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An Overview and Need for Lower Tax/TDS Deduction Certificate (LTC):
A Lower Tax/TDS Deduction Certificate (LTC) is issued by the Indian Income Tax Department to Non-Resident Indians (NRIs) who are selling property in India. This certificate allows for a reduced rate of tax deduction at the time of property sale.
Typically, when an NRI sells property in India, the buyer is required to deduct TDS (Tax Deducted at Source) at the applicable rate, which can range between 20.8% to 23.92% depending on the sale price of the property, before making the payment to the NRI seller. However, NRIs can apply for an LTC to lower the TDS rate.
⇒ Non-Resident Status
The seller should be an NRI under the Indian Income Tax Act.
⇒ Tax Compliance
The NRI should have complied with all Indian tax laws.
Application Submission
The NRI needs to apply for the LTC by submitting Form 13 to the Assessing Officer of the Income Tax Department. This form requests a lower TDS deduction certificate.
Justification for Lower TDS Rate
The application should include reasons justifying the need for a lower TDS rate. This could include computation of capital gains, tax liabilities, etc.
Assessment by Tax Authority
The Income Tax Officer reviews the application and supporting documents to determine the appropriate TDS rate.
Issuance of Certificate
If the assessing officer is satisfied with the application, they issue the Lower TDS Deduction Certificate specifying the reduced rate at which TDS should be deducted by the buyer.
Providing Certificate to Buyer
The NRI should provide a copy of the LTC to the buyer before the property transaction. This enables the buyer to deduct TDS at the reduced rate mentioned in the certificate.
TDS Deduction and Deposit
The buyer is responsible for deducting the TDS amount from the sale proceeds payable to the seller at the rate mentioned in the Lower Tax Certificate. This deducted amount needs to be deposited by the buyer.
TDS Return Filing
Subsequent to depositing the TDS amount, the buyer should file TDS return form 27Q with the Income Tax department. This filing is crucial for linking the deposited TDS amount with the PAN of the Seller. This linkage enables the seller to adjust or claim a refund of the deducted amount while filing their Income Tax Return.
Form 16A
The seller should request Form 16A from the buyer. This form serves as verification that the buyer has correctly filed the TDS return, displaying the buyer’s PAN card information. The buyer is obligated to issue Form 16A to the seller within the stipulated timelines.
1. Sale agreement
2. Details of the property
3. Purchase Deed/ Allotment Letter/ Gift Deed
4. Proof of NRI status
5. PAN card of Seller and Buyer
6. TAN card of Buyer
7. Address proof of Buyer and Seller
8. Power of Attorney (If applicable)
9. Tax payment receipts (if any)
1. Area of Property
2. Mobile Number of Buyer and Seller
3. Email Id of Buyer and Seller
Among all, the first step involved for the process of company incorporation is ascertaining the availability of name. A company is identified through its name it registered on the Ministry of Corporate Affairs. Hence choosing an appropriate name is the important and crucial thing.
For the same, an application will be submitted for the reservation of name to the Ministry of Corporate Affairsby login to the sitehttps://www.mca.gov.in/mcafoportal/login.do and preference wise 2 names along with the business objective can be provided. Once the name gets approved, it’s reserved for 20 days within which applicant needs to complete all the remaining process for the incorporation of the Company.
Stakeholders shall ensure that the proposed name selected does not contain any word as prohibited in Section 4(2) & (3) of the Companies Act, 2013 read with Rule 8 of the Companies (Incorporation) Rules, 2014.Points to be considered while suggesting the name:
-Check Trademark for your proposed name on the site https://ipindiaonline.gov.in/tmrpublicsearch/frmmain.aspx
– Check domain for your proposed name on the site https://www.registry.in/index
-Check the availability of Company Name on the site https://www.mca.gov.in/mcafoportal/viewCompanyMasterData.do
Therefore, choosing an appropriate name which does not prohibit any law will be the most important thing.
