Accounting & Taxation Essentials for Entrepreneurs

Saturday 10, December, 2016. 2.30pm – 5.30pm

Navi Mumbai

•Are you confused as to how to approach accounts being a startup.•Are you not sure of the applicable compliance for your startup. •Are your accounts in a messy shape or you haven’t started at all?Accounting has always taken a last seat in the priorities because: -

• Thought process …Lets first earn something to account for• It’s a Cost Center

Believe us accounting is like a dashboard of a running car… although not compulsory but truly essential….

Also as a CEO / CXO, one have NO choice but to put his head around the numbers to do sane business…….

It is really SIMPLE and you actually can DIY (Do It Yourself) as far as the basics are concerned.

Significance of Accounting

5 Basic Accounting Disciplines for Start-Ups: Maintain list of Invoices…. Revenue is the key!!

Maintain Cashbook…. Cash is king!!

Maintain a bankbook & do a daily reconciliation… Control adds

up to credibility!!

Maintain an expense file… Get your budgets right!!

Maintain an Asset Register…. Know what all you have!!

As CEO / CXO, one has no choice but to put his head around NUMBERS consistently…..

What you see daily is what grows…. Sales, Profits, Valuations, Cash

Busin

ess

Taxation

5 Basic Accounting Disciplines for Start-Ups:

• Maintaining list of Invoices:– Should be maintained without fail.– Invoice is hard cash blocked in services or goods.– Should be maintained in a proper format – Proper format enables faster collection of cash– Other points like the following are critical from a

service tax, VAT & excise calculation• Trail on revised rates• Cancellation of invoices• Modification in qty etc

5 Basic Accounting Disciplines for Start-Ups:

• Maintain a Cash Book …as Cash is King– Is a register which helps you track your petty cash

on a daily basis– It should have a receipt & an expense column,

which nets off to a balance. – Best practice is to balance this end of day daily

and match the balance with physical balances – Multiple cash books can be maintained if

required for multiple locations / persons.

5 Basic Accounting Disciplines for Start-Ups:

• Maintain a Bank Book & do a daily Reconciliation– Gives clarity on Bank position i.e. the time between

the deposit of a cheque to amount getting reflected.– Excel sheet with the following details to be maintained• date of issue / deposit of Cheque, • date of clearing with all routine details like name, bill etc..

– More helpful for planning. Could be of some help to take strategic financial decisions as well.

5 Basic Accounting Disciplines for Start-Ups:

• Maintain an Expense file:– List of all expense items to be maintained with

• Date of the bill / receipt• Name of Party & Purpose• Amount & Taxes separately punched

– Best Practice is to • Noting the cheque nos and date of invoice• Amount of Cheque • Do claim credit of excise duty, service tax & VAT.

Please AVOID KACCHHA invoices

5 Basic Accounting Disciplines for Start-Ups:

• Maintain a Fixed Asset Register– Records of Fixed assets is a must have – Foll. Details should be maintained• Date of Purchase & Vendor name• Model No. & Warranty period • Maintenance schedule & insurance etc..

A Good Tracking system can differentiate your Business vis-à-vis others when it comes to funding .

Know your compliance… (KYC)

• Service Tax: -

• VAT: -

• Profession Tax: -

• TDS : -

Taxation in a Nutshell

Reverse Charge Mechanism

Particulars Service Tax VAT CST

Applicable Geographies All India LevelLocal (Inside Maharashtra)

Interstate (Outside Maharashtra

Applicability On Delivery of ServicesIllustrationNet Sales (Rs) 1000 1000 1000Tax (%) 15% 12.50% 2.00%Tax (Rs) 150 125 20Gross Sales (Rs) 1150 1125 1020

Purchases (Rs) 800 800 800Tax (%) 15% 12.50% 2.00%Tax (Rs) 120 100 16Gross Payables 920 900 816Set-Off Available Yes Yes No

Tax Payable to Authorities 30 25 20

Effective Cost of Purchases 800 800 816

On Transfer of Property in Goods

TDS

Applicable to: Salaries, Professional services, Contracts, Advertising, Renting

•Credit Available at the end of the year against Income Tax Payable

Payments to Non-residents:•Ascertained on a case to case basis•Certificate form no 15CA & CB to be issued

Particulars Tax - % Amount (Rs.)Inovice Raised 1000Service Tax 14% 140Gross Value of Invoice 1140TDS Payable to Government 10% 114Net Payable to Vendor 1026

Get in Touch With Us@apmhtaxalerts– for 140 character crisp reply

For further details contact:Mitesh KatiraCell: +91-9833777556E mail: mitesh@apmh.in

www.apmh.in/knowledge

www.facebook.com/APMH & Associates

Date Invoice No Client Name Channel Partner Services Provided Net Amount Tax Gross Amount25-May-14 2014-15/001 Apple Axis Services Routine Maintainance 100 10 110