The Startup Service Trap: How Once-Promising Enablers Are Exploiting Founders, and What You Can Do to Stay Safe

 by Anurag Sharma Founder & CEO of Taxellence Consultants and Taxellence AI | Taxation & Compliance 

In the vibrant chaos of India's startup ecosystem, countless dreams are built every day—startups solving real-world problems, driven by passionate founders ready to take on the world.
But as thousands rush to incorporate companies, apply for GST, trademarks, compliances, and pitch decks, an unregulated parallel industry has emerged:
👉 Startup service enablers—firms promising fast, low-cost compliance, legal, and registration services.
They started out as digital disruptors. But today, many have become digital exploiters.

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🔍 What Are Startup Service Enablers?

These are third-party firms or platforms offering services like:

• Company/LLP registration

• ROC compliance

• ITR, GST filing

• Legal document drafting

• CA/CS/Legal consultancy

• Startup India registration

• Trademark & IP filings

• Funding documentation

Their pitch?

🔹 “Affordable”
🔹 “Fully online”
🔹 “End-to-end support”
🔹 “Expert CAs and Lawyers on call”

But reality often tells another story.

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💣 What’s Really Going Wrong?

1. Post-Payment Negligence

2. Hidden Charges & Misleading Packages

3. No Qualified Professionals

4. Zero Accountability

Once you pay, you’re often left in limbo. Promised timelines are missed. Documents get misplaced. Calls go unanswered. No SLAs. No escalation.

“I filed my ROC with a well-known platform. It’s been 2 months. The deadline passed, penalties apply—and I still don’t have closure.” – a founder from Mumbai

That “₹4,999 for Pvt. Ltd registration” ad? Doesn’t include stamp duty, DSC, PAN, professional fee, resubmission help, or follow-ups.

You end up paying 3–4x more than advertised.

Behind the curtains, many tasks are executed by trainees or sales staff, not qualified professionals. Even crucial forms like MGT-7, AOC-4, or DPT-3 are handled without care, leading to ROC notices or compliance lapses.

There's usually no signed engagement letter, no TAT-bound deliverable commitment, and no customer grievance cell.

Try asking for a refund, and you’ll be met with silence.

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📉 Consequences for Founders

Risk	Impact
Missed Deadlines	ROC penalties, government scrutiny, non-compliance blacklisting
Faulty Filings	Rejections, resubmissions, audit flags
Cash Burn on Repeated Payments	Your runway is wasted on fixing their errors
Emotional Stress	Lost trust, time, and energy better spent on building your startup
Loss of Reputation	Investors, vendors, and clients lose faith in your company’s seriousness

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⚖️ Pros & Cons of Working With Startup Service Enablers

Pros	Cons
Cost-effective (if you're lucky)	Hidden costs + unexpected add-ons
Faster paperwork in some standard cases	No flexibility for complex or special cases
One-stop-shop appeal	Lack of depth and customisation
Easy digital access	Over-automation with little human support
24/7 platform interface	Poor post-sale service, hard to reach executives
Scalable solutions	Not relationship-driven; quantity > quality

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🛑 How to Identify Red Flags Early

Before you commit, look for these warning signs:

🚩 Too Good to Be True Pricing
🚩 No direct access to a CA/CS/Lawyer
🚩 No engagement letter or service contract
🚩 Pushy sales teams offering 'limited time' discounts
🚩 Ambiguous timelines or promises like “it’ll be done soon”
🚩 No clear escalation matrix
🚩 No refund policy stated in writing
🚩 No reviews from verified clients, or fake testimonials

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✅ How to Protect Yourself and Stay Smart

Here’s a founder’s checklist before hiring any service enabler:

📋 Pre-Onboarding:

• ✔️ Check who’s executing your task (CA, CS, Lawyer?)

• ✔️ Get timelines and scope in writing

• ✔️ Ask for a breakup of costs, including taxes and govt fees

• ✔️ Read verified reviews on LinkedIn, Twitter, Google

• ✔️ Ask for past work samples or client references

🔄 During Engagement:

• ✔️ Track every deliverable via email or project tracker

• ✔️ Record calls if serious delays occur

• ✔️ Raise delays/escalations in writing early

• ✔️ Don’t hesitate to switch service provider mid-project if negligence persists

🧠 Long-Term Strategy:

• ✔️ Build a relationship with an ethical CA/Law firm

• ✔️ Invest in a hybrid model: automation + human expertise

• ✔️ Set reminders for ROC/GST/ITR deadlines

• ✔️ Educate yourself on basic compliance—don’t fully outsource blindly

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🌟 Choose Professionalism Over Popularity

In a world full of noisy platforms and exaggerated promises, the real differentiator is ethics.

