Accounting Outsource to India

In general, outsourcing is a trend that has been on the rise due to several obvious advantages. The market place is a high-pressure environment. With competitors constantly cutting into your profit margins and market share, the only area that you can try and out do them is by being more operationally efficient. For the best result to be achieved, resources need to be collaborated and optimized. Therefore, the CFOs of many companies have deemed it practical and smart to entrust their accounting services to third party firms who specialize in these services and understand regulatory and compliance requirements for legal and taxation purposes.

With India emerging as a much sought-after outsourcing destination and meeting all global benchmarks, any companies worldwide, especially in the United States have outsourced their accounting services here. Many successful companies have popped up across the country in response to this rising demand. They have carved a special niche for themselves and have been successfully helping American companies streamline their operational models and gain better control over their data and analytics. Account Outsourcing companies in India have successfully helped their clients align their long-term goals with their everyday operations.

The outsourcing companies are comprised of a network of professionals dedicated to providing competent accounting services that include the standardization of certain accounting practices including recurrent transactions which makes the overall financial processing much simpler and clear-cut. In the long run it is highly cost-effective. Companies can leverage the collective expertise of this group of specialists and tap into their extensive industry knowledge. They can shift their focus entirely to the core of the business and its long-term goals as opposed to being engaged in the everyday drudgery of bookkeeping andaccounting service.

These organisations being highly customer-centric understand the specific requirements of their client and come up with the most effective solutions which usually tends to be beyond the competency of the company to do it on its own. Even some CPAs today outsource accounting services to overseas firms to save time required to train and supervise accountants and labor costs to hire and pay them. The fundamental logic behind outsourcing is increasing productivity and efficiency.

Also, many small or medium sized firms may not be able to procure in-house support for their financial services. Outsourcing with the US may not be viable either. For such companies outsourcing in India becomes an attractive option where they can acquire the services of a thoroughly professional organisation at very affordable prices and successfully run their business without unnecessary hassles. Even some larger firms may consider this to further reduce their operational cost.

There is also the added advantage of scalability and agility. There are times when your company will need to expand and consolidate; others where you may need to cut back either due to economic restraints or to rapidly pursue a short-term goal. This will be enabled due to the customized professional support that an outsourcing firm of experts can provide

How to restructure your income, investments and expenses to optimise your tax

A Person, a 32-year-old manager in a Chartered account firm, is worried about his tax outgo. Lamba's company deducts more than Rs 10,000 as TDS every month from his salary. Lamba should rejig his salary structure. Instead of the high special allowance, his employer can put up to 10per cent of his basic salary in the NPS under Sec 80CCD2. He should also ask for perks such as newspaper and phone allowance which are tax free on submission of bills. These two measures will reduce his annual tax bill by Rs 20,000.

Lamba's tax planning also needs a rejig. He is putting too much in the PPF. Instead, he should put Rs 50,000 in the NPS under the new Section 80CCD1b. That will cut his yearly tax by Rs 10,000. He should also consider investing in ELSS funds or go for a low-cost online Ulip for better returns. Lamba is repaying a home loan but cannot avail benefits since the house is not self-occupied. He should give it out on rent and enjoy full deduction of the Rs 3.62 lakh he pays in interest. The rent (Rs 7,000 per month) will be taxed after a 30per cent standard deduction. But the deduction of the interest will cut his overall tax by almost Rs 62,500.

