When developing strategies, asking for business loans, keeping accounts, installing software, applying for grants or subsidies, etc., a chartered accountant’s (CA) knowledge in key business-related areas, including laws, finance and taxes, agreements, and so on, might be crucial. Therefore, speaking with a CA while developing a one-person company (OPC) can be extremely helpful because it allows one to clarify key issues upfront rather than getting caught in a trap later.
A CA can simply explain the various governing rules, compliances, and tax regulations that apply to company registration in Chennai so that you can decide the best course of action for your company. In light of those, as mentioned earlier, we go into further detail in this blog article on the roles of a CA in registering an OPC in Chennai to benefit interested readers.
Importance of a CA in OPC Registration
1. A CA assists you in trademarking your goods: A CA knows the technicalities and the method involved in trademarking your unique product with the needed authority. Even before the company is registered, one can obtain the trademark.
2. Assists you in applying for an overdraft or business loan: Your chances of receiving a loan increase when you know a CA is behind your documents and loan application. Additionally, they can address any inquiries from your bank regarding budgeted income and expenses.
3. Aids in submitting ROCs: The Company’s Act of 1956 mandates that every corporation submit its annual accounts and returns within a specific time limit. When you concentrate on making crucial company decisions, a CA can simply handle the numerous forms and facts that must be included when ROC filing in Chennai.
CA’s Responsibilities in OPC Registration
CAs approve the certificates required for company registration procedures. A CA’s involvement is, therefore, essential throughout the registration procedure.
The following is a list of a CA’s key responsibilities in this regard:
1. Approval of DIN
A person cannot be appointed or reappointed by the OPC unless the government has given the individual a director identification number or DIN. A company must deliver all required paperwork to the CA before registration. You must provide an affidavit to authorize someone to sign on your behalf. The CA will digitally sign the paper and immediately provide the DIN online. As a result, it is difficult to obtain the DIN without the CA’s consent.
2. Name approval process
A CA can assist you with locating the company name by the rules outlined in the Companies Act.
The ROC office must approve the name approval process within five business days. But first, the chosen name must receive the CA’s blessing.
3. Drafting of MOA and AOA before company registration
A CA writes the MOA and articles of association (AOA) documents by the Companies Act.
The MOA document will contain information such as the company name, the location of the registered office, the items required for business operations or the items for which the company is applying for registration, the liability of the involved members, and the share capital.
4. Approval of INC7, INC 22, and DIR12
Following the approval of the MOA and AOA documents, the INC7, INC22, and DIR12 documents are examined. Once more, the CA must approve these documents and confirm the information provided in the forms.
5. Planning and preparation
The idea that CAs are only necessary until your firm is fully established is untrue. Even before you have launched your business, you might enlist the assistance of a seasoned CA. In addition to many other things, he can assist you with marketing plans, salary increases, tax-saving investments, and company model evaluation.
Assessing eligibility for OPC registration
A CA is the ideal candidate to evaluate the requirements for OPC registration due to their knowledge and practical training.
Advising on business structure and compliance requirements
A competent and experienced CA can assist you with more than simply tax return preparation.
Employers can begin with one or two employees when they launch a business. You must engage a CA for these one or two employees to ensure you adhere to all taxation regulations, including labour laws, tax deduction at source (TDS), and salary provisions.
Your startup will develop over time, dealing with more complicated issues, including corporate processes and tax matters. Hiring a CA online to handle all such difficulties by providing practical solutions makes sense.
Although individual accountants may also provide you with various services, a CA can advise businesses on sound opportunities due to their expertise and practical training. He can assist you in developing workable business ideas so you may seize the chance and advance.
Preparation of documents and forms
A CA is best positioned to create all the paperwork needed for an OPC’s pre- and post-registration phases.
The registration process for an OPC cannot be successfully finished without a CA’s attestation of the documents that must be submitted during the registration process.
