—Direct Taxation (Income Tax)
Tax Planning & Advisory
Tax-efficient structuring of income, investments, remuneration and business transactions within the law.
Handled by a practising Chartered Accountant or Company Secretary.
Scope of work
Tax-efficient structuring of income, investments, remuneration and business transactions within the law.
Key deliverables
- Tax planning note and liability projections
Governing law
Income-tax Act (1961 / 2025, as applicable to the period)
Frequency
Ongoing / Annual
REGISTRATION ONLY
Tax Planning & Advisory
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- Tax planning note and liability projections
REGISTRATION + COMPLIANCE CARE
Tax Planning & Advisory + Compliance Care
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+ ₹9,599/yr for year-one ROC compliance
- Tax planning note and liability projections
- Financial statements in Schedule III format
- Board report and AGM notice
- Filed AOC-4 with SRN
- Filed MGT-7 / MGT-7A with SRN
- Board and AGM minutes
500+
Companies incorporated
100%
CA/CS-signed filings
4.8/5
Founder rating
—A closer look
Understanding tax planning
Everything below is written for business owners and individuals — what legitimate tax planning looks like, where the real savings usually are, and where planning crosses a line.
What is tax planning?
Tax planning is arranging your affairs — how your business is structured, how you're paid, when you buy or sell, and which regimes and incentives you use — so you pay the tax the law requires and no more. It's forward-looking: most planning only works if it's done before the transaction or year end, not after.
It's different from avoidance schemes and evasion. The Income-tax Act has general anti-avoidance rules, and the department looks at substance, not just form. Good planning uses the choices the law deliberately offers.
Where planning usually makes a difference
Most real savings come from a handful of areas:
- Entity structure
- Whether a business runs as a proprietorship, LLP, or company changes the tax rate, how profits reach the owners, and what's deductible.
- Regime choices
- Companies choose between the concessional 22% rate and the normal regime; individuals between the new and old regimes.
- Founder remuneration
- The mix of salary, dividend, and partner remuneration affects total tax across the business and the owner.
- Timing
- When assets are bought, income is recognised, or investments are sold can shift tax between years or rates.
- Incentives
- Deductions for eligible startups, certain industries, and exports, where conditions are met.
- Capital gains
- Holding periods, exemptions for reinvestment, and set-off of losses.
- Compliance as planning
- Deducting TDS, paying dues on time, and keeping records avoid disallowances that cost more than most planning saves.
A simple example
A Hyderabad consultant earns ₹60 lakh a year as a proprietor, taxed at slab rates with surcharge. Reviewing options, the consultant compares continuing as a proprietor under presumptive taxation, forming an LLP, and forming a company taxed at 22% and drawing salary and dividends. The analysis includes compliance costs and future plans to hire and take investment. The consultant chooses a Private Limited Company, sets a reasonable salary, and retains profit for growth — and puts the decision in place from the start of the next financial year, not mid-year.
Why it matters
Planning is where most avoidable tax is lost or saved:
- Structure decides the rate
- The same profit can be taxed very differently depending on the entity and how it's paid out.
- Timing is often irreversible
- Many options — like regime choices or reinvestment exemptions — must be used by set dates.
- Avoiding disallowances
- Missed TDS or late PF payments can add more tax than planning ever saves.
- Cash flow
- Planning advance tax and credits reduces interest and ties up less cash.
- Staying on the right side
- Aggressive schemes attract scrutiny, penalties, and general anti-avoidance rules. Planning should hold up on substance.
- Growth decisions
- Hiring, raising funds, or selling a business all have tax consequences worth understanding first.
- Law changes
- The new Income-tax Act, 2025 and annual budget changes can make old arrangements less efficient.
Who is this for?
- Founders choosing or reviewing their business structure
- Business owners deciding how to pay themselves
- Companies comparing the 22% regime with the normal regime
- Individuals with significant investments, property, or capital gains
- Anyone planning a major transaction, like selling a business or property
We don't advise on schemes designed only to avoid tax. Planning should work because the underlying arrangement is real.
How business structures compare for tax
A simplified view for FY 2025-26:
| Aspect | Proprietorship | LLP / firm | Company (115BAA) |
|---|---|---|---|
| Tax rate on business profit | Owner's slab rates | 30% plus surcharge and cess | 22% plus surcharge and cess |
| Tax when profit reaches the owner | None further | Profit share exempt; remuneration taxed | Salary taxed at slab; dividends taxed at slab |
| Presumptive option | Available within limits | Not for LLPs | Not available |
| Compliance cost | Lowest | Moderate | Highest |
| Suits | Small, owner-run businesses | Professional firms, partnerships | Businesses raising funds or retaining profits |
What we'll need from you
- Current financials
- Recent accounts and tax returns for the business and owners.
- Plans
- Growth, hiring, fundraising, or sale plans for the next few years.
- Owner's position
- How owners want to take money out, and their other income.
- Investments and assets
- Property, shares, and other significant holdings.
- Upcoming transactions
- Anything planned, like a property sale or business restructuring.
- Existing arrangements
- Current agreements, like salary structures or intercompany charges.
Advice is quoted per engagement, depending on complexity.
How we plan
Tax planning follows a clear process:
- 1
Understand the position
We review current tax, structure, and plans.
- 2
Identify options
We list the legitimate options available — structure, regime, timing, incentives.
- 3
Model the numbers
Each option is modelled, including compliance costs and future plans.
- 4
Check the risks
Options are tested against anti-avoidance rules and practical risk.
- 5
Recommend and document
We recommend a course of action, with reasons, in writing.
- 6
Implement on time
Changes are put in place before the relevant dates, with filings and agreements.
Keeping it efficient
Planning isn't a one-time exercise:
- Review annually
- Revisit arrangements after each budget and each year's results.
- Keep documentation
- Agreements, board resolutions, and valuations support the position if questioned.
- Stay compliant
- TDS, advance tax, and filings on time protect deductions.
- Watch the new Act
- Check arrangements against the Income-tax Act, 2025 as it takes effect.
- Plan before transactions
- Speak to your advisor before, not after, a major sale or purchase.
- Keep substance
- Arrangements should reflect what actually happens in the business.
Benefits and responsibilities
Benefits
- Lower tax through choices the law provides
- Decisions modelled before they're made
- Fewer disallowances and interest charges
- Arrangements that hold up on substance
- Plans updated as the law changes
Responsibilities
- Share plans early, before transactions
- Implement changes before the relevant dates
- Keep agreements and records
- Stay compliant with TDS and filings
- Review arrangements each year
- Avoid arrangements without real substance
—FAQ
Questions business owners actually ask us
Sometimes. A company's 22% rate is lower than top personal rates, but money taken out as salary or dividends is taxed again, and compliance costs rise. It usually makes sense for higher profits, retained earnings, or plans to raise funds. We model it for your numbers.