ICAI UDIN : Negative List

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ICAI-UDIN : Negative List

1. Auditor’s Opinion/Reports issued by the Practicing Chartered Accountant under any Statute w.r.t. any entity or any person (e.g.: Tax Audit, Transfer Price Audit, VAT Audit, GST Audit, Company Audit, Trust Audit, Society Audit, etc.,

2. Valuation Reports,

3. Quarterly Review Reports,

4. Limited Review Report,

5. Information System Audit,

6. Forensic Audit,

7. Revenue / Credit / Stock Audit,

8. Borrower Monitoring Assignments,

9. Concurrent / Internal Audit and like,

10. Any report of what so ever nature issued including Transfer Price Study Report, Viability Study Report, Diligence Report, Due Diligence Report, Management Report, etc.

JUDGEMENT ON PENNY STOCK IN THE FAVOUR OF ASSESSEE

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INCOME TAX CASES:- JUDGEMENT ON PENNY STOCK IN THE FAVOUR OF ASSESSEE

1. *Amar Nath Goenka and ors v. ACIT (ITA No. 5882/D/18) (ITAT, Delhi) (12/12/2018)
SECTION 10(38) AND SECTION 68 – LONG TERM CAPITAL – PENNY STOCK ASSESSEE DISCHARGING THE ONUS BY PLACING ON RECORD VARIOUS DOCUMENTARY EVIDENCES – AO DID NOT MAKE ANY INDEPENDENT ENQUIRY – STATEMENT OF THIRD PARTY WHICH WAS NOT SUBJECTED TO CROSS EXAMINATION IS INADMISSIBLE EVIDENCE – ADDITION DELETED

2. Mukta Gupta v. ITO (ITA No. 2766/D/18, 2767/D/18) (ITAT, Delhi) (Dated 26/11/2018)
SECTION 10(38) & 68 – PENNY STOCK – ADDITION ON ACCOUNT OF PROFIT ARISING FROM SALE OF SHARES, ALLEGED AS PENNY STOCK CANNOT BE MADE UNDER SECTION 68 – SUFFICIENT EVIDENCES WERE ON RECORD TO PROVE VERACITY OF THE TRANSACTION – SEBI REPORT BY ITSELF WAS NOT SUFFICIENT TO DENY THE TRANSACTION ENTERED BY THE ASSESSE.

3. Veena Gupta v. ACIT (ITA No. 5662/D/2018) (ITAT, Delhi) (27/11/2018)
SECTION 10(38) AND SECTION 68 – LONG TERM CAPITAL – PENNY STOCK ADDITION BASED ON STATEMENT OF THIRD PARTIES- NO OPPORTUNITY OF CROSS EXAMINATION – ADDITION LIABLE TO DELETED

4. Ajay Goel and ors v. ITO (ITA No. 4481 – 84/D/18) (ITAT, Delhi) (03/12/2018)
SECTION 10(38) & 68 – LONG TERM CAPITAL GAIN ON SALE OF PENNY STOCKS – ADDITION ON THE BASIS OF INFORMATION FROM INVESTIGATION WING WITHOUT AFFORDING OPPORTUN ITY OF CROSS EXAMINATION – ADDITION NOT SUSTAINABLE*

List of goods which attracts GST 28% rate with HSN codes:

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List of goods which attracts GST 28% rate with HSN codes:

Many goods and services has changed since the time it was introduced. For example when GST was introduced, near 229 were having GST rate of 28%. Whereas now only 31 items net are having GST rate of 28%. Below is the list of 31 items having GST Rate of 28%.

This list updated upto 1st January 2018 and incorporates all the changes notified by government on the basis of suggestion given by GST council in the 31st meeting.

