Umang Aggarwal & Company- Chartered Accountants

31/10/2025

5 Smart Tax Strategies Most Business Owners Overlook (That Can Legally Save You Lakhs)

Most business owners think of tax planning only in March — when the year is nearly over.
But by then, most real opportunities to save have already passed.

True tax planning isn’t about last-minute deductions; it’s about structuring your business decisions smartly from the start.

Here are 5 simple yet powerful tax strategies that are often ignored — but can make a real difference to your bottom line:

1. Choose the Right Business Structure
Your business form decides your tax outgo.
A proprietorship may be simple but limits flexibility.
An LLP allows profit withdrawal without dividend tax.
A private limited company offers better funding access and tax efficiency.
Review your structure as profits grow — it could save you more than you expect.

2. Plan Asset Purchases with Depreciation in Mind
The timing of buying an asset matters.
Assets bought before 31st March get half-year depreciation.
Machinery purchased on 28th March instead of 2nd April could mean ₹70,000–₹80,000 in savings.

3. Balance Remuneration and Profit Share
Distribute profits and remuneration smartly.
Partners’ salaries and directors’ remuneration can reduce total tax impact if planned correctly.

4. Make Investments Through the Business, Not Always Personally
Some deductions apply to business-level investments, like:

Section 80JJAA for new employment

Section 35AD for specific capital expenses

R&D benefits under Section 35

5. Monitor Advance Tax and TDS Closely
Most interest under Sections 234B and 234C is avoidable with timely advance tax and TDS reconciliation.

Key takeaway:
Tax planning isn’t an annual ritual — it’s a continuous process that shapes your financial stability.

01/10/2025

Delayed payments are one of the most common struggles faced by MSMEs. Even after supplying goods or services on time, many businesses are left chasing buyers for months. This directly affects their working capital and growth.
What many business owners don’t know is that the Government of India has provided a powerful remedy – the MSME Samadhaan Portal.

What is the Samadhaan Portal?
Under the MSME Development Act, 2006, if payments are delayed beyond 45 days, MSMEs can file their claims online. The matter is then taken up by the Micro & Small Enterprises Facilitation Council (MSEFC), which has the power to:
Order the buyer to release payment
Levy interest at 3 times the RBI bank rate
Resolve disputes faster than regular courts

This means MSMEs don’t have to suffer in silence – they have a strong legal backing to recover their dues.

Our Recent Success Story:
At M/s. Umang Aggarwal & Company, we recently assisted an MSME client who had nearly ₹48 lakhs pending for 18 months with a large corporate.
We filed their case through the Samadhaan Portal, represented them before the Facilitation Council, and within a few hearings, the buyer agreed to settle the full payment to avoid penal interest. Our client finally got their money back – something they had almost given up hope on.

Why This Matters?
For MSMEs, cash flow is lifeblood. Every rupee stuck in delayed payments can slow down business operations. The Samadhaan Portal ensures that you are not left at the mercy of buyers – you have a structured, legally backed mechanism to enforce your rights.
👉 If you are an MSME facing delayed payments, don’t wait endlessly. Take action – the solution already exists. And with the right professional guidance, you can recover what is rightfully yours.

11/09/2025

01/09/2025

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17/01/2025

💡 Incorporation, Maintenance_of _Company and Dissolution 💡

Incorporating a company is a significant strategic decision that should not be taken lightly. When considering incorporation, it's essential to weigh the long-term implications, especially if the company is not actively operated or is contemplating shutting down.

One of the main reasons for incorporating is to limit personal liability. However, if a company is inactive and the decision is made to shut it down, the costs associated with dissolution can be substantial. These costs may include legal fees, tax obligations, and potential penalties for failing to meet compliance requirements.
Even if the Company is not generating revenue and is contemplating shut- down, regular compliances are to be timely made and not to be ignored and left un-attended thinking that there is no need for compliances when the company is not operational.
It is to be noted that, in case in future the stakeholders of the company decide to shut down the company, they can't proceed until and unless all the pending regular compliances are fulfilled and till the time this fact is realised, it results in heavy late penalties which could have been avoided had the regular compliances been made irrespective of the inoperative status of the company.

Additionally, maintaining an incorporated entity incurs ongoing expenses such as annual fees, bookkeeping, and compliance with regulatory requirements. If the company is not generating revenue, these costs can become a financial burden. Therefore, it's crucial to evaluate the operational viability of the business before making the decision to incorporate, ensuring that it aligns with the overall strategic goals and financial health of the organization.

In summary, incorporating a company should be a well-thought-out decision, considering both the potential benefits and the financial implications of shutting down an inactive entity.

10/12/2024

UAC Tip of the Day !

We are receiving lots of queries regarding receiving of GST notices by taxpayers despite paying the taxes.

On careful examination of the cases, we found that most cases are under litigation due to selecting the wrong HSN code and gst rate for their products or services.

Ensure that you are familiar with the different GST rates applicable to various goods and services. In India, for instance, GST is categorized into five slabs: 0%, 5%, 12%, 18%, and 28%. Understanding which rate applies to your products or services is crucial for accurate invoicing and compliance.
Identify the correct HSN Code for your product or service and corresponding Tax rate.