At Taxellence Consultant India Pvt. Ltd, we’re not here to sell you pre-made packages or run campaigns of fake urgency. We offer:

✅ In-house CAs, lawyers & financial advisors
✅ AI-backed tools with human review
✅ Transparent pricing, no surprises
✅ Founder-level accountability
✅ Tailored compliance + tax strategies
✅ Refund policies and clear SLAs
✅ Regional language support for better communication

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🔚 Final Word

India doesn't need more startup enablers. It needs startup guardians—professionals who understand that behind every incorporation form, there’s a dream, a family, a vision.
Choose wisely.
Because the wrong service partner can cost you more than money—it can cost you momentum.

The Double-Edged Sword: Commercialization in Personal and Professional Life- by Anurag Sharma

Founder and CEO of Taxellence Consultants India  & Taxellence AI

Commercialization, introducing new products or services into the market, has become an undeniable force shaping our personal and professional lives. It's a powerful engine driving innovation and economic growth, but its pervasive influence also casts a long shadow, impacting our values, relationships, and overall well-being.

The Allure and the Pitfalls: Pros and Cons

In Personal Life:

Pros:

• Increased Access and Choice: Commercialization floods the market with a vast array of goods and services, offering consumers unprecedented choice and access to products that cater to diverse needs and desires. From the latest gadgets to specialized food items, we have more options than ever before.

• Improved Standards of Living: The drive for profit often leads to innovation and improvements in product quality and efficiency. This can translate to a higher standard of living with access to better healthcare, more convenient technologies, and a wider range of entertainment options.

• Convenience and Efficiency: Commercialization fosters the development of services that save time and effort, from online shopping and delivery services to meal kits and automated home systems. This convenience can free up time for leisure and personal pursuits.

• Information and Connectivity: The commercialization of communication technologies and the internet has connected people globally, providing access to information, fostering social connections, and creating new avenues for learning and personal development.

Cons:

• Materialism and Consumerism: A strong emphasis on consumption can lead to a materialistic mindset, where personal worth and happiness are increasingly tied to possessions. This can fuel a cycle of endless wanting and dissatisfaction

• Erosion of Non-Commercial Values: As more aspects of life become commodified, non-commercial values like community spirit, genuine relationships, and intrinsic motivations can be overshadowed by transactional thinking.

• Increased Pressure and Competition: The constant exposure to marketed ideals of success and happiness can create pressure to conform and compete, leading to anxiety, stress, and a feeling of inadequacy.

• Superficiality and Authenticity Concerns: The curated nature of commercialized experiences, particularly in social media, can lead to superficial interactions and a blurring of the lines between authentic self-expression and manufactured personas.

• Privacy and Data Exploitation: The commercialization of online platforms and data collection raises significant privacy concerns, as personal information becomes a valuable commodity, potentially leading to manipulation and exploitation.

In Professional Life:

Pros:

• Innovation and Economic Growth: Commercialization is a primary driver of innovation, as businesses compete to develop new and better products and services. This fuels economic growth, creates jobs, and improves overall productivity

• Specialization and Efficiency: The pursuit of profit encourages specialization and the development of efficient processes, leading to higher quality goods and services at potentially lower costs.

• Global Markets and Opportunities: Commercialization facilitates the expansion of businesses into global markets, creating new opportunities for growth, collaboration, and the exchange of ideas and talent.

• Career Advancement and Financial Rewards: In a commercialized environment, individuals with valuable skills and innovative ideas often find opportunities for career advancement and significant financial rewards.

Cons:

• Increased Competition and Pressure: The professional world becomes highly competitive, with constant pressure to perform, innovate, and stay ahead. This can lead to burnout and a focus on quantifiable metrics over intrinsic value.

• Ethical Dilemmas: The drive for profit can sometimes lead to ethical compromises in business practices, product development, and marketing.

• Job Insecurity and Automation: The constant pursuit of efficiency can lead to automation and job displacement in certain sector.

• Focus on Profit Over People: In highly commercialized environments, decisions may prioritize profit maximization over employee well-being, work-life balance, and social responsibility.

• Commodification of Skills and Labor: Individuals may feel their skills and labor are reduced to mere commodities, valued primarily for their economic output rather than their intrinsic worth or contribution.

A Historical Lens: 19th Century vs. Early 20th Century

The impact of commercialization has evolved significantly over time.