  1. No. Description of Goods Chapter / Heading / Sub-heading / Tariff item
  2. Molasses 1703
  3. Pan Masala 2106 90 20
  4. All goods [including aerated waters], containing added sugar or other sweetening matter or flavoured 2202 10
  5. Unmanufactured tobacco; tobacco refuse [other than tobacco leaves] 2401
  6. Cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes 2402
  7. Other manufactured tobacco and manufactured tobacco substitutes; “homogenised” or “reconstituted” tobacco; tobacco extracts and essences [including biris] 2403
  8. Portland cement, aluminous cement, slag cement, super sulphate cement and similar hydraulic cements, whether or not coloured or in the form of clinkers 2523
  9. New pneumatic tyres, of rubber [other than of a kind used on/in bicycles, cycle-rickshaws and three wheeled powered cycle rickshaws; and Rear Tractor tyres; and of a kind used on aircraft] 4011
  10. Spark-ignition reciprocating or rotary internal combustion piston engine [other than aircraft engines] 8407
  11. Compression-ignition internal combustion piston engines (diesel or semi-diesel engines) 8408
  12. Parts suitable for use solely or principally with the engines of heading 8407 or 8408 8409
  13. Pumps for dispensing fuel or lubricants of the type used in filling stations or garages [8413 11], Fuel, lubricating or cooling medium pumps for internal combustion piston engines [8413 30] 8413
  14. Air-conditioning machines, comprising a motor-driven fan and elements for changing the temperature and humidity, including those machines in which the humidity cannot be separately regulated 8415
  15. Dish washing machines, household [8422 11 00] and other [8422 19 00] 8422
  16. Electrical  ignition  or  starting  equipment  of a kind  used  for  spark-ignition  or  compression- ignition internal combustion engines (for example, ignition magnetos, magneto- dynamos, ignition coils, sparking plugs and glow plugs, starter motors); generators (for example, dynamos, alternators) and cut-outs of a kind used in conjunction with such engines 8511
  17. Road tractors for semi-trailers of engine capacity more than 1800 cc 8701
  18. Motor vehicles for the transport of ten or more persons, including the driver [other than buses for use in public transport, which exclusively run on Bio-fuels] 8702
  19. Motor cars and other motor vehicles principally designed for the transport of persons (other than those of heading 8702), including station wagons and racing cars [other than Cars for physically handicapped persons] 8703
  20. Motor vehicles for the transport of goods [other than Refrigerated motor vehicles] 8704
  21. Chassis fitted with engines, for the motor vehicles of headings 8701 to 8705 8706
  22. Bodies (including cabs), for the motor vehicles of headings 8701 to 8705 8707
  23. Parts and accessories of the motor vehicles of headings 8701 to 8705 [other than specified parts of tractors] 8708
  24. Motorcycles (including mopeds) and cycles fitted with an auxiliary motor, with or without side-cars; side-cars 8711
  25. Parts and accessories of vehicles of headings 8711 8714
  26. Aircrafts for personal use 8802
  27. Yachts and other vessels for pleasure or sports; rowing boats and canoes 8903
  28. Revolvers and pistols, other than those of heading 9303 or 9304 9302
  29. Smoking pipes (including pipe bowls) and cigar or cigarette holders, and parts thereof 9614
  30. All dutiable articles intended for personal use 9804
  31. Lottery authorized by State Governments

Explanation 1.- For the purposes of this entry, value of supply of lottery under sub-section (5) of section 15 of the Central Goods and Services Tax Act, 2017 shall be deemed to be 100/128 of the face value of ticket or of the price as notified in the Official Gazette by the organising State, whichever is higher.

Explanation 2.- (1) “Lottery authorized by State Governments” means a lottery which is authorized to be sold in State(s) other than the organising state also. (2) Organising state has the same meaning as assigned to it in clause (f) of sub-rule (1) of rule 2 of the Lotteries (Regulation) Rules, 2010 Any chapter 31 Actionable claim in the form of chance to win in betting, gambling, or horse racing in race club Any Chapter

4 golden rules of fundamental analysis

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4 golden rules of fundamental analysis:

  • Golden Rule 1: Growth in earnings, learn how to study companies earning growth yearly growth and quarterly growth.
  • Golden Rule 2: Management Efficiency and Efficient Business, learn how to analyze the management efficiency.
  • Golden Rule 3: Performing Sectors, Companies MOAT & Competitive Advantage, learn how to identify top performing sector and competitor analysis of the company.
  • Golden Rule 4: Favorable Valuation, learn how to value the target price of the stock and check whether it is under price or overpriced.
  • At last SWOT Analysis.

