As per newly inserted “clause (h)” under section 43B of the Income Tax Act 1961, every business is required to pay its micro and small enterprises vendors/suppliers within 15 days of receipt of goods or services and in case of written agreement between buyer and supplier, payment can be made within 45 days. Further if payment is not made within 15/45 days, than that amount will be added in the income of the buyer and income tax is required to be paid on that amount. However deduction will be allowed to buyer in the year in which payment is made to micro and small enterprises.
In view of the above, now onwards, it is essential for the buyer to know about whether his vendors/suppliers are registered under MSME act or not. Below is the request letter format for getting declaration of registration under Micro, Small and Medium Enterprises Development Act 2006 (MSME Act) from vendors/suppliers.
Note: You can download the format of Request Letter for Declaration of Registration under Micro, Small and Medium Enterprises Development Act 2006 (MSME Act) from Vendor/Suppliers in word file, from the link provided at the end of this post.
Request Letter for Declaration of Registration under Micro, Small and Medium Enterprises Development Act 2006 (MSME Act) from Vendor/Suppliers
Subject: Declaration of Registration under Micro, Small and Medium Enterprises Development Act 2006 (MSME Act).
We, [Name of Your Firm/Company], would like to ensure compliance with the rules as laid down under Micro, Small and Medium Enterprises Development Act 2006 (MSME Act), and as a part of our periodic due diligence, we require all our vendors/suppliers to declare status of their registration under MSME Act.
In this regard, we request you to kindly provide us a declaration regarding whether your business is registered under MSME Act or not. If your business is registered, please provide the below details along with copy of Udyam Registration Certificate:-
|Name of the Business Entity
|Nature of Business Entity(Proprietorship/Firm/HUF/Company)
|Udyam Registration Number
If your business is not registered under MSME Act, kindly provide us the declaration that your business is not registered under MSME Act.
As above information is crucial for our records and compliance, your prompt response in this regard will be highly appreciated. Please note that if we do not receive a response from you within [XX] days from the date of this letter, it will be assumed that your company is not registered under the MSME Act.
[Name of Authorised Signatory]
[Name of Firm/Company]