19th Century:

• Early Stages of Industrialization: Commercialization was primarily driven by the rise of industrial production and the expansion of markets. This era saw the mass production of goods that were previously handcrafted, leading to increased availability and affordability.

• Emerging Consumer Culture: While consumerism was nascent compared to today, the 19th century witnessed the beginnings of a shift towards a culture where purchasing and owning goods became more commonplace, particularly among the burgeoning middle class.

• Professional Life Shaped by Industry: Professional life was largely tied to the growth of industries like manufacturing, mining, and agriculture. Opportunities were often concentrated in these sectors, and career paths were more defined by hierarchical structures within these organizations.

• Limited Global Interconnectedness: While trade existed, global interconnectedness was limited by slower transportation and communication technologies. The impact of commercialization was more localized or regionally focused.

Early 20th Century:

• Mass Production and Advertising: The early 20th century saw the rise of mass production techniques (like the assembly line) and the development of sophisticated advertising, further fueling consumer culture.

• Expansion of Service Industries: Alongside manufacturing, service industries began to grow, creating new professional opportunities in areas like retail, entertainment, and emerging technologies (like the automobile and early aviation).

• Increased Urbanization and Changing Lifestyles: Urbanization led to new social structures and lifestyles, further influenced by commercially available goods and entertainment.

• Growing Global Trade and Competition: Advances in transportation and communication began to foster greater global trade and competition, impacting both personal consumption patterns and professional opportunities.

The Dawn of AI: A Positive Catalyst?

Artificial intelligence (AI) is rapidly transforming various aspects of life, and its impact on commercialization presents both opportunities and challenges. However, if harnessed ethically and thoughtfully, AI has the potential to mitigate some of the negative consequences of commercialization and amplify its positive aspects.

Positive Impacts of AI:

• Personalized Experiences Without Manipulation: AI can enable highly personalized products, services, and information delivery based on individual needs and preferences, potentially reducing the need for mass marketing and manipulative advertising. For example, AI-powered recommendation systems can suggest genuinely relevant products rather than relying on intrusive or misleading tactics.

• Increased Efficiency and Productivity for Better Work-Life Balance: AI-driven automation can handle repetitive and time-consuming tasks in professional life, freeing up human workers for more creative, strategic, and fulfilling work. This could lead to improved work-life balance and reduced stress.

• Ethical Consumption and Sustainability: AI can facilitate more informed and ethical consumption choices by providing transparent information about product origins, environmental impact, and labor practices. AI-powered supply chain management can also optimize resource use and reduce waste.

• Enhanced Creativity and Innovation: AI can act as a powerful tool for creativity and innovation in various fields, assisting with research, design, and problem-solving, potentially leading to breakthroughs that benefit society as a whole rather than solely driven by profit.

• Improved Access and Inclusivity: AI can help create more accessible and inclusive products and services for people with disabilities and diverse needs, expanding the benefits of commercialization to a wider population. For instance, AI-powered translation and accessibility features can break down barriers to information and participation.

• Data-Driven Insights for Social Good: AI can analyze vast datasets to identify societal needs and challenges, enabling businesses and organizations to develop commercially viable solutions that also contribute to social good. For example, AI can optimize resource allocation for disaster relief or predict and prevent health crises.

However, realizing these positive impacts requires careful consideration of ethical implications, data privacy, and the potential for bias in AI algorithms. A human-centered approach to AI development and deployment is crucial to ensure that this powerful technology serves to enhance human well-being and create a more equitable and sustainable future within a commercialized world.

Beyond Automation: Taxellence AI's Human Touch Redefines Tax Solutions

 By Anurag Sharma  Founder and CEO of Taxellence Consultants India private limited

In the increasingly automated world of tax management, many platforms promise efficiency through algorithms. 
 While these solutions offer speed, they often fall short in providing the nuanced understanding and strategic guidance that complex tax scenarios demand. 

Taxellence AI, a revolutionary platform that recognizes the critical need for human expertise to complement the power of Artificial Intelligence – a stark contrast to solutions that heavily rely on pure automation.

For businesses and individuals seeking truly effective tax strategies and compliance, the limitations of purely automated systems are becoming increasingly apparent. While these platforms can handle routine tasks, they often lack the critical thinking, contextual awareness, and adaptability required to navigate intricate tax laws and unique financial situations. This is where Taxellence AI offers a distinct advantage.

