Shareholders Agreement: 15 Key Clauses Every Founder Must Know 📌 Quick Answer: A shareholders’ agreement (SHA) is the foundational document governing the relationship between founders, investors and other shareholders in an Indian startup. The 15 key clauses every founder must understand span four categories: governance rights (board composition, reserved matters, information rights), economic rights (liquidation […]
Category Archives: GST
Startup Exit Strategies: Acquisition, IPO, Secondary Sale & Buyback 📌 Quick Answer: Indian startup exits typically take one of four forms: acquisition (most common, governed by the Companies Act, 2013 and FEMA), IPO (regulated by SEBI ICDR Regulations), secondary sale (existing shareholders sell to new investors) or buyback (the company repurchases its own shares under […]
Transfer Pricing Documentation: Form 3CEB, Master File & Local File — Section 92D, 92E, Rule 10D, 10DA, 10DB Compliance Guide Quick Answer: What Is Transfer Pricing Documentation? Transfer Pricing Documentation refers to the three-tiered documentation framework that Indian taxpayers with international transactions or specified domestic transactions must maintain under Section 92D of the Income-tax Act, […]
15CA-15CB Foreign Remittance Filing Guide: Section 195 & Rule 37BB Compliance 📌 Quick Answer Every payment to a non-resident from India requires a Form 15CA declaration on the Income Tax e-filing portal, and if the remittance exceeds ₹5 lakh and is taxable, a Chartered Accountant must first issue Form 15CB certifying the correct TDS rate […]
India-to-Delaware Flip Structure: FEMA, Tax & ODI Compliance — Complete Guide 📌 Quick Answer Flipping an Indian startup to a Delaware C-Corp involves creating a US parent entity, executing a share swap or transfer so that Indian shareholders hold US equity and the Indian company becomes a wholly-owned subsidiary. This triggers compliance under FEMA Overseas […]
GST Section 74 Fraud Allegation: Defence Strategy 📌 Quick Answer Section 74 of the CGST Act is the most severe demand provision — it applies only where tax non-payment is attributable to fraud, wilful misstatement, or suppression of facts with intent to evade tax. The penalty is 100% of the tax demand, the limitation period […]
Presumptive Taxation: Section 44AD, 44ADA, 44AE — Eligibility, Thresholds & Benefits Quick Answer Presumptive taxation under Sections 44AD, 44ADA, and 44AE of the Income Tax Act, 1961 allows eligible small businesses, professionals, and goods-carriage operators to declare income at prescribed deemed-profit rates without maintaining detailed books of account. Section 44AD applies to businesses with turnover […]
TDS on Property Purchase: Section 194-IA Compliance — Form 26QB, Rate & Threshold Quick Answer Under Section 194-IA of the Income Tax Act, 1961, every buyer of immovable property (other than agricultural land) is required to deduct TDS at 1% of the consideration or stamp duty value (whichever is higher) if the amount equals or […]
Tax Audit Under Section 44AB: Applicability, Due Date & Penalties Quick Answer Section 44AB of the Income Tax Act, 1961 mandates tax audit for businesses with turnover exceeding Rs.1 crore (or Rs.10 crores if cash transactions do not exceed 5% of total transactions) and professionals with gross receipts exceeding Rs.50 lakhs. The audit report must […]
New Tax Regime vs Old Regime 2026: Which to Choose — Section 115BAC Post-Budget 2025 Quick Answer For FY 2025-26 (AY 2026-27), the new tax regime under Section 115BAC is the default regime, with significantly revised slabs announced in Union Budget 2025 — the basic exemption limit is now Rs.4 lakhs, the highest slab (30%) […]