ICAI vision 2030

"World's leading Accounting body,          

 a Regulator and Developer of trusted and independent professionals

with world class competencies

in Accounting,assurance,taxation,finance and business advisoryservices"

ICAI Vision 2030 emphasizes four elements:

a) To be World’s leading accounting body: ICAI envisions becoming the world’s leading

accounting body by playing a predominant role in setting world class standards in identified

service areas developing thought leadership and research that addresses concerns of countries,

developed, developing and under-developed.

b) A regulator and developer of Trusted and Independent Professionals: ICAI will lay

further thrust on its regulatory and developmental role that sets the highest standards of

professional and ethical conduct of its members as a core value. Each and every member of ICAI

will not only have the obligation to maintain exacting standards of clarity, transparency and

disclosure and present an independent, informed and balanced opinion but ICAI will make

examples of delinquent members to ensure this core value is embedded in the DNA of its

members.

c) With World Class Competencies: ICAI will ensure that members have the right skills to

serve global markets which are regularly updated and are relevant in the changing economic

order. ICAI will provide holistic education, effective practical training and continuous

professional development to ensure that the knowledge base of the profession keeps pace with

emerging global practices and innovations.

d) In accounting, assurance, Indirecttaxation, finance and business advisory

services: ICAI will strengthen facilities available for providing education, training and

continuous updation of knowledge as also research and development relevant in current

times to establish thought leadership in these areas where members of ICAI have been

providing services.

It sets out its Mission as

ICAI is a leverange technology and infrastructure and partner with its stakeholders to:

•        Impart word class education, training and professional development opportunities to create global professionals.

•        Develop an independent and transparent regulatory mechanism that keeps pace with the changing time.

•        Ensure adherence to highest ethical standards

•        Conduct cutting edge research and development in areas of accounting, assurance, taxation, finance and business advisoryservice

•        Establish ICAI members and firms as indian multi-national service provider.

The Mission 2030 of ICAI lays focus on following key elements:

a) Global Professionals: ICAI will develop skilled professionals with competencies to service

clients not only within India but across the globe that requires technical skills as also cross

cultural appreciation and understanding of global needs. As one of the largest producers of CAs in the world, we will make sure our members can take the rightful place in the global talent pool.

b) Independent and Transparent Regulatory Mechanism: ICAI will further strengthen and

visibly demonstrate its regulatory role through proactive, visible, timely and unbiased action. We

will create public awareness and sensitize all stakeholders to the effectiveness of the

quasijudicial role of ICAI and ensure inclusion of wider section of users of member services in carrying out ourrole as regulator.

c) Highest ethical standards: ICAI will continue to inculcate highest ethical standards amongst

its members to assist them in upholding the values that the accounting profession stands for. We

will continue to include and emphasize ethical values as part of the education and training of

students and members.

d) Cutting-edge research and development: ICAI will become the hub of valued Thought

leadership and innovation in the field of accounting, assurance, taxation, finance and business.

ICAI will devote resources and create an enabling environment to become the predominant

contributor to setting standards across the world in these fields. We will support, fund and take

up research on issues that impact has locally and globally.

e) Multi-national Service Providers: ICAI will facilitate the Indian professional services firms

and professionals to establish as multi- national service providers and help them in harnessing

global opportunities on one hand and assist them in building capabilities on the other.

Account outsourcing companies in India - Six things to know about the new income tax return forms

Having dropped the controversial provision for mandatory disclosure of foreign trips and dormant bank accounts, the Finance Ministry has finally come out with new and simplified income tax return (ITR) forms. The simplified ITR forms have been brought after the earlier version was opposed by the industry, MPs and assessees for its cumbersome disclosure norms.

The ITR forms,available in all "Indirect  taxation firms in India" which were notified last month by the CBDT for the current assessment year, had specific columns for banks accounts, IFSC Code, names of joint account holders and foreign visits, including the ones paid by companies.

The good news now is that apart from doing away with some controversial provisions, the new forms -- ITR 2 and ITR 2A -- will have only three pages and other details will have to be filled in schedules, according to a Finance Ministry statement issued recent .. 

However, "as the software for these forms is under preparation, the new forms are likely to be available for e-filing only by the third week of June. Accordingly, the time limit for filing these returns is also proposed to be extended up to August 31, 2015, for which a separate notification will be issued," says Rama Karmakar, senior tax professional at EY India.