There is also another way to finalize the name of company and its incorporation in one go i.e., apply name and company incorporation together. However, if the same has been rejected by the MCA, then all the documentation will be done again
Once the name gets approved in PART A, the basic details will be automatically filled in all linked forms of PART B. There will be total 4 linked forms which will be generated such as AGILE-PRO, Spice+ MOA, Spice + AOA and INC-9. These linked forms will be filled up with the necessary details like capital subscription, name of shareholders and directors, percentage of holding among the shareholders, Interest of shareholders in other entities, etc.
For completion of the Part B, many other details and documents will be required which is discussed as below:
For the E-filing of all the forms, Digital Signature is a mandatory requirement. Digital Signature is in form of digital key containing all the information about the registered signatory like name, address, Contact No, Email ID and the authority detail which has provided the certificate. All the forms will signed digitally by the authorized signatory by proving its identity through the Digital Signature Certificates.
Director Identification Number is a unique identification number of 8 digits for the directors of a Registered Company.Every director will be provided a unique number with which he will be identified by the MCA. To become a director, one shall apply for getting the DIN from the MCA.To applying DIN, the applicant has to make an application in e-Form DIR-3 and shall follow the below mentioned process
This form is for GSTIN, Employees Provident Fund Organization registration, Profession Tax Registration, Opening of Bank Accounts, Shops and Establishment registration.
It is mandatory to register for ESIC, EPFO, Professional Tax (for Maharashtra) and bank account opening to obtain AGILE-PRO via e-form, However, GSTIN Registration is optional for the applicants.
MOA is a document which contains all the fundamental information about the company, the objectives of the company in brief, the share capital, type of Shares whether equity or preference and its shareholders details, details of allocation of shares among the shareholders along with their name, address and occupation, etc. Company can perform and undertake only those activities that are mentioned in the objectives of Memorandum of Association beyond which the company cannot undertake any other objective but the Memorandum of Association (MOA) can be amended with the approval of the shareholders.
As per Section 4 of the Companies Act, 2013, Companies shall form MOA as specified in Tables A to E of Schedule -I of the Act. Below is the list of tables with their meaning:
Table A: Company Limited by shares
Table B: Company limited by guarantee and not having a share capital
Table C: Company limited by guarantee and having a share capital
Table D: Unlimited Company and not having share capital
Table E: Unlimited Company and having share capital
Hence Company shall adopt an appropriate table applicable to it as there are various forms of tables for different companies.
AOA defines the rules and regulations that govern the internal management of the company for achieving its objectives.
Various forms in Tables F to J for different companies have been mentioned under Schedule I of the Companies Act 2013 and AOA must be in the respective form.
Table A: Company Limited by shares
Table B: Company limited by guarantee and having a share capital
Table C: Company limited by guarantee and not having a share capital
Table D: Unlimited Company and having share capital
Table E: Unlimited Company and not having share capital
Declaration shall be given by the subscribers and directors in the form INC-9 that:
Once all the above documents and details are ready, then the application for the incorporation of the company can be made via e-form Spice accompanied by Spice MOA and Spice AOA with the registrar under whose jurisdiction the address of the company is located. All these e-forms need to be affixed by the Digital Signatures of the respective persons.
The Registrar of Companies will grant a Certification of Incorporation along with the Copy of PAN, TAN, EPF, ESIC which will be used as for the identity of the company existence.
Once the company gets incorporated then there are many compliances which need to be performed by the company
The Company within thirty days of its incorporation shall furnish to the Registrar of Company regarding verification of its registered office by filing the e-form INC-22.
INC-22 shall be downloaded from the Ministry of Corporate Affairs site and any of the following document will be attached with this form:
Every Company incorporated shall within 180 days of its incorporation shall file the declaration for the Commencement of the Business with the Registrar of Company. It is the declaration regarding that all the subscribers to the MOA have deposited the total value of the shares agreed to be taken by them in the Company Bank Account. Proof for the same shall be attached while filing the form INC-20A. Bank Statement shall be used as the evidence for the same.
COMPLIANCESPRO has a separate team which is expert in completing this complex process very easily and helps you to get the company registered within 3 daysonly in a very reasonable price.
