A reference guide to business compliance in India — the regulators involved, what each requires, how obligations attach to turnover and headcount thresholds, and how the Income-tax Act, 2025 changes the section numbers behind familiar rules.
An Indian business answers to several regulators at once, and they do not coordinate. This guide explains what each one wants, what triggers the obligation, and where the recent change in the income tax law alters what you have to cite even though it rarely alters what you have to do.
The single largest change for FY 2026–27 is the Income-tax Act, 2025. It replaced the 1961 Act with effect from 1 April 2026. Almost every familiar section number has moved: return filing from 139 to 263, tax audit from 44AB to 63, presumptive taxation from 44AD to 58, TDS from the 194 series to 392–394, and the 80C deduction to 123. The obligations are largely the same; the citations are not.
Goods and Services Tax
When it applies. Turnover above ₹40 lakh for goods or ₹20 lakh for services in most States. Registration is compulsory regardless of turnover for inter-State supply of goods, e-commerce operators, persons liable under reverse charge, casual and non-resident taxable persons, and input service distributors.
What it requires. Tax invoices in series; an outward supply return by the 11th; a summary return and payment by the 20th; monthly reconciliation of input tax credit against the auto-populated inward statement; e-invoicing above the notified turnover; e-way bills for consignments above the applicable value; an annual return by 31 December.
Where it goes wrong. Input tax credit is the recurring problem. Credit generally requires the supplier to have declared the supply, so your entitlement depends on somebody else's compliance. Reconciling monthly is the only practical defence.
Income Tax
What it requires. Advance tax in four instalments under sections 407 and 408; books of account where section 62 applies; audit under section 63 above the turnover threshold; and a return by the date in the section 263(1) table.
The regime choice. Section 202 sets a concessional regime that now applies by default. It carries lower slab rates, a standard deduction of ₹75,000 under section 19, and a rebate of ₹60,000 under section 156 where total income does not exceed ₹12,00,000 — but almost no other deductions. Opting out restores deductions at higher rates. The choice should be computed, not assumed.
Audit thresholds. ₹1 crore of turnover, rising to ₹10 crore where cash receipts and cash payments each stay within 5% of the total.
Tax Deducted and Collected at Source
Deduction from salary sits in section 392; the unified table of resident rates in section 393; collection at source in section 394; the account number and quarterly statements in section 397; and default in section 398. Deposit by the 7th, except March which is 30 April. Statements quarterly. The severe consequence is not the interest but the disallowance of 30% of the expenditure where tax was deductible and not deducted.
Companies Act and the Registrar
Four board meetings a year, no more than 120 days apart. An AGM within six months of the year end. AOC-4 within 30 days of the AGM and MGT-7 within 60. DIR-3 KYC annually by 30 September. Statutory registers at the registered office. The additional fee for late filing is ₹100 per day per form and is not capped, and three consecutive years of non-filing disqualifies every director for five years.
Labour and Employment
Provident fund at 20 or more employees, state insurance at 10 or more for those within the wage ceiling, both deposited by the 15th. Professional tax as the State notifies. Shops and establishments registration, generally within 30 days of commencing. Minimum wages as notified for each category and skill level. An internal complaints committee at ten or more employees, with an annual report to the District Officer. Statutory bonus within eight months of the year end.
The four labour codes remain a live issue. The Codes on Wages, Industrial Relations, Social Security, and Occupational Safety, Health and Working Conditions consolidate a large number of existing statutes. Because labour is a concurrent subject, operative effect depends on both central notification and each State framing its own rules, so the position varies by State. Until the code applicable to your State is in force, the existing statutes continue to govern — check the position for each State you operate in rather than assuming a uniform national answer.
Sector-Specific Requirements
- Food. FSSAI registration or licence for every food business operator, by scale.
- Import and export. An import export code from the DGFT; a letter of undertaking for zero-rated export without payment of tax; a registration-cum-membership certificate to claim scheme benefits.
- Manufacturing and imports of notified products. Certification from the Bureau of Indian Standards under the applicable scheme.
- Factories. Licensing and the safety, health and welfare requirements of the Factories Act.
Intellectual Property
Not compliance in the strict sense, but it behaves like it in one respect — the cost of acting late is much higher than the cost of acting early. Register a trade mark before you build a reputation on the name; the alternative is an opposition or an infringement dispute after you are committed to it. Patents require novelty, so any public disclosure before filing can be fatal to the application.
How to Structure Compliance in Practice
- Map what applies. Work through the thresholds — turnover, headcount, activity, entity type — and write down which obligations you actually have. Most businesses over-comply in one area and miss another entirely.
- Put every date in one calendar at the start of the financial year, with a named owner and a reminder.
- Reconcile monthly rather than annually, for input tax credit and for tax deducted. Both have windows that close.
- Review thresholds each quarter. Crossing a turnover or headcount line creates new obligations, sometimes immediately.
- Keep records to the longest applicable period — eight years under the Companies Act, six under the Income-tax Act, seventy-two months under GST.