The Missing Piece: Human Expertise in an AI-Driven World

Taxellence AI is built on the fundamental belief that the optimal tax solution lies in the intelligent collaboration between AI and seasoned human professionals. We leverage AI for its unparalleled ability to process vast amounts of data, automate repetitive tasks, and identify initial patterns. However, we understand that true tax optimization and peace of mind require the strategic oversight and personalized guidance that only human experts can provide.

Consider the limitations of a purely automated approach:

• Lack of Contextual Understanding: Tax laws are complex and often require interpretation based on specific circumstances. AI alone may struggle with nuanced situations.
• Inability to Provide Strategic Advice: Algorithms can process data, but they cannot offer the tailored financial strategies that a human expert can develop based on individual or business goals.
• Limited Adaptability to Unique Situations: Every financial situation is different. Purely automated systems may not be equipped to handle complexities that fall outside standard parameters.
• Absence of Personalized Support: Dealing with tax matters can be stressful. A human touch provides reassurance, clarity, and personalized support that an automated system cannot replicate.

Taxellence AI: The Intelligent Evolution of Tax Solutions

Taxellence AI addresses these shortcomings by integrating human expertise at every crucial step:

• AI-Powered Efficiency, Human-Driven Strategy: Our AI algorithms streamline data processing and identify key insights, which are then analyzed and contextualized by human tax professionals to develop personalized strategies.
• Complex Scenario Navigation with Human Insight: When dealing with intricate tax situations, our human experts provide the critical thinking and deep understanding necessary to navigate regulations effectively.
• Personalized Guidance Beyond Automation: We believe in empowering our users with knowledge. Our human experts offer clear explanations and tailored advice, ensuring you understand your tax obligations and opportunities.
• Quality Assurance Rooted in Expertise: Human professionals review AI outputs, ensuring accuracy and applying their judgment to provide reliable and trustworthy results.

The Taxellence AI Advantage: Beyond Simple Automation

By prioritizing the synergy of AI and human expertise, Taxellence AI offers benefits that purely automated solutions may struggle to match:

• Accuracy with Understanding: AI handles the data, while humans ensure the interpretation and application are correct within your specific context.
• Efficiency with Strategic Direction: AI saves time on routine tasks, allowing human experts to focus on providing high-level strategic advice.
• Comprehensive Support, Not Just Processing: You benefit from the power of technology and the personalized guidance of a dedicated professional.
• Confidence in Compliance: Our dual-layered approach minimizes errors and ensures adherence to complex tax regulations.

The Choice is Clear: Embrace Intelligent Collaboration

In the realm of tax management, the choice is becoming increasingly clear. While automation offers certain efficiencies, it often lacks the critical human element necessary for truly effective and personalized solutions. Taxellence AI offers a smarter approach – one that harnesses the power of AI while recognizing the indispensable value of human expertise.

If you're seeking a tax solution that goes beyond simple automation and provides the strategic guidance and personalized support you need, it's time to experience the Taxellence AI difference.

Ready for a smarter, more human-centric approach to tax? Info@taxellence.co.in ,

anuragsharma@taxellence.co.in 

Starting Up Smart in 2025: From Idea to Impact + Global Innovation Trends

 By Anurag Shrama, CEO & Founder, Taxellence Consultants India Private Limited  | April 2025

The startup landscape in 2025 has transformed into a complex, opportunity-rich, but highly competitive space. Whether you're launching a tech solution from Gurugram or bootstrapping a SaaS tool in Bangalore, one thing’s certain — innovation isn’t optional. It's survival.

 

For entrepreneurs, the game has changed — and the rules demand clarity of purpose, execution agility, and strategic global awareness. 

At the heart of this transformation lies the evolution of how startups are conceived, built, and scaled. The journey from a simple idea to a product that delivers real impact is now more streamlined — yet more demanding. A great idea today isn’t enough. It must be backed by validation, quick prototyping, and the intelligent use of technology. In a world saturated with solutions, differentiation now lies in execution, not just innovation.

Start With a Pain Point, Not Just an Idea

Startups are increasingly being built around actual pain points rather than abstract ideas. Founders are encouraged to spend more time with their prospective users, listening and learning, before writing a single line of code. This “problem-first” approach is yielding better outcomes than ever, as customers seek highly specific, contextual solutions — especially in sectors like fintech, health tech, edtech, and compliance tech.

MVP First, Always

In 2025, speed and validation beat perfection.

The Minimum Viable Product (MVP) strategy continues to dominate early-stage development, but the way MVPs are built has changed. With the rise of no-code platforms and generative AI, founders can now test and validate products within days, rather than months. It’s no longer about building a perfect product — it’s about building the right product, quickly. In 2025, agility beats perfection every time.