6. Filing and registration
Verification and filing of documents with the ROC
A CA aids with document verification and submission to the ROC. The following is a list of such documents:
- MOA
- AOA
- List of directors
- Consent of the directors
- Statutory declaration
- Notices of the address of the registered office
- A letter of authority for making necessary corrections in the memorandum and articles
Incorporation certificate and PAN/TAN application
A CA assists you in submitting a standard application form to the Ministry of Corporate Affairs (MCA) to apply for incorporation, assign a permanent account number (PAN), and assign a tax deduction and collection account number (TAN).
The PAN and the TAN are mentioned in the certificate of incorporation (COI) that the MCA granted.
Bank account opening and other post-registration formalities
You can open a bank account with any private bank when OPC is incorporated.
While cash payments and receipts may not be allowed to determine your taxable business income under the Income Tax Act of 1961, this is the first and most important thing you must do after receiving a COI from the government.
By taking the following actions, a CA can assist you in opening a start-up business account:
- Submit an online application for a new business account on the chosen bank’s website.
- You can apply at a bank location if the online application is unsuccessful.
- Gather the “know your customer (KYC)” documentation to open the account.
- The bank will complete the necessary account opening procedures and open the new business account.
7. Compliance requirements
Ensuring compliance with statutory and regulatory requirements
A CA can assist the following post-incorporation OPC compliance obligations:
You might receive advice on the design of the name board, the kind of the company’s rubber stamp and letterhead, how to get an OPC PAN card, how to choose an auditor, and how to run an OPC annual general meeting.
Preparation and filing of financial statements and tax returns
The following financial statements must be prepared and filed with the ROC by all businesses:
- Balance sheet as at the end of the financial year;
- Profit and loss account;
- Cash flow statement for the financial year;
- Statement of changes in equity, if applicable; and
- Explanatory notes form part of any document.
You will receive assistance from a CA in creating and submitting the earlier specified financial statements to the ROC.
8. Record-keeping
If you are registered under the taxable regime, the government will urge you to keep proper records of all commercial transactions and registration documents.
You need a CA in this situation because they are the ones who are fully knowledgeable about the regulatory standards for taxes. Maintain accurate accounting records since they will provide all the information you need to understand your company’s past, present, and future state.
9. Accounts management
You can use CAs to aid in the creation of prior analyses. Knowing what happened last month or last week will be more advantageous if you have a customized accounting system. This makes it simple to run into problems and address them before it’s too late.
Spotting and resolving business issues early on is the only indication of a good businessman. It’s part of the business to borrow the articles and pay for them after a month or a few weeks, but if you can’t see the threat coming, that might get you into huge difficulty. As a result, accounting management is essential.
Advisory on tax planning and optimization
A CA’s duty in tax planning is to examine their client’s financial condition and find viable tax-saving possibilities. They can help their clients understand the various legal exemptions and deductions. A CA’s job in tax planning is to counsel and lead their clients throughout the year. They support their clients in choosing assets and spending that will lower their tax liabilities and boost tax savings.
These are some ways a CA can assist you in reducing your tax liability:
Via Section 80D of the Income Tax Act
Via Section 10 of the Income Tax Act and Section 80C of the Income Tax Act by using tax-saving instruments such as the following:
- National saving certificate
- National pension scheme
- Employee provident fund
With other Income Tax Act deductions and exemptions, you can use tax-saving tools by working with a CA. A CA can provide services that can help you save money and grasp India’s intricate tax laws and regulations. A CA’s guidance can make tax planning, which takes place throughout the year, simpler and more efficient.
Annual compliance requirements
According to the Income Tax and Companies Act, an OPC must maintain compliance. So, maintaining compliance for an OPC primarily entails completing an annual return with the MCA and an IT return with the IT department. OPCs may additionally be obliged to abide by TDS laws, GST regulations, VAT or CST regulations, service tax requirements, ESI regulations, and other restrictions in addition to fundamental compliance. Depending on the sector, state of incorporation, number of employees, and sales turnover, an OPC’s compliance requirements may change. A CA can assist an OPC in fulfilling the conditions of annual compliance.
