How to reduce the compliance burden

Hello,

First, given the nature of your business operations, I am pretty unsure as to why did you opted for Pvt company mode rather than a proprietorship or any other alternative mode.

Second, you should not have taken registrations for PT, ESI, PF etc in such a hurry when you were not at all eligible for the same.

However you can still surrender the same to bring down you compliance requirements. Also we can help you respond back in respect of tax notice and try to get the demand cancelled depending on nature of penalty invoked therein.

Third, it would be prudent to abondon corporate route and move back to another feasible model where compliance burden is lesser.

Feel free to reach out through telephonic mode for detailed discussion and help on all aspects of this query.

Best Regards, 

Hi

You can close the ESI and PF registrations. However, PT would be required.

There are two registrations for PT - PTEC for the company for which annual payment of 2.5k is to be done. And PTRC for company with employees. You can surrender PTRC if there are no employees in your company.

- If company is registered in Maharashtra then PT is required. For more details on PT, concern local CA. For ESI and EPF, file closure application immediately.

Hi, 

It appears that your company is recently incorporated. Therefore, the company has obtained it's PF and ESIC registrations with the incorporation certificate.

Please see my responses for registrations hereinbelow:

1. PF: PF registration is required only if a company has minimum 10 employees.   Since your company has no employees, PF is not applicable.

2. ESIC: ESIC registration is applicable only if a company has minimum 20 employees. So, it goes out of picture too.

3. PTEC & PTRC: These are the mandatory registations for a company irrespective of strength of employees. Therefore, the comapny needs to comply with this requirement. Every director needs to pay an amount of INR 2500 every year as professional tax. It's a State lavy, so if the company has offices in different States, then each director has to pay INR 2500 for each such State. 

You are suggested to connect with a labour law consultant for responding to the PT authority in relation to penalty imposed.

You may reach out to us for plan your annual and event based compliances.

Trust this helps.

Hi

Yes you can surrender  EPF ESI registration. But PT is mandatory.

 Profession Tax (PT) is a tax levied on the employment and Profession by respective State Government in India

Every business establishment must obtain the Professional Tax - Employer Registration / Enrolment Certificate (EC) within 30 days of commencement of business. The employer must pay professional tax of Rs.2500.00 to the Government annually.

Please have a phone consultation for details discussion.

Yes you might close all these accounts after looking at local laws.

Also I would suggest if you wish to reduce compliance to convert it into an LLP rather than company.

The registration are generally pre applied when you register your company and as per law if you don't fulfill conditions you may remove this registrations.

Hope you find the above information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you

Hi,

Under the new Initiative of the Ministry of Corporate Affairs (MCA) using the SPICe+ Form for Companies Incorporation, PAN, TAN, PF and ESI Registrations are allocated mandatorily. Profession Tax is also Mandatory for Maharashtra.

GST Registration option is also available in the SPICe+ Form. However, it is optional.

PAN & TAN are obviously mandatory for every Company.

Regarding PF & ESI, the provisions will be applicable only if you hit the no. of employees threshold under respective Acts. (10 for ESI, 20 for PF). So, you need not worry about PF & ESI.

Regarding Profession Tax, there are 2 components.

Registration Certificate (RC) for deducting PT from employees' salaries. This is applicable only if you have employees who are crossing the Threshold Limit set by respective State's PT Act.

Enrolment Certificate (EC) as an Employer / Business. Most states have made this Mandatory for Private Limited Companies in most Companies. I guess the Notice you have got must be for not paying the Annual Enrolment Amount.