Goal: Achieve Problem-Solution Fit before chasing Product-Market Fit.

Automate Early with AI, Think Global, Build Local

AI is no longer a luxury. It’s infrastructure and thanks to digital public infrastructure and cloud-native platforms, Indian startups can now serve the world from Day 1.

Another fundamental shift is the integration of AI, machine learning, and automation into the very fabric of new businesses. 

Artificial Intelligence is not a trend anymore — it’s a foundational layer. Whether it’s used for automating workflows, managing customer service, or analyzing user behavior in real-time, Startups that embed intelligent systems early on are gaining significant operational advantages.

From a geographic and economic standpoint, 2025 has also brought the India vs China vs Global innovation debate to the forefront.

India is rapidly emerging as a global innovation powerhouse. With its cost-effective and highly skilled tech talent, robust digital infrastructure (such as UPI, DigiLocker, and ONDC), and a startup-friendly policy ecosystem, Indian startups are finally building for both Bharat and the world. This dual-market capability — solving hyperlocal problems with global scalability — is positioning India as a strategic hub for innovation, particularly in fintech, AI, and edtech.

China, on the other hand, continues to excel in deep tech, manufacturing, and scale-based innovation. However, its geopolitical positioning and tightening data regulations have made global expansion more challenging for its startups. While domestic R&D remains strong, China faces increasing scrutiny from Western markets, making collaboration and cross-border scaling more difficult.

Globally, the US, Europe, and Israel remain hotbeds of innovation, especially in biotech, advanced AI, and clean tech. Yet, these markets are also facing saturation in key verticals, stricter regulatory frameworks, and higher operating costs. As a result, startups in these regions are shifting toward high-value niche markets and collaboration with emerging economies for manufacturing, services, and AI deployment.

Ongoing tariff wars and geopolitical tensions have reshaped global startup dynamics. Investors are now shifting focus from aggressive scaling to resilient, regionally anchored models. 

Raise Capital Smartly (Or Don’t Raise at All)

Investor behavior 

    In the post-pandemic world and especially after the funding slowdowns of 2022–2024, investor behavior has undergone a dramatic transformation. The once hyper-aggressive, "growth-at-any-cost" culture has given way to a more thoughtful, data-driven, and impact-focused approach. 2025 investors aren’t just writing cheques — they’re conducting due diligence with precision, betting on substance over hype, and asking tougher questions.

Investor sentiment in 2025 is conservative — founders who show profit paths get better valuations.

Bootstrap Until You Have Traction: Why 2025 Belongs to Scrappy Founders

What does “bootstrap until traction” really mean?

It means building your business with minimal external funding — using personal savings, early revenues, or small-scale angel backing — until you’ve proven:

Real demand for your product or service,

A functional business model,

And ideally, some repeat customers or revenue.

It’s not about starving your startup. It’s about staying lean, focused, and in control until you’ve earned the leverage to raise money on your terms.

Case in Point: Zoho & Zerodha

Both Indian tech giants were bootstrapped — and profitable — before they ever thought of outside capital.

• Zerodha, now India’s biggest brokerage, was built with no VC money. Their founder Nithin Kamath focused on solving real trader problems and reinvested early profits into scale.

• Zoho built a global SaaS empire from Chennai without chasing Silicon Valley — all while focusing on product quality and user value.

Their stories prove that bootstrapping isn’t a compromise — it’s a founder superpower.

Final Word:

1. Smart Capital Wins:  Founders today must remember that capital is no longer scarce, but smart capital is.

2. India's digital public infrastructure, and geopolitical shifts, international VCs are betting heavily on India in 2025. Sectors like:

• MSME automation platforms,

• Health & wellness tech,

• Climate resilience tools, are getting increased attention from US, Japanese, and Middle Eastern funds.

Startups in India and Southeast Asia are gaining attention as alternatives to China, driven by supply chain diversification. The result? Valuations are more conservative, but founders with solid unit economics and clear value propositions are attracting smarter, more patient capital.

 In 2025, don’t just build a product. Build a system that solves a real problem, scales intelligently, and adapts globally.

You don’t need millions in funding.
You need clarity, speed, and focus.
That’s how you go from Idea → Impact in today’s world.

Introduction to AI in the Professional World: A Blessing or a Curse?

By Anurag Sharma    

Founder and CEO of Taxellence Consultants  India private limited 

Artificial Intelligence (AI) is no longer a futuristic concept—it is an integral part of the modern professional world. From automating processes to optimizing business operations, AI is transforming industries at an unprecedented pace. According to a report by PwC, AI is expected to contribute up to $15.7 trillion to the global economy by 2030, with significant growth in sectors such as healthcare, finance, and manufacturing.

