with foreign donors.

It is a registration under the Income Tax Act that allows donors to claim tax deductions on contributions made to the registered NGO.