Benefits of hiring a CA for OPC registration
The following sections cover the main advantages of engaging a CA for OPC registration:
1. Expertise in company law and taxation
You should always double-check taxes before paying, and if the end of the fiscal year is approaching, you should take extra precautions. The amount of taxes that must be paid might be reduced with the assistance of an experienced accountant. This results in sound tax advice, saving you from unexpected tax bills.
2. Tax reduction
A CA is a qualified expert in all areas of tax law. He almost always stays abreast of the most recent developments and government tax regulations alterations.
There are various ways to cut taxes legitimately. This could be done by using spouses and partners to offset revenue, changing your VAT system, or altering customer spending. An excellent CA will be able to advise you on which of these techniques you can apply to your company.
3. Timely and accurate compliance
Because of their professional competence in all kinds of tax laws and accounting procedures, a CA may aid you in quick and accurate compliance with pre- and post-registration requirements of a one-person company registration in Chennai.
4. Avoidance of penalties and legal consequences
A significant feature of a CA’s job profile is to complete and submit forms on time. This assists in avoiding penalties and legal implications. It is easy to become confused in the technical jargon of the tax department or lose track of several deadlines.
Even tiny fines have the potential to accrue interest over time. This might be a big loss to your firm. Some small firms have been forced to close because they could not afford to pay the accrued taxes.
5. Access to professional advice and support
A CA could be employed as a consultant as well. With his understanding of the financial arena, he could make accurate predictions about market patterns. This implies that you will make wise investments and maximize your returns.
6. They help you stay focused
Accountants handle more than just accounting; they also handle other parts of your business. They assist you with resource allocation, tax compliance, and, of course, balance sheet preparation. If you try to handle everything independently, you might not have time to concentrate on your company’s key functions, such as sales.
7. They help you find work-life balance
Establishing a work-life balance is difficult for many people, no matter how well-established your firm is. Accountants can handle the menial activities that consume your time and prevent you from spending more time with your family.
8. They ensure you a professional reputation
The ideal accountant will support you and effectively represent your business. This is much more crucial for start-up companies. Building a strong network with banks and other investors may be facilitated by high market value and recognition.
9. They help you in promoting the success of the company
Those who work with established CAs say that it is a vital part of success for them.
10. They provide you with a fresh perspective
Company owners are so engrossed in their everyday operations that they may fail to see the entire picture. Being an outsider in this situation, a CA might offer a new viewpoint you might have missed.
11. They understand taxes
Even though this may seem like common knowledge, keep in mind how quickly laws and regulations can change. It is certainly not easy to keep them all in check. A CA may relieve you of that stress and ensure that your company remains compliant by filing IT returns promptly.
Conclusion
Recap of the role of a CA in OPC registration
The main functions of a CA in the one person company registration procedure are summarized as follows:
- FilingROC
- Obtaining the approval of DIN
- Obtaining name approval
- Drafts MOA and AOA before company registration
- Obtaining the approval of INC7, INC 22, and DIR12 documents
- Assessing the eligibility for OPC registration
- Verification and filing of documents with the ROC
- Applying for an incorporation certificate and PAN or TAN
- Ensuring compliance with statutory and regulatory requirements
- Preparation and filing of financial statements and tax returns
- Accounts management
- Advisory on tax planning and optimization
- Annual compliance requirements
Importance of seeking professional help
It is extremely difficult to complete the registration process for any firm, let alone an OPC, without professional assistance. Hence, you have two options: either hire the CA of your choice or contact a reputable accounting firm.
For a successful registration of your OPC with an accounting company, we advise you to contact Kanakkupillai.com, the website of Govche India Private Limited, for the reasons listed below:
- Since 2007, Kanakkupillai.com has provided individuals and company owners with exceptional financial and legal counselling services. The team is committed, research-driven, and knowledgeable.
- Com has a staff of devoted and highly skilled business analysts, corporate lawyers, company secretaries, chartered accountants, and financial specialists and provides multidisciplinary legal, financial, and business advising services.
Based on our discussion thus far, we believe this blog will be useful to all readers interested in learning more about the functions of a CA during an OPC’s pre- and post-registration processes.
