Tax Health Check for Telangana Businesses: State Taxes, PT and Local Compliance

A tax health check reviews income tax, TDS and GST for any business. For a Telangana business, it should also cover state-level taxes and a few issues that come up often in the local economy. This guide lists what to include.

State GST

• Correct split between CGST and Telangana SGST on intra-state sales, and IGST on inter-state sales.
• Separate reconciliation for each GSTIN, if the business has branches in other states.
• Whether the business is administered by the state Commercial Taxes Department or central GST authorities, and any open notices from either.

Professional Tax

Professional Tax is one of the most frequently missed state taxes. A health check should confirm:

• The business's own enrolment and annual payment.
• Employer registration, deductions from employees, and timely payment and returns.
• Arrears, if any, and the cost of regularising them.

Legacy State Taxes

Businesses that operated before GST may still have VAT, CST or entry tax assessments or disputes pending with the state. These are often forgotten, but can still result in demands.

Local Economy Issues

• TDS on rent for offices and residences in Hyderabad, and on payments to NRI landlords.
• TDS on contractor payments in construction and infrastructure.
• TDS on property purchases, based on the stamp duty value.
• Cash transactions in trading and agriculture-linked businesses.
• Payments to MSME suppliers within the MSMED Act's time limit.

State Incentives

Where the business has received state industrial incentives, a health check should confirm their tax treatment and whether ongoing conditions are being met.

A Checklist

1. Reconcile each GSTIN and confirm the administering authority.
2. Confirm Professional Tax registration and payments.
3. Check for legacy VAT or CST matters.
4. Review TDS on rent, contractors, property and NRIs.
5. Review incentive conditions and tax treatment.

Getting Help

Think Filing performs tax health checks for Telangana businesses, covering state and central taxes.