                                                            

In India, AI adoption is on the rise. The National Association of Software and Service Companies (NASSCOM) predicts that AI and automation could boost India’s GDP by $500 billion by 2025. The government has also launched initiatives like the National AI Strategy and AI-powered projects in sectors like agriculture and healthcare. 

 AI’s Growing Influence: Facts and Figures:

• The global AI market is expected to reach $1.8 trillion by 2030, growing at a CAGR of 37.3% from 2023 to 2030. (Source: Grand View Research)
• n India, AI adoption could add $967 billion to the economy by 2035, with sectors like IT, healthcare, and manufacturing leading the way. (Source: Accenture)

Despite its promise, AI is a double-edged sword. While it boosts efficiency and opens new opportunities, it also raises concerns about job security, ethical biases, and economic disparity. 

and still,  AI continues to shape the professional landscape, it raises a critical question: Is AI a blessing or a curse? Let’s take a balanced look at the blessings and curses of AI in the professional world.

The Evolving Role of CA Services: Value or Profit?

 

  CAs were seen as trusted advisors—guardians of financial health and growth. 

Over the years, the role of Chartered Accountant (CA) services has undergone significant changes, leaving individuals and small-scale businesses questioning whether the focus has shifted from value-driven solutions to profit-centric practices. 

Today, however, many feel abandoned by a profession that once prioritized their needs.

The Issue: Profit Over Purpose

The CA profession, like many others, has not been immune to the pressures of commercialization. 

Unfortunately, this shift has led to practices that prioritize revenue over meaningful client relationships, resulting in several alarming trends:

1. Generic Solutions Lacking Relevance: Many firms now offer standardized services that fail to address the specific needs of individual clients or small businesses.

2. Minimal Engagement with Smaller Clients: A focus on high-revenue accounts often leaves smaller clients with inadequate support and limited interaction.

3. Reduced Emphasis on Strategic Guidance: Instead of acting as financial partners, many CAs restrict themselves to basic compliance, neglecting areas like growth strategies, financial optimization, and long-term planning.

4. Rising Costs, Declining Value: Escalating fees without a corresponding increase in value have left individuals and small businesses questioning the worth of these services.

The Consequence: A Growing Disconnect

The effects of this profit-driven mindset are felt most acutely by individuals and small-scale businesses who rely on professional guidance to navigate their financial landscapes. Without personalized support, many find themselves:

1. Overburdened with Compliance Challenges: Constantly grappling with regulatory requirements and frequent policy changes, small-scale businesses often fall behind on compliance, leading to penalties and additional stress.

2. Losing Out on Growth Opportunities: Without strategic financial advice, these businesses miss crucial opportunities to optimize costs, streamline operations, or expand sustainably.

3. Facing Increased Financial Vulnerability: Mismanaged taxation and unoptimized financial structures make individuals and businesses alike more susceptible to financial instability.

4. Experiencing Erosion of Trust: Repeated experiences with generic and overpriced services lead to skepticism about the profession’s ability to deliver meaningful value.

These challenges collectively widen the gap between clients’ expectations and the services they receive, leaving many feeling isolated and unsupported in critical financial decisions.

Taxellence Consultants: Bridging the Gap

At Taxellence Consultants India (TCIPL), 

We are redefining the relationship between CAs and their clients. 

Our mission is to restore trust and provide services that genuinely empower individuals and small businesses.

 Here’s how we do it:

1. Customized Solutions for Unique Needs

2. Affordable Expertise for All

3. Beyond Compliance: Real Value Creation

4. Empathy and Long-Term Partnership

Recognizing the financial constraints of smaller clients, we ensure:
Transparent and fair pricing structures.
Accessible advice and support, regardless of the client’s size or budget.
Identify opportunities for cost reduction and efficiency improvements.
Provide strategic insights that drive sustainable growth.
Empower clients to make informed decisions.

Support their growth, every step of the way.

We believe in the power of personalization. By understanding each client’s specific challenges and goals, we deliver: Tailored financial strategies that align with individual and business objectives and Practical solutions designed to address real-world challenges.

Our role extends far beyond filing taxes and ensuring compliance. We aim to offer proactive tax planning to maximize savings. 

At Taxellence, we see ourselves as partners in our clients’ journeys. By fostering relationships built on trust, empathy, and mutual respect, we aim to simplify complex financial matters.