Trademark Classes List

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Trademark registration that works to protects your business reputation and goodwill around the world. With the trademark; one can easily make his or her business familiar to the target market. Trademark can be representing as graphic, text, words or combination of these elements. It can be use over the letter pad of the company, banners of services and products, marketing pamphlets, visiting cards and many more. All these worthy materials and the exact use of trademark would bring the business on the mark efficiently. Well, during the process of trademark registration there is one of the fields where you need to specify about the trademark classes like the category of products and services in respect of which the proposed trademark is being used.

Trademark Classes of Goods and Services

If we concern varied goods and services there are total of 45 classes out of which 34 classes are for products and 11 are stated for services category. The main aim of classification of trademark goods and services is to prepare a complete hierarchy which trademark is being used under which category. While following this strategy; it will be easy for the govern bodies to handle the trademark classes list at domestic and international level.

Trademark Classes List of Goods and Services:

Class 1: is for Chemicals, Resins, and Plastics.)
Class 2: is for Varnishes, Paints, and Anti-corrosion substances
Class 3: is for Cosmetics, Hair Oils and Lotions, and Cleaning Preparations
Class 4: is for Greases, Lubricants, and Fuels
Class 5: is for Pharmaceutical, Medical, and Sanitary Preparations
Class 6: is for Goods of Metals and Alloys, Ironmongery and Hardware Products
Class 7: is for Equipment and Machinery
Class 8: is for Hand-operated Devices and Tools
Class 9: is for Scientific, Electrical, and Technological Apparatus
Class 10: is for Medical and Surgical Instruments and Apparatus
Class 11: is for Heating, Cooling, Drying, and Refrigerating Apparatus
Class 12: is for Land, Air, and Water Vehicles
Class 13: is for Explosives and Firearms
Class 14: is for Precious Metals and Stones, and Jewelry Items
Class 15: is for Diverse Musical Instruments
Class 16: is for Paper Goods, Stationery Products, and Printed Materials
Class 17: is for Rubber and Plastic Goods and Products
Class 18: is for Products made of Hides and Leathers
Class 19: is for Various Non-Metallic Building Materials)
Class 20: is for Furniture, and other precious household Articles
Class 21: is for Kitchen Utensils, Household Appliances and Glass products
Class 22: is for Ropes and Cordage, Fibers, and Stuffing materials
Class 23: is for Threads and Yarns for uses in textiles
Class 24: is for Textiles and Fabrics
Class 25: is for Apparels and Clothing
Class 26: is for Fringes and Fancy Goods and Products
Class 27: is for Floor Coverings and Wall Hangings
Class 28: is for Toys, Sporting, and Sports Goods
Class 29: is for Meats and Processed Food Items
Class 30: is for Auxiliary Food and Beverage Items
Class 31: is for Agricultural and Horticultural Products
Class 32: is for Beers, Light Beverages, and Fruit Juices
Class 33: is for Wines and Spirits
Class 34: is for Tobacco Products and Smokers’ Articles

Services

Class 35: is for Advertising and Business Services
Class 36: is for Insurance and Financial Services
Class 37: is for Building, Construction and Repair Services
Class 38: is for Telecommunication Services
Class 39: is for Transportation and Storage Services
Class 40: is for Treatment of Materials Services
Class 41: is for Education and Entertainment Services
Class 42: is for Computer, Scientific and Legal Services
Class 43: is for Hotels and Restaurants Services
Class 44: is for Medical, Beauty, and Agricultural Services
Class 45: is for Personal and Social Services Services

GST – Composition Return Questionaire.

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(i). Do you want to file Nil return?
Note:Nil return can be filed by you if you have not made any outward supply (commonly known as sale) AND have NOT received (commonly known as purchase) any goods/services AND do not have any liability.