Here are the 6 things you need to know about the new ITR forms:

1) Providing a big relief to assessees, the new ITR forms have been reduced to three. The number of pages for the new ITR forms has been reduced from 14 pages to 3, making it easier for income tax assesses. The new forms, known as ITR 2 and ITR 2A, will therefore consist of only 3 pages. Any other details that must be filled will have to be included in schedules," informs Adhil Shetty, founder & CEO of BankBazaar.com.

2) Currently individuals/HUFs with income from more than one house property and capital gains are required to file Form ITR-2. "A new ITR 2A form is proposed which can be filed by an individual/HUF that has income from more than one house property, but does not have any income from capital gains, income from business/profession, foreign assets/foreign income," says Karmakar.

3) An individual/Hindu Undivided Family (HUF), who has exempt income without ceiling limit (other than agricultural income exceeding Rs 5,000), can now file Form ITR 1 (Sahaj). Earlier, an individual with exempt income (e.g. dividend income) of more than Rs 5,000 was required to file ITR-2.

4) With regard to foreign travel details, it is now proposed that only the passport number, if available, will be required to be furnished in ITR-2 and ITR-2A.

5) The Finance Ministry has done away with the disclosure of details of dormant accounts which are not operational during the last three years. "As regards bank account details in all these forms, only the IFS code, account number of all the current/savings account which are held at any time during the previous year will be required to be filled-up. The balance in accounts will not be required to be furnished," says the Finance Ministry statement.

6) An individual, who is not an Indian citizen and is in India for business, employment or on student visa, will not mandatorily be required to report the foreign assets acquired by him during the prior years in which he was non-resident, if no income is derived from such assets during the relevant financial year.

According to tax experts, the above changes proposed in the ITR forms will provide respite to the taxpayers, including all expatriate employees working in India.

Government has simplify new Income Tax Return Forms

Having dropped the controversial provision for mandatory disclosure of foreign trips and dormant bank accounts, the Finance Ministry has finally come out with new and simplified income tax return(ITR) forms. The simplified ITR forms have been brought after the earlier version was opposed by the industry, MPs and assessees for its cumbersome disclosure norms. 

The ITR forms, which were notified last month by the CBDT for the current assessment year, had specific columns for banks accounts, IFSC Code, names of joint account holders and foreign visits, including the ones paid by companies. 

The good news now is that apart from doing away with some controversial provisions, the new forms -- ITR 2 and ITR 2A -- will have only three pages and other details will have to be filled in schedules, according to a Finance Ministry statement issued recently. 

However, "as the software for these forms is under preparation, the new forms are likely to be available for e-filing only by the third week of June. Accordingly, the time limit for filing these returns is also proposed to be extended up to August 31, 2015, for which a separate notification will be issued," says Rama Karmakar, senior tax professional at EY India. 

Here are the 6 things you need to know about the new ITR forms: 

1) Providing a big relief to assessees, the new ITR forms have been reduced to three. "The number of pages for the new ITR forms has been reduced from 14pages to 3, making it easier for income tax assesses. The new forms, known as ITR 2 and ITR 2A, will therefore consist of only 3 pages. Any other details that must be filled will have to be included in schedules," informs Adhil Shetty, founder.

2) Currently individuals/HUFs with income from more than one house property and capital gains are required to file Form ITR-2. "A new ITR 2A form is proposed which can be filed by an individual/HUF that has income from more than one house property, but does not have any income from capital gains, income from business/profession, foreign assets/foreign income," says Karmakar. 

3) An individual/Hindu Undivided Family (HUF), who has exempt income without ceiling limit (other than agricultural income exceeding Rs 5,000), can now file Form ITR 1 (Sahaj). Earlier, an individual with exempt income (e.g. dividend income) of more than Rs 5,000 was required to file ITR-2. 

4) With regard to foreign travel details, it is now proposed that only the passport number, if available, will be required to be furnished in ITR-2 and ITR-2A.

