Registrations
The standard registration requirements are provided below:
- Permanent Account Number: Linked to the taxable person/ entity and the number is allotted by the Income Tax Department. It would be mandatory for conducting business and required to establish identity.
- Tax Deduction Account Number: Every person making payments that are liable to withholding of income tax would need to obtain tax deduction account number. The number would be obtained based on the jurisdiction from where the payments are made.
- Shops and Establishment: It is a state specific requirement and differs from State to State. Every place or establishment of business is required to be registered, requiring declaration of the number of employees working in the said establishment.
- VAT (Sales Tax)/ CST: This is levied by the State Government and would be required in case the business is engaged in purchase or sale of goods. The registration number is unique for each State and is required to be obtained in the State where the sale originates i.e. the place from where the movement of goods originates. The principle place of business within the State would be registered and every other place needs to be declared as additional place of business and included in the registration. The definition of sale is wide to cover transactions in the nature of lease, hire purchase, works contract, supply of food in a restaurant, etc. On implementation of GST, VAT/ CST would be subsumed.
- Service Tax: This is levied by the Central Government on provision of taxable services. In case the business is engaged in providing taxable services, registration under service tax would be warranted and each place of business needs to be registered. As the tax is levied by the Central Government, in case of multiple place of businesses spread across many States, an option for centralized registration is available provided the business has centralized accounting or invoicing system. On implementation of GST, levy of service tax would be subsumed.
- Import Export Code (IEC): In case the business involves any import or export of goods or services, obtaining IEC would be mandatory. This is required to be obtained from director general of foreign trade.
- Intellectual Property Rights: In case the business is conducted under a brand name, logo or mark, it is advisable to protect them under the trade mark and copyright laws.
- Provident Fund: In case the number of employees exceed 20 or more, registration with the regional office of the Provident Funds Organization would be required. The current contribution rate is 12% each from employee as well as employer, which may be capped to specified salary limit.
- Employee State Insurance Corporation (ESIC): Every business employing more than 10 employees is required to get themselves registered with the concerned regional office of the ESIC. The contribution is different for the employer and employee.