Making a Difference: Empowering the Underserved

Taxellence Consultants takes pride in addressing the critical gaps left by traditional CA services. We focus on empowering individuals and small-scale businesses through:

1. Innovative Financial Roadmaps: By designing tailored strategies, we enable our clients to achieve clarity and direction in their financial goals.
2. Expert Compliance Management: Our meticulous approach ensures that our clients remain compliant with all regulatory requirements, reducing stress and risk.
3. Proactive Opportunity Identification: We actively identify opportunities for growth and optimization, ensuring our clients capitalize on every advantage.
4. Strengthened Financial Resilience: Through thorough analysis and planning, we help our clients build robust financial structures that stand the test of time.

Our commitment goes beyond providing services—we aim to instill confidence, foster trust, and equip our clients with the tools and insights they need to thrive in an increasingly complex financial landscape.

The Way Forward

The time has come to demand more from CA services. Individuals and small-scale businesses deserve advisors who prioritize their success, not just their billing. Taxellence Consultants is committed to this vision, offering services that truly make a difference.

If you’re ready to experience financial services that deliver value and trust, connect with Taxellence today. Together, we’ll build a brighter financial future.

Inheritance Tax or Capital Gains Tax in India 2024: A Detailed Guide

By Anurag (Director, Taxellence Consultants India Private Limited )

India’s taxation system is ever-evolving, and when it comes to inherited wealth and capital gains, there are some important aspects you need to be aware of.

This blog aims to provide a comprehensive overview of the current laws related to inheritance or capital gains taxation in India for 2024, referencing the Income Tax Act, 1961.

We’ll dive into the tax implications of inheritance or capital gains in 2024

Inheritance Tax in India: What You Need to Know in 2024 

India no longer imposes an inheritance tax. The Estate Duty Act, which taxed the transfer of wealth upon a person’s death, was abolished in 1985. This means when you inherit property, shares, or other assets in India, you do not have to pay any direct tax on the inheritance itself.

This is not the end of the story.

Capital Gains Tax on Inherited Assets:

 Even though there’s no inheritance tax, you may still face a significant tax burden when you decide to sell the inherited assets.The Income Tax Act, 1961, imposes capital gains tax on the profits earned from selling property, shares, or other inherited assets.

Types of Capital Gains

1. Long-Term Capital Gains (LTCG): If the inherited asset is held for more than 36 months before selling (for immovable property), the gains are considered long-term and taxed at 20% with indexation benefits. Indexation allows you to adjust the acquisition price of the asset for inflation, which can significantly reduce your tax liability.

2. Short-Term Capital Gains (STCG): If you sell an inherited property or asset within 36 months of acquiring it (for immovable property), the gains are considered short-term and taxed at your applicable income tax slab rate.

3. For financial assets like shares and mutual funds:

• The holding period to qualify for long-term capital gains is 12 months. 
• Long-term capital gains on equity shares are taxed at 10% if they exceed ₹1 lakh in a financial year.

How Capital Gains Tax Applies to Inherited Assets

While inheriting assets itself is not taxable, selling them is. Here’s how capital gains tax applies to different categories of inherited assets:

1. Inherited Property (Land, House, etc.)

   If you inherit a property and later sell it, capital gains tax will be applicable based on the sale price minus the indexed cost of acquisition.

   • Cost of Acquisition: Inherited assets are considered to be acquired at the cost the original owner (deceased person) paid. If the property was acquired before April 1, 2001, the fair market value (FMV) as of April 1, 2001, can be considered.

   • Indexation: For long-term capital gains, the purchase price is indexed to account for inflation. The Cost Inflation Index (CII), updated annually by the government, is used to compute the indexed acquisition cost, which helps reduce tax liability.

Example: If your parents purchased a property in 1990 for ₹10 lakh, and you sold it in 2024 for ₹1 crore, capital gains will be calculated by indexing the ₹10 lakh using the CII.

     2. Inherited Shares and Securities

          For shares, mutual funds, or other financial securities, capital gains tax is calculated similarly, the holding period for listed securities to qualify as long-term is 12 months.

• Long-Term Capital Gains (LTCG) on equity shares or equity-oriented mutual funds are taxed at 10% if gains exceed ₹1 lakh in a financial year.
• For debt-oriented funds, LTCG beyond 36 months is taxed at 20% with indexation benefits.