(ii). Have you made inward supplies (other than reverse charge supplies) during the period (Table 4A):
(iii). Have you made inward supplies (attracting reverse charge) during the period (Table 4B):
(iv). Have you received any supplies from un-registered suppliers) during the period (Table 4C):
(v). Have you imported any service (Table 4D):
(vi). Do you intend to amend inward supplies reported in Table 4A (other than reverse charge) (Table 5):
(vii). Do you intend to amend inward supplies reported in Table 4B (reverse charge) (Table 5):
(viii). Do you intend to amend inward supplies reported in Table 4C (supplies received from un-regd. persons): (Table 5)
(ix). Do you intend to amend import of services reported in Table 4D (Table 5):
(x).Have you received any debit/credit note (Table 5B):
(xi). Do you intend to amend debit/credit note reported in Table 5B (Table 5C):
(xii). Have you made any outward supply during the Qtr (Table 6):
(xiii). Do you intend to amend outward supplies reported in Table 6 in earlier quarters (Table 7):
(xiv). Have you paid any advance amount for reverse charge inward supplies or made adjustment there to [Table 8A(1) / 8A(2)/8B(1)/8B(2)]:
(xv). Do you intend to amend advance amount received for reverse charge supplies [Table 8A(1) / 8A(2)/8B(1)/8B(2)]:
(xvi). Do you intend to claim refund from cash ledger (Table 12):
(xvii). Previous period(s) / return(s) liability, if any: Previous period (s) / return (s) liability would be system determined.

All About IEC- Import Export Code.

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Applicants are required to follow steps given below:
Step 1 – Add/Update Entity Details
Step 2 – Add/Update Firm’s Branch Details
Step 3 – Add/Update all director/partner Details as follows —
> For Proprietorship — Proprietor’s details
> For Partnership & LLP — Details of all Partners
> For Limited Company — Details of all directors
> For Trust — Details of Trustee
>For Society — Details of Secretary
Step 4 – Upload address proof of the firm and bank certificate(or pre-printed cancelled cheque)
– For modification upload following additional documents:
> Signed Copy of Application
>scanned copy of Part-C of ANF-2A
Step 5 – Pay & Verify Fees
Step 6 – Preview and Print Application
Step 7 – Submit application. Generate and Print IEC

Deferred tax

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Deferred tax refers to the tax effect of temporary differences between accounting income that is calculated by taking into consideration the provisions of Companies Act, 2013 and taxable income that is calculated by taking into consideration the provisions of Income Tax Act,1961.

Temporary Differences:

While calculating taxable income, certain expenses debited to Profit or Loss A/c are disallowed in one period and gets reversed in future period in accordance with provisions of the Income-tax Act. In the same manner, certain incomes credited in one period to Profit or Loss A/c form part of the income in future period. Such items are considered as temporary differences.

 

For example:

(i) In case of treatment of deferred revenue expenditure (say, advertisement expenses incurred in one year but the benefit of which extends in subsequent years also), the expenditure incurred is amortised over a period of time but as per tax laws, it is allowed wholly in first year in which such deferred revenue expenditure is made.

(ii) In case of advance incomes received (say, advance rent), the disclosure of same is mandatory for the purpose of calculating taxable income. However, this income is recognized in the books of account when actually earned.

(iii)       In case of different book and tax depreciation which could arise due to difference in depreciation rates or methods of calculating depreciation i.e. SLM or WDV or differences in composition of actual cost of assets.

(iv) In case of provisions made in anticipation of liabilities where the liability is allowed in the subsequent period when it crystalizes.

Deferred Tax Accounting:

The accounting, presentation and disclosure of deferred tax is carried out as per the provisions of “Accounting Standard- 22” (i.e., Accounting for Taxes on Income) or “Ind AS- 12” (i.e., Income Taxes). Deferred tax asset or deferred tax liability is created by debiting/crediting Statement of Profit and Loss.