⇒ Support for completing the necessary documentation required for the application process.
⇒ Thorough preparation and submission of the application to the Central Government on your behalf.
⇒ Persistent follow-ups with the Income Tax Department to expedite processing.
⇒ Addressing queries from the Income Tax Department and furnishing any additional documentation as requested.
⇒ Provision of Form 13 for the Lower Tax/TDS Certificate application.
⇒ Facilitation of TDS deposit with the Income Tax Department.
⇒ Prompt filing of TDS return to ensure seamless linking of deducted tax with the Seller’s PAN.
⇒ Timely issuance of Form 16A to the Seller.
After Sale Services:
The true measure of a service provider’s reliability often reveals itself only after payment, as some fail to honour their commitments. However, we stand in stark contrast to this. We offer complimentary consultancy for one year following the assignment’s execution. Whether your entity encounters issues or seeks guidance-related to services acquired from us or otherwise-we remain accessible. Our comprehensive services cover direct taxation, indirect taxation, Labour laws, company compliances, GST, and more, eliminating the need to engage multiple service providers.
Free Yourself from All Compliances:
We help entrepreneurs to grow their business by taking their burden of all kinds of compliances and enabling them to focus and invest their time only on own business and grow it more efficiently and effectively instead of finding different person for different compliances.
Experienced and Upgraded Team:
We are an organized team of experienced Chartered Accountants (CAs), Company Secretaries (CSs), Merchant Bankers, Accountants, Industrial & Labour Laws Consultants, FEMA Consultants, Transfer Pricing (TP) Consultants, among others, duly supported by a pool of trained staff spread all over India, to provide high-quality services. Our team members are always updated with the latest changes and new laws, rules, and regulations. A regular session is taken with the team to update them with all the compliances and new things which can benefit the client in getting more benefits in terms of monetary and non-monetary benefits
Segregation of Duties:
We assign different kind of works to different experts instead of allotting all different kind of works to the single person which provides the accuracy in the work and benefit of expertise.
Partners instead of Employees:
Members of the team are paid on a shared basis for the work assigned to them instead of a fixed salary for efficiency, effectiveness & motivation while execution of work of all the clients.
Data Storage on Cloud along with Server:
There can be any kind of uncertainty in the office area, systems where your data is stored. But that uncertainty should not result in the loss of even a small amount of data of client as it is the most crucial for them. Hence your data is always stored on the cloud to avoid any kind of loss, hacking, misuse, etc. in case of any kind of uncertainty
Total Security Antivirus in Server:
As the use of IT services has increased, so has cybercrime and hacking. To ensure the security of our clients’ data and our own systems, we employ Total Security antivirus on our servers, safeguarding against viruses, ransomware, and various other cyber threats.
Modern approaches instead of Traditional ways:
We have a set of standards and rules which all the team members need to follow while executing any work. This helps us to provide quality services to the clients and avoid any kind of error. Hence, our team executes the work allotted by following a set of standard rules and SOP instead of traditional manual ways.
Upgraded Licensed Software’s:
Work are performed through automated software’s (only Licensed) which auto identify the errors, omissions, or non-compliances instead of paper working or working directly on the sites. Few examples of the software are- Compu Tax for Income Tax, Speqta for GST compliances, Compu TDS & TCS for TDS & TCS compliances, Licensed Microsoft Office 365 for office applications, etc.
Record Maintenance on Behalf of the Client:
Government departments have the right to ask for the records and documents from the assesses. Different time periods are prescribed by different laws up to which these records can be asked for. Apart from this, a client can also require it for its personal needs like analysis, decision taking or other purposes. Hence, records of all the compliances required by law or client to be kept by the client are maintained by us on behalf of the client to assist them to produce the same if asked by department or any statutory body or for its personal use.
Online Service:
Our aim is to save the maximum time and money of the client. Hence, we deliver fast and reliable services, mostly in an online environment by taking all the documents via online channels like WhatsApp, Gmail, etc. requiring no need to unnecessarily visit the offices.
