SEZ Services

Maximizing Profitability with Expert SEZ Services and Transactional Tax Planning

Establishing a unit in a Special Economic Zone (SEZ) offers significant fiscal incentives, making it a strategic decision for export-oriented business operations and global transactions. However, SEZ status comes with stringent Customs Procedures and regulatory oversight. HVJ & Associates provides specialized SEZ Services, guiding clients through the complex process of approvals, setup, and continuous Transactional Compliance. Our expertise ensures your business maximizes the available Tax Benefits while maintaining flawless adherence to SEZ rules and foreign trade regulations.

The SEZ Advantage: Transactional Tax Benefits

The primary motive for choosing an SEZ unit is to gain a substantial edge in global business transactions through fiscal concessions.

• Income Tax Exemption: Eligible SEZ units benefit from a significant reduction in Income Tax—100% exemption on export profits for the first five years, 50% for the next five years, and 50% of the ploughed-back profit for the subsequent five years. This is a critical transactional advantage.
• Customs Duty Exemption: SEZ units can procure goods (both indigenous and imported) without payment of Customs Duties, excise duties, or GST for authorized operations, substantially lowering the cost of business transactions.
• Other Statutory Exemptions: Exemption from the Central Sales Tax (CST), Service Tax, and various state-level levies on transactions related to authorized business operations.
• Single Window Clearance: Simplifying transactional dealings with government bodies by providing a single point of contact (the Development Commissioner) for all Central and State government clearances.

Business Setup and Transactional Compliance Steps

Our SEZ Services cover the entire lifecycle of an SEZ unit, from pre-establishment advisory to operational Transactional Compliance.

• Approval & Clearance: Assistance in preparing the detailed project report (DPR) and filing the application for the Letter of Approval (LOA) from the Board of Approval (BoA), the most crucial initial business transaction.
• Bonding & Licensing: Completion of all Customs Procedures, including executing the B-17 bond with the Customs authorities and obtaining the necessary operational license for commencing business operations.
• Goods Transactions: Advisory and execution support for all inbound transactions (duty-free imports/procurement) and outbound transactions (exports), ensuring correct documentation and adherence to SEZ rules.
• SEZ-to-DTA Transactions: Guidance on transactions with the Domestic Tariff Area (DTA), including sales and job work, ensuring the correct duties are calculated and paid where applicable.
• De-bonding/Exit: Strategic advisory and execution support for the process of exiting the SEZ scheme, managing the necessary Customs Procedures and tax settlements for the final transactional exit.

Continuous SEZ Compliance Management

Maintaining SEZ status requires rigorous adherence to periodic reporting norms and strict management of inventory and transactions.

• Periodic Reporting: Preparation and filing of mandatory quarterly and annual performance reports (QPR and APR) to the Development Commissioner’s office.
• Accounting & Inventory: Ensuring maintenance of separate, Customs-compliant accounts for all duty-free goods and managing the required inventory records (Annexure I and II).
• Bond Reconciliation: Periodic reconciliation of the Customs bond, ensuring all duty-free materials are accounted for and utilized in authorized business operations.
• Statutory Compliance: Ensuring all other applicable business laws (Corporate, Labour, FEMA) are simultaneously complied with alongside the specific SEZ regulations.

Next Step: Secure Your SEZ Transactional Edge

The SEZ regime offers unparalleled Tax Benefits, but only if managed by experts. Errors in Customs Procedures or Transactional Compliance can lead to the withdrawal of benefits.