The following table shows different cases where deferred tax asset/ liability is required to be created:

CASES DEFERRED TAX ASSET/ LIABILITY
Book Profit > Taxable Profit Deferred Tax Liability (DTL)
Book Profit < Taxable Profit Deferred Tax Asset (DTA)

Deferred Tax Asset/ liability in case of LOSS:

Due to differences in income as per financial books and taxable profit as per tax laws, there is a certainty that one book reflects loss and other shows profit. In that case, the following treatment shall be made:

 

CASES DEFERRED TAX ASSET/ LIABILITY
Loss as per books of accounts and Profit as per tax laws (Subject to the principles of prudence) Deferred Tax Asset (DTA)
Loss as per tax laws and Profit as per books of account (MAT has to be paid) Deferred Tax Liability (DTL)

Deferred Tax Computation Rate:

The deferred tax asset/liability is calculated at the normal rate of tax.

Deferred Tax Asset Accounting:

Deferred Tax Asset (DTA) account is created by crediting Profit & Loss Account. The following journal entry is required to be passed.

Deferred Tax Asset A/C……………. Dr

To Profit & Loss A/C……………………..….

Deferred Tax Liability Accounting:

Deferred Tax Liability (DTL) account is created by crediting Profit & Loss Account. The following journal entry is required to be passed.

Profit & Loss A/C ……………. Dr

To Deferred Tax Liability A/C ………..…….

 

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Short Analysis of AS-22 w. r. t. Depreciation-

Deferred Tax is the tax effects of Timing Difference. The whole concept of deferred tax is depending on timing difference.

Accounting income (loss) is the net profit or loss for a period, as reported in the statement of profit and loss, before deducting income tax expense or adding income tax saving.

Taxable income (tax loss) is the amount of the income (loss) for a period, determined in accordance with the tax laws, based upon which income tax payable (recoverable) is determined.

As per AS-22 Timing differences are the differences between taxable income and accounting income for a period that originate in one period and are capable of reversal in one or more subsequent periods.

Example: – An asset is purchased of Rs.1,00,000/- having a useful life of 5 years and allowed 100% depreciation under Income Tax Act. Profit before depreciation is Rs.2,00,000/-.

Rs. 20,000/- (i.e. 100,000/5) is allowed as depreciation while computing the accounting income and Rs.1,00,000/- is allowed as full depreciation in the year of purchase while computing the taxable income.

Hence, Accounting Income is Rs.1,80,000/- (i.e. 2,00,000-20,000)

Taxable Income is Rs.1,00,000/- (i.e. 2,00,000-1,00,000)

Hence, the difference between Accounting Income and Taxable Income is created in this year and shall be created in a subsequent year (by the balance depreciation of Rs. 80,000=1,00,000-20,000) because in subsequent years, while computing the accounting income the entity shall deduct the depreciation of Rs. 20,000 but nil depreciation shall be allowed while computing the taxable income. This is called timing difference.