How to Calculate Capital Gains Tax on Inherited Assets in 2024

The formula to calculate capital gains for inherited property is:

Capital Gains=Sale Price−Indexed Cost of Acquisition−Expenses on Transfer (if any)

Steps to Calculate Capital Gains:

1. Determine the Cost of Acquisition: If the asset was bought by the deceased after 2001, use the actual purchase price. If bought before April 1, 2001, use the FMV on April 1, 2001.

2. Apply Indexation: Multiply the original purchase price by the ratio of the CII in the year of sale to the CII in the year of acquisition. The Cost Inflation Index for FY 2023-24 is 348.

   Indexed Cost=CII in the year of acquisition CII in the year of sale​×Cost of Acquisition

3. Subtract Indexed Cost from Sale Price: The difference is the capital gain, and if it’s long-term, a 20% tax will apply on this amount.

Example of Capital Gains Tax on Inherited Property:

Let’s say you inherit a property that was bought by your parents in 1995 for ₹10 lakh. You sell this property in 2024 for ₹1.5 crore.

• Fair Market Value on April 1, 2001: Assume ₹30 lakh.
• Indexed Cost of Acquisition: CII in 2024 (348)/CII in 2001 (100)×₹30lakh=₹1.04crore

Capital Gains: ₹1.5 crore (Sale Price) - ₹1.04 crore (Indexed Cost) = ₹46 lakh

The capital gains tax at 20% on ₹46 lakh would be ₹9.2 lakh.

Special Provisions and Exemptions for Capital Gains Tax in India (2024)

India offers certain exemptions to reduce the burden of capital gains tax under Sections 54, 54F, and 54EC of the Income Tax Act:

Section 54: Exemption on Sale of Residential Property

• If you sell an inherited residential property and reinvest the gains in another residential property within a stipulated period (2 years from sale, or 3 years if under construction), you can claim a tax exemption.

Section 54F: Exemption for Non-Residential Property

• For the sale of non-residential assets, if the capital gains are reinvested in a residential property, the entire capital gains or the proportional investment in the new property can be exempted from tax.

Section 54EC: Exemption on Investment in Bonds

• You can invest the gains in specific government bonds (like NHAI or REC bonds) within 6 months of sale and claim an exemption on the capital gains up to ₹50 lakh.

Section 54B: Exemption on capital gains from transfer of land used for agricultural purposes

• The land sold must have been used for agricultural purposes for at least two years. 

• Individual and HUF against Capital Gain Arising from Transfer of Agricultural Land by investment of Capital Gain amount in another land or in Capital Gains Deposit Account Scheme.

Section 54D: Capital gains on the transfer of land and building used for the industrial undertaking

• Capital Gain arising from the transfer, by way of compulsory acquisition under any law, of land or buildings forming part of an industrial undertaking belonging to the assesses are Exempt,

Capital Gains Accounts Scheme (CGAS), 1988

For those taxpayers who are unable to re-invest the capital gains in modes as specified in the Act before the filing of return of income or before the expiry of time to invest the gains. 

To address this, to enable the taxpayer to park his funds till they are invested for the prescribed purpose, the concept of Capital Gains Account Scheme(CGAS) was introduced.

so in Budget 2024, For the FY 2024-25, the budget has been proposed as follows:

• The holding period for classifying the assets will be 12 months and 24 months for short-term and long-term capital assets. Holding  36 months has been removed.

• The holding period for all listed securities is 12 months. All listed securities with a holding period exceeding 12 months are considered Long-Term. The holding period for all other assets is 24 months. Thus, land held for more than 24 months is considered long-term. 

• The tax on long-term capital gains on other financial and non-financial assets is reduced from 20% to 12.5%. While on the other hand, the indexation benefit that previously was available on sale of long-term assets, has now been done away with. So, any sale of land made from 23rd July 2024 will attract a tax rate of 12.5% only without indexation benefit. 

• Short-term capital gain on sale of land shall continue to attract tax at slab rates.

While India has no inheritance tax, the sale of inherited assets brings capital gains tax into the picture, the capital gains tax system is designed to tax profits made from selling inherited assets.
 As the laws evolve, it’s important to stay updated on changes in the Income Tax Act, 1961, and seek professional guidance when dealing with complex tax situations involving inherited property or assets. 
Understanding how these taxes work and taking advantage of exemptions can help you significantly reduce your tax liability.
 By planning well, you can significantly reduce your tax liabilities and make the most of your inherited wealth.

With Taxellence Consultants by your side, you can rest assured that your financial future—and that of your heirs—is in expert hands., Taxellence Consultants India is here to guide you every step of the way

Visit: https://www.taxellence.co.in  or email us  info@taxellence.co.in