TThe 100% Export Oriented Unit scheme (STPI scheme) is made for setting up of software development and IT Enabled Services (ITES) firm in India for 100% Export. A distinctive feature of this STP/EHTP scheme is that it provides single point contact services for member units, which enables them to conduct exports operations at a pace commensurate with global standards.
Any company who does IT/ITES exports through Data communication links needs to submit the Softex Form for certification. For getting the Softex certification by STPI (which is the Designated Authority), the companies have to become STP members by either registering under STP scheme or as NON-STP unit with STPI.
An STP Unit can be set up by :
- An Indian company.
- A Subsidiary of a Foreign Company.
- A branch office of Foreign Company.
Benefits of Registration for Software Technology Park on India
- Approvals are given under single window clearance mechanism.
- Projects costing upto Rs.100 millions with Indian investment & NRI funds on non-repatriable basis are cleared by local STP authorities at Centre level itself.
100% foreign equity is permitted.
- All the imports in the STP units are completely duty free.
- Import of Goods on loan, Free of cost & lease basis is permitted.
- Re-export of capital goods brought on loan/lease/free of cost is permitted.
- Domestic purchases are completely excise duty free.
- >Domestic purchases are eligible for the benefit of deemed exports to the suppliers.
- The sales in the Domestic Tariff Area (DTA) are permissible upto 50% of the export in value terms.
- STP units are exempted from corporate income tax.
- Net Foreign Exchange Earning as a percentage of exports (NFEP) and minimum export performance (EP) would be as follows
Important statutory compliance for STP units are listed below as reference
Each of such unit is required to maintain separate accounts for its operations. Separate annual balance sheet will have to be made for each such unit which would be become a part of the main balance sheet of the company. For maintaining separate accounts the following will have to be done :
- Maintenance of Separate Cash & Bank book and corresponding vouchers.
- Maintenance of sales invoices.
- Maintenance of Fixed Assets register.
- Maintenance of Foreign Inward Remittance Certificate file (FIRC's) & Bank Realisation Certificate file where the original of the FIRC's and BRCs are kept.
- Maintenance of contract file, where copies of contracts received from buyers are maintained.
- Preparation of yearly balance sheet for the unit which would ultimately become a part of the balance sheet of the company.
Each unit is required to maintain separate bank accounts for its operations. The units is free to have as many bank accounts as it desires but shall have to designate a single branch of bank whom all export documents will be submitted. In other words the work of handling of all shipping documents and realisation of export proceeds will have to be entrusted to this designated bank branch.
Our Service Offerings
Ledger offers services for opening, or setting up of a company or registering a company in Software Technology Parks of India. With involved companies being 100% tax exempted as per section 10A of Income tax Act, 1961, our team of experts provides service support for establishing of software technology parks in India. The STPI registration services includes preparation of application and project report for –
- Registration of units under STPI scheme
- Application to set up a 100% EOU
- Execution/acceptance of LUT
- Filing of Softex Forms
- Accounts maintenance for each STPI Unit
APPLICATION TO STPI TO SET UP A 100%EOU.
Our STPI Registration and Consultancy services also involves –
- Preparation of application for Custom Private Bonded warehouse under section 58.
- Permission for manufacturing u/s 65.
- Obtaining licenses under respective sections of custom Act 1962.
- Filling bond B-17 for import / indigenous duty free purchases.
- Registration for Import clearance under S-16.
- Preparing paper work involving clearing of import consignments from Docks /Cargo /ICDS/CFS under duty exemption schemes.
- Central Excise registration under rule 9 of Central Excise Rules – 2002.
- Obtaining necessary NOC from STPI for consignment on every import/indigenous purchase of goods.
- Preparation & obtaining of CT-3 for duty free indigenous purchases.
- And other auxiliary matters as well as paper work as required from time to time.
DOCUMENTS TO INCLUDE.
Application Form in the form prescribed.
- Memorandum of Association and Article of Association.
- Board Resolution for setting up STP Unit and persons authorized to sign and submit the application form.
- Resume of person heading the operation/CEO.
- Detailed project report/ Business plan consist of:
- Company profile.
- Background of Promoters.
- Units Area of expertise/Services offered.
- Marketing Strategy / marketing Arrangements.
- Manpower plan.
- Plans for Future.
- Brief write up on the parent Company and the activities proposed to be carried out by the Indian entity. (In case foreign equity participation)
- List of proposed Capital goods to be acquired from abroad and within India.
- Details of foreign collaborator (whether financial or technical)
- Copy of floor plan of the Unit certified by an architect.
- Copy of the rent agreement if any.
- Copy of invoice of the Internet service provider.
- Financials statement like.
- Cost of project & Means of finance.
- Projected P&L A/C.
- Projected Balance Sheet.
- Projected Cash flow/fund flow statement.
- Export workings- (As per Transfer Pricing guidelines where ever applicable)
- Financials for a period of 5 year projecting income from operations, Capital expenditure & cash Flows.
- Detail for aggregate foreign exchange comings & outgoings for first 5 years.
- Detail for estimated number of employees and wage bill for first 5 years.
- Other documents like Copy of service agreement signed with parent company / clients/ PO with clients/ Master Service Agreement.