श्री कृष्ण” के 64 गुण

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भक्तिरसामृतसिन्धु में भगवान् “श्री कृष्ण” के 64 गुण
बताए गए हैं जो इस प्रकार हैं –
(1) सम्पूर्ण शरीर का सुन्दर स्वरूप
(2 )समस्त शुभ गुणों से अंकित
(3) अतिव रूचिर
(4)तेजवान
(5) बलवान
(6) नित्य युवा
(6) अद्भुत भाषाविद्
(8) सत्यवादी
(9) मधुर भाषी
(10) वाक् पटु
(11) सुपण्डित
(12)अत्यधिक बुद्धिमान्
(13) प्रतिभावान्
(14 ) विदग्ध
(15) अतिव चतुर
(16) दक्ष
(17) कृतज्ञ
(18) दृढ़संकल्प
(19) काल तथा परिस्थियों के कुशल निर्णायक
(20) वेदों या शास्त्रों के आधार पर देखने एवं बोलने वाले
(21) पवित्र
(22) आत्मसंयमी
(23) स्थिर
(24) सहिष्णु
(25) क्षमावान्
(26) गंभीर
(27) धैर्यवान्
(28) समदृष्टि रखने वाले
(29) उदार
(30) धार्मिक
(31) शूरवीर
(32) दयालु
(33) सम्मान करने वाले
(34) भद्र
(35) विनयी
(36) लज्जावान्
(37) शरणागत पालक
(38) सुखी
(39) भक्तों के हितैषी
(40) प्रेमवश्य
(41) सर्वमंगलमय
(42) परम शक्तिमान्
(43) परमयशस्वी
(44) लोकप्रिय
(45) भक्तों का पक्ष लेने वाले
(46) समस्त स्त्रियों के लिए अत्यधिक आकर्षक
(47) सर्व आराध्य
(48) सर्व सम्पन्न
(49) सर्व सम्मान्य
(50 ) परम नियंता
(51) परिवर्तन रहित
(52) सर्वज्ञ
(53) चिर नूतन
(54) सच्चिदानंद(सदैव नित्य आनन्दमय शरीरवाले)
(55)समस्त योग सिद्धियों से युक्त ।
“श्री कृष्ण” में पांच गुण और भी होते हैं जो नारायण के शरीर में प्रकट होते हैं और ये हैं….
(56) वे अचिंत्य शक्तिमय हैं..
(57) उनके शरीर से असंख्य ब्रह्माण्ड उत्पन्न होते हैं..
(58) समस्त अवतारों के उद्गम वे ही हैं..
(59) वे अपने द्वारा मारे हुए शत्रुओं को भी मुक्ति देने वाले हैं..
(60) वे मुक्तात्माओं के लिए आकर्षक हैं ।
ये सारे गुण भगवान् “श्री कृष्ण” के साकार स्वरूप में अद्भूत ढंग से प्रकट होते हैं । इन साठ दिव्य गुणों के अतिरिक्त “श्री कृष्ण”में चार और भी गुण पाए जाते हैं जो देवताओं या जीवों में तो क्या ,स्वयं नारायण रूप में भी नहीं होते । यह गुण हैं…..
(61) वे अद्भुत लीलाओं के कर्ता हैं ( विषेकर उनकी बाल लीलाएं)
(62) वे अद्भुत भगवत् से युक्त भक्तों द्वारा घिरे रहते हैं
(63) वे अपनी वंशी से सारे जीवों को आकृष्ट कर सकते हैं
(64) उनका रूप सौंन्दर्य अद्भुत है जो सारी सृष्टि में अद्वितीय है।
इन 64 असाधारण गुणों से युक्त श्री कृष्ण 64 कला से भी परिपूर्ण हैं।

BHAGWAD GITA IN ONE LINE PER CHAPTER

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BHAGWAD GITA IN ONE LINE PER CHAPTER

Chapter 1 :
Wrong thinking is the only problem in life

Chapter 2 :
Right knowledge is the ultimate solution to all our problems

Chapter 3 :
Selflessness is the only way to progress and prosperity

Chapter 4 :
Every act can be an act of prayer

Chapter 5 :
Renounce the ego of individuality and Rejoice in the Bliss of Infinity

Chapter 6 :
Connect to the Higher ConsciousNess Daily

Chapter 7 :
Live what you learn

Chapter 8 :
Never give up on yourself

Chapter 9 :
Value your blessings

Chapter 10 :
See divinity all around

Chapter 11 :
Have enough surrender to see the Truth as it is

Chapter 12 :
Absorb your mind in the Higher

Chapter 13 :
Detach from Maya and Attach to Divine

Chapter 14 :
Live a lifestyle that matches your vision

Chapter 15 :
Give priority to Divinity

Chapter 16 :
Being good is a reward in itself

Chapter 17 :
Choosing the right over the pleasant is a sign of power

Chapter 18 :
Let Go, Lets move to Union with God !!!

Important Points of Income Tax for A.Y. 2017-18

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Last date of Income Tax Return filing is approaching. All taxpayers have a lot of doubts and queries related to income tax. Though each query is different and unique but there are some common points which are useful for all taxpayers. Over last 10 years, the return filing process has simplified. Once it was unthinkable to file the return on your own. I used to pay Rs 4,000 for return filing in Mumbai. TRP was 1st major reform and max fees of a TRP was capped. Online tax filing turned the table upside down and completely simplified the entire process. In case, you have income only from salary, you don’t require any professional help to file the return.