5) The Finance Ministry has done away with the disclosure of details of dormant accounts which are not operational during the last three years. "As regards bank account details in all these forms, only the IFS code, account number of all the current/savings account which are held at any time during the previous year will be required to be filled-up. The balance in accounts will not be required to be furnished," says the Finance Ministry statement. 

6) An individual, who is not an Indian citizen and is in India for business, employment or on student visa, will not mandatorily be required to report the foreign assets acquired by him during the prior years in which he was non-resident, if no income is derived from such assets during the relevant financial year. 

According to tax experts, the above changes proposed in the ITR forms will provide respite to the taxpayers, including all expatriate employees working in India, by simplifying the process of the tax return filings. For more information click here

Gross Tax Collections During 2014-15 Stand at Rs. 12,45,037 Crore and thus Registering a Growth of 9% during the period as Compared to FY 2013-14

The Provisional Accounts for the year ended 31st March, 2015 have been complied on the basis of March data and anticipated adjustments received from the different Ministries. These are the provisional figures and may undergo certain changes during the final compilation of accounts after Audit.

1.  Fiscal Indicators:

As a result of prudent policies and commitment to fiscal consolidation, the fiscal deficit at the end of 2014-15, stands at Rs. 5,01,880 crore which is 98% of the projected figure in RE 2014-15. Fiscal deficit as a percentage of GDP is 4.0% as against the RE of 4.1%. (4.4% for the previous year 13-14). The Union Government is firmly committed to path of fiscal consolidation and this is a step forward.

Revenue deficit at the end of 2014-15 is Rs.3,58,306 crore which is 99% of the projected figure in the RE 2014-15  and is 2.8% of the GDP as against the RE of 2.9%. (3.2% for the previous year FY13-14)

2. Receipts:

Gross Tax Collections at Rs. 12,45,037 crore has shown a growth of 9% (Rs.1,06,303 crore) as compared to FY 2013-14. The gross tax collections is 9.8% of GDP.

While, Devolution of tax collections to States at the end of 2014-15 is Rs.3,37,808 crore which is higher by Rs.19,578 crore over the previous year 2013-14 while the Non Tax Revenue stands at Rs.1,96,959 crore (90% of RE)

Non Debt Capital Receipts which includes disinvestment stands at Rs.43,439 crore (103% of RE) and has shown an increase of 4% as compared to the previous year’s collection of Rs.41,865 crore.

3. Expenditure

Plan Expenditure at the end of 2014-15 stands at Rs.4,35,621 crore while Non-Plan Expenditure during the same year has been Rs.11,91,140 crore (99.8% of RE)

for more information visit us at http://www.neerajbhagat.com

Registering a company – what challenges will you face post-formation?

Registering a company - what challenges will you face post-formation?

The process of Company registration in India is a very simple one. In fact with Company Formation Made Simple it is just 4 simple steps. It is a quick process too, normally done within 3 hours. However here at Made Simple Group we are always looking to keep young businesses prosperous, so we want to help prepare entrepreneurs for their new venture.

We want to help businesses grow so we provide a range of advice and guides, including our ‘Business Start Up Guide’ to give you the best chance of success. As a result, we thought it would be beneficial to share some of the challenges you will face post-formation.

So, what are the things you should be most aware of once you start your business adventure?

Common Smaller Problems

Certain problems are very common, as a result you are much more likely to face them. It might not be possible to avoid the challenges, but you may very well be better prepared if you know they are coming.

Some common challenges include:

Over Planning – Let’s get this straight, planning is important – but only if it’s followed by doing. You might find that your business progress stalls if you spend too much time in the planning phase, this is a big problem. Try and find a balance, allow planning time – but remember that the execution of those plans is what really matters.
Relying on Clients – When you first start getting clients, you are going to be a bit dependent on them. This is especially true if you have a large percentage of your income depending on a single client.
Customer Service – Over-committing and under-delivering is a common problem, with a keen need to impress there are potential pitfalls for not satisfying customers. Customer service guru Ruby Newell-Legner states that “it takes 12 positive experiences to make up for 1 unresolved negative experience”.
There are many other common problems, but these are some of the more interesting ones – and ones you might not have necessarily expected. Other common problems include money management, cash flow and finding the right staff.

