TAX KI DUNNIYA

Audit of financial statement means examination of books of accounts and related documents with objective of provide assurance about true and fairness financial statement. Generally people get confused between Statutory Audit and Income Tax Audit .  As the name indicate, Income tax audit is conduct  under income tax act,1961. Whereas Statutory Audit is conducted in accordance with respective registration Act. Company Act 2013 require to statutory audit of every company under the act. Commonly know as Company Audit. The Key difference between  Statutory Audit and Income Tax Audit are as under:   STATUTORY AUDIT INCOME TAX AUDIT Required Under Company Act,2013 or any other previous company act Income Tax Act,1961 Applicable on Company All whose turnover or gross limit exceed prescribe limit Threshold Limit Compulsory required ir-respective of receipt o...

GST is PAN and State specific tax regime. It come with object of  " ONE NATION-ONE  TAX".  But A person is required to registered in each state/UT from where he is liable to do so as per Act. A single registration is granted against a PAN in a state or UT.  This will make trouble for those business organization who has multiple business places in a state/UT. They have only one GSTN for every place or business venture. This became very hurdle to manage proper records and calculate proper GST liability.  In order to simplify this situation , government provide option to apply separate registration for separate business places in a state/UT subject to following condition.   Such person has more than one business place in a state or UT. If separate registration is granted for any of place in state/UT , all business place are ineligible to pay tax under composition scheme. All such places are required to pay tax on taxable supply of goods or services or both m...

 Every newly started business think about when they need to maintain proper books and accounts including records as require under income tax act,1961. Further in today complex market scenario it is difficult to detect any transaction therefore government prescribe businesses including professions to maintain proper books. Following personal require to maintain proper books and accounts that enable assessing officer to determine his total income [Sec 44AA ,Income tax act1961] Personal who carry l egal, medical, engineering, architectural, accountancy, technical advisory, interior decoration, profession of authorized representation, profession of film artist, company secretary, IT profession   are compulsory require to maintain proper accounts.       2.     In case of individual or HUF Existing business or profession where income exceed Rs 250,000 or revenue exceed Rs 25,00,000 in any one of three immediately preceding FY, OR New business...

 There are various sources of income but Income Tax Act,1961  classify all income in 5Head of income unless Act provide any specific exemption therefore. Name of every head describe their nature of classification. Thus, an income which do not fall in any other head of income shall be chargeable" under the head of other sources".[Sec56(1)] There are some specific income which is chargeable "under the head of other sources". [Sec56(2)] Dividend Income other the dividend refer u/s 115-O* Gift including acquisition of property for inadequate consideration  Casual Income Forfeiture of Advance on failed negotiation for capital assets Sub letting of house property Rent from vacant land Agriculture income from land situated outside India Family Pension Director Sitting Fees Income From undisclosed Income Remuneration received by MP/MLA Royalty Income Issue of share of Pvt Company at premium Interest on compensation or enhance compensation Interest on loan, deposits, securit...

 Finance Act 2019 revised Surcharge rate for Individual, HUF, AOP/BOI. The rate is 10%, 15%, 25%, 37% depending on income and their sources. Further Finance Act 2020 provide optional new tax scheme for individual , HUF, AOP, BOI which provide new tax slab. This will also introduce confusion about now what is Maximum Marginal Rate.  WHAT IS MMR Maximum marginal rate is income tax rate including applicable surcharge and cess in relation to highest slab of income for Individual, AOP, BOI specified in Finance Act of relevant year. USE OF MMR Taxation of AOP/BOI Taxation of Business trust being REIT & INVIT Taxation of Investment Fund Taxation on Accreted Income MMR rate for FY 2019-20 & 2020-21 Highest tax slab for Both FY    :  30% Highest applicable Surcharge    :  37% Health & Education Cess          :   4% So MMR will be                      ...

 Every person who is required to file income tax return  u/s 139(1) of income tax act  shall file his return on or before due date. However, if person fails to file return within specified period than also he can file before end of relevant Assessment year. In such case assessee has to relinquish certain benefits and pay penalty or interest. Due date for FY: 2019-20 :  https://taxkidunniya.blogspot.com/2020/11/extend-due-date-of-income-tax-return.html Here are some major disadvantages of non filling return within prescribe time.