I still believe that there is a long way to go. The entire taxation process should be simplified. One of the solutions is to do away with deductions and allowances. Tax at lower rate 5% should be charged on Gross income. Another solution is to tax cash transactions which will bring more people in the tax net. The biggest problem in India is the mindset of people to evade tax. If everyone will start paying the tax honestly then Income Tax rates will automatically reduce to lower levels. It will bring more people under tax net as lower rates will not pinch the pocket of taxpayers. Anyways its a topic of long discussion. Through this post, i am sharing 51 important points related to income tax.

1. The official website of Income Tax department is www.incometaxindia.gov.in

2. As per Income Tax Act, Income is taxable under five heads- Salary, House Property, Business or Profession, Capital Gain and income from other Sources. It sounds so simple but in reality it is very complex to calculate.

3. For a Salaried Employee, Form 16 from his Employer is a must.

4. A Salaried Employee can file Income Tax Return by using Form 16 and adding other Income. Here i am assuming that there is no other source of income

5. From FY 2015-16, Transport Allowance is exempted up to Rs.1,600 per month.

6. A Standard deduction of 30% is available on Income from House Property.

7. Second House Property is always considered as deemed let out. You have to consider the Income from House Property even if it is vacant. In case of Home Loan, you can claim Loss from the Let Out Property.

8. For self-occupied house property, maximum deduction of Interest on Home Loan is Rs. 2 Lac. For let out property, actual Home Loan Interest is allowed as a deduction.

9. Repayment of Home Loan Principal amount u/s 80C is up to Rs. 1.5 Lac. You may check my post, Home Loan Tax Benefit Deductions for more details.

10. In case of a Business, Tax Audit is compulsory if sales turnover exceeds Rs.1 Cr.

11. In case of self employed professionals, Tax Audit is compulsory if the Gross Receipts exceeds Rs.25 lac.

12. Maximum Cash payment to any individual in a single day should not exceed Rs.20,000.

13. For Loans, deposits and Properties transactions, maximum cash limit is Rs.20,000 for the transaction. In property transaction, this limit is for paying token money.

14. Any loss from Business can be carried forward for next 8 financial years.

15. TDS is due at the time of making Payment.

16. TDS payment should be made on or before the 7th day of next month in which it is deducted.

17. Late filing of TDS return attracts late filing fees of Rs.200 per day u/s 234(E).

18. Long Term Capital Gain will arise if the holding period of an Asset is more than 3 years. In case of Equity, if the holding period is more than 1 year then there is no tax on the capital gains.

19. In most of the cases, Long Term Capital Gains is taxable @ 20%

20. STT paid Long Term Capital Gain on equity etc is exempted from the Income Tax.

21. If the STT is paid then Short Term Capital Gain is taxed @ 15%.

22. Capital Gain on Immovable Properties is chargeable at Guidance Value/Ready Reckoner Value or Transaction value, whichever is higher.

23. Dividend distributed by the domestic companies is exempted from Tax.

24. Agricultural Income is 100% exempted from Tax.

25. Gifts received from the non-blood relatives which exceed Rs.50,000 is taxable in the hands of recipient.

26. Gifts received at the time of Marriage, inherited through Will or Succession and from blood relatives are tax free.
27. Maximum deduction allowed u/s 80C, 80CCC and 80 CCD is Rs.1,50,000.

28. Tax deduction on Health Insurance Premium is available up to Rs. 25,000.

29. Tax deduction on Health Insurance Premium is available up to Rs. 20,000 for parents.

30. Deduction limit of Interest earned on Savings Account is up to Rs.10, 000.

31. Income earned by a Minor child is clubbed with the income of Parents.

32. It is critical that every Taxpayer should verify his Form 26AS.

33. Form 26AS provides the Information regarding the TDS deducted, Advance Tax paid and Refund details.

34. If there is discrepancy between Income mentioned in the Form 26AS and the Income Tax Return filed then the taxpayer may receive notice from the IT department.