Deeper Larger Problems… And Solutions

Smaller company problems are much easier to manage, or at least focus your attention on, than the broader and more nebulous ones. There are many of these, some of them include:

Marketing – Keeping a customer base is a big challenge, as is gaining potential new customers. Neeraj Bhagat, a business mentor with experience at Citigroup and Bank of America said “Figuring out the right marketing channels is key for businesses to be successful in the future” – so identifying customer wants and tailoring your marketing around this is a significant challenge.
Reputation – Sometimes in business there is a bad decision made – and your reputation suffers. If people judge your company to be in the wrong, it will negatively affect this – but on the other hand a positive impact can be made too. Your integrity and trust starts from within the company, so making a proactive effort to foster a positive culture is a good idea. This is great for employees too, where reputation is most strongly felt.
Competition – One of the larger challenges faced by a business is remaining competitive, or even being competitive in the first place. Neeraj Bhagat & Co. concludes “The ease of starting a business creates a much broader level of competition” and that “will make it more difficult for businesses of all sizes to retain customers who can change their suppliers with the click of a mouse”. The challenge covers marketing as well as reputation, but also counts on the focus of the business owner themselves.
Generally speaking, these are much deeper and larger problems and they generally don’t go away very quickly, in fact you should regard marketing, reputation and competition as something of an ongoing challenge.

Solutions

Although it is very important to be aware of challenges, the real trick lies in finding solutions. Adapt and evolve to become a better business, or you may find that you’re left without the edge you need to survive in the business world.

Did you find this useful? If so please be sure to comment and let us know. Make sure that you check out the rest of our blog for more useful hints and tips. 

Now Registeration of new company become easy

Narendra Modi government eases incorporation of company or business, process to take just 1 form starting today 

Company Registration in NEW DELHI: Entrepreneurs keen on setting up new enterprises will be able to incorporate one by filing just one form starting Friday against eight separate forms earlier, as part of the government’s drive to make it easier to do business in the country.

The corporate affairs ministry will from May 1 have an integrated company incorporation form to make compliance and reporting easier and convenient for corporates.

“Name availability, allotment of Director Identification Number (DIN), company incorporation and commencement of business will now be possible through a single form,” said a senior ministry official who sought anonymity.

The new form, called INC-29, will be available on the MCA website. This is part of the government’s drive to improve India’s ranking on the globally tracked parameter of ease of doing business. This is a priority area for PM Narendra Modi, who has made it a personalmission to improve India’s scores on this parameter. The government wants to reduce the time taken to register a company in India to one day.

Modi has said he wants India to be at 50th position in two years among countries ranked by the World Bank in its annual Ease of Doing Business survey.

The Ease of Doing Business survey captures the ease with which one can open, conduct and close down businesses. The country was ranked 142 among 189 economies by the World Bank in 2015, down two notches from the preceding year. In 2006, when the index was launched, India was ranked 116. On the crucial ‘Starting a Business’ parameter, the country was ranked 158, again down two places from the preceding year.

Entrepreneurs have long complained about the various hassles they face in setting up businesses in India, so much so that many startups prefer to incorporate their businesses in countries such as Singapore. The reasons for this range from a multitude of orms to a plethora of permissions from central and state governments.

Currently, businessmen seeking to register a new company are required to fill eight forms to complete the incorporation, a process which, besides being cumbersome, also takes a lot of time. Even if it’s a single-person company, the range of forms required to be filled included separate applications for obtaining DIN, obtaining a DSC (digital signature certificate), form INC-1 for approval of the name of the company, for more visit us at:http://www.neerajbhagat.com