Additionally, regularly update your knowledge on any changes in GST laws and rates, as these can impact your pricing strategy and tax liabilities. Utilize accounting software that integrates GST calculations to minimize errors and streamline your filing process. This way, you can ensure that your input tax credit (ITC) claims are accurate and that you’re not overpaying or underpaying your GST obligations.

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08/11/2024

If you have paid the GST demand but still getting the Notice , it can be really stressful 😥

No worries, we are here to reduce your stress and provide you with an appropriate solution to this . 🙂

Let's explain the reason for this 💡💡:

Whenever a demand is created on the GST portal as a result of Assessment/ Appeal , it has to be deposited using ''Payment towards demand '' facility and set off against the Demand reference number so that demand gets deleted from Electronic Liability Ledger. 💲💲

However, there is a common practise amongst taxpayers to deposit the demand through DRC-03 Form and close the matter.

However, this is not the correct way ❌️❌️

Until and unless amount paid towards demand is utilised against demand created it will still reflect as unpaid and you will keep getting the notices.

Here is what you need to do ✅️✅️💡

Government has come out with a new form DRC-03A which is now available on the GST Portal using which all demands which have been paid generally through DRC-03 can be adjusted.

●Taxpayers will be required to enter the ARN of the DRC-03 along with the relevant demand order number on the portal.
●Upon entering the ARN and selecting the demand order number of any outstanding demand, the system will auto-populate relevant information of the DRC-03 form as well as from the specified demand order against which the payment is to be adjusted.

😀😀Once the demand is adjusted, the demand will get deleted from the Electronic Liability Ledger and you will no more get any notice for that demand 🏆🏆

Hope this helps 🙂

For any more queries on GST notices, you can reach out to an expert or consultant.

06/11/2024

📢 Important Update: GST Refunds Explained! 💸

Hey everyone! Let’s break down the process of GST refunds, which can be a crucial aspect for businesses. Here’s what you need to know:

1. What is a GST Refund?: A GST refund is the amount that a taxpayer can claim back from the government when the input tax credit (ITC) exceeds the output tax liability. This can happen in various scenarios, such as excess input tax paid, exports, or unutilized ITC.

2. Eligibility for Refunds: Businesses can claim refunds in cases like zero-rated supplies (exports), input tax credit for accumulated ITC due to the inverted duty structure, and when the tax is paid on behalf of a registered person.

3. Application Process: To initiate a refund, taxpayers must file a refund application in Form GST RFD-01 on the GST portal. Supporting documents, such as invoices and payment proof, must be attached. The application must be submitted within two years from the end of the financial year in which the claim arises.

4. Processing Time: The tax authorities are required to process the refund application within 60 days from the date of application. If the refund is approved, the amount will be credited to the taxpayer's bank account.

5. Common Issues: Ensure all documents are in order to avoid delays. Common reasons for rejection include discrepancies in invoices or failure to meet eligibility criteria.

Stay informed and make sure to claim your rightful refunds! For more detailed guidance, consult your tax advisor.

Start-up and Business Consultants | Compliance Consultants | Litigation Support

06/11/2024

📢 Alert for sellers of Long Term Capital Asset
who wish to utilise the sale consideration for purchasing a residential house. 🏠💰

Hey everyone! Let’s talk about Section 54F of the Income Tax Act, which provides significant benefits for taxpayers selling a property. Here’s what you need to know:

1. What is Section 54F?: This section allows individuals and Hindu Undivided Families (HUFs) to claim exemption from long-term capital gains tax when they sell a long-term capital asset (other than a residential house) and invest the proceeds in purchasing or constructing a residential property.

2. Eligibility Criteria: To qualify for this exemption, the taxpayer must not own more than one residential house (other than the new property) at the time of transfer. The new property must be purchased within one year before or two years after the sale or constructed within three years.

3. Exemption Calculation: The exemption amount is proportionate to the amount invested in the new residential property. If the entire sale proceeds are invested, the entire capital gains can be exempted. However, if only part of the proceeds are invested, the exemption will be calculated accordingly.

4. Important Points: It's crucial to note that if the new property is sold within three years of purchase, the exemption claimed will be reversed, and the capital gains will be taxable in the year of sale.

Make sure to plan your investments wisely to take full advantage of this beneficial provision! For personalized advice, consult a tax professional.

06/11/2024

📢 GST Update: Reverse Charge Mechanism (RCM) for Renting of Immovable Property 🏢⚖️

Attention all landlords and businesses! The GST framework has introduced important changes regarding the Reverse Charge Mechanism (RCM) applicable to renting of immovable property.

Here’s what you need to know:

1. What is RCM?: Under RCM, the recipient of the service (tenant) is liable to pay GST instead of the supplier (landlord). This shifts the tax burden and requires careful accounting.

2. Applicability: RCM applies to specific categories of renting services. Make sure to verify if your rental agreements fall under this mechanism.

3. Compliance Requirements: Tenants must ensure timely payment of GST under RCM and file their returns accurately. Non-compliance can lead to penalties.

4. Documentation: Keep proper records and documentation to support your RCM claims. It’s crucial for both landlords and tenants to stay organized.

Stay updated and ensure compliance with the latest GST regulations to avoid any issues. For detailed guidance, consult your tax advisor !

06/11/2024

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