35. For FY 2015-16, Basic Exemption Limit for individuals is Rs.2.5 Lac.

36. For FY 2015-16, Basic Exemption Limit for Senior Citizen i.e. above 60 years age is Rs. 3 Lac.

37. For FY 2015-16, Basic Exemption Limit for Super Senior Citizen i.e. above 80 years age is Rs. 5 lac.

38. Advance Tax should be paid if the Tax Liability during the financial year exceeds Rs. 10,000.

39. A Surcharge of 12% is applicable if the Income Exceeds Rs. 1 Crore.

40. It is mandatory to file Income Tax Return if the Income exceeds Basic Exemption Limit.

41. It is mandatory to provide details of all the Bank Accounts in Income Tax return.

42. It is mandatory to provide Passport number in the Income Tax return.

43. It is mandatory to provide detail of Fixed Assets held abroad in the Income Tax return.

44. If the taxable income of Individual is less than Rs. 5 Lacs then rebate of Rs.2,000/- is available on Tax.

45. Aadhar No. should be mentioned in the Income Tax return.

46. If the income exceeds Rs. 5 lacs then e-filing is mandatory.

47. You can e-file income tax return only for Previous 2 Years.

48. PAN Card is essential for Taxpayers and it should not be mentioned in return.

49. If you have Aadhaar then you need not send ITR V acknowledgment through Ordinary Post or Speed Post to IT department. You can opt for Aadhaar based authentication to file Income Tax Return.

50. TDS u/s 194IA is deducted from Seller’s contribution. A buyer cannot claim a refund of TDS deducted.

51. Tax Benefit of Rs 5,000/- is available u/s 80D for preventive health check up.

Check C-KYC or Central KYC status online?

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Central KYC or CKYC was replaced the old KYC process. It’s centralized process avoids you to submit multiple KYC while opening savings bank accounts, buying life insurance or investing in mutual fund products into one time centralized process. How to check CKYC or Central KYC Status online?

As I pointed above, now this new Central KYC or CKYC replaced the old KYC process. This reduced the multiple submission of KYC at different stages of financial transactions.

What is CKYC or Central KYC?

It is a single and centralized KYC process for all your financial transactions. In the old format of KYC, PAN was the sole identifier for an investor. However, in new Central KYC Registry system, the list goes beyond Aadhaar and PAN. It removes the submission of KYC at different level or to different financial institutions of your financial transactions.

It is also the single form to create new KYC or modify the existing KYC. Three types of accounts are specified. One is Normal, second is Simplified or for low-risk customers and third is Small investors. You have to select which is applicable to you.

If your aggregate of all credits in a financial year does not exceed rupees one lakh, the aggregate of all withdrawals and transfers in a month does not exceed rupees ten thousand or the balance at any point of time does not exceed rupees fifty thousand, then you will be considered as SMALL account type of investor.

The simplified or low-risk customers means customers who are not able to submit anyone among 6 documents listed. They are Passport, driving license, PAN card, Voter ID, job card issued by NREGA or Aadhaar Card.

This CKYC or Central KYC also includes the FATCA declaration. Hence, it avoids you declare the same at the different level of your investments.

The format of CKYC or Central KYC will be as below.

How to fill the CKYC or Central KYC form?

I have created a short video on how to fill this form. This is simple and easy to understand. Watch this video before filling the CKYC or Central KYC form.

How to check CKYC or Central KYC status online?

As of now, there was no link to check CKYC or Central KYC status online. Hence, many found it hard to check the status online. However, recently Karvy started the facility to check CKYC or Central KYC status online.

This I think a big relief to many. I know that even though you submitted the CKYC or Central KYC application, in some cases the status may not show this. I think they are still at data compilation mode. But still, I feel it’s the big relief to many.

Visit the Karvy website link to check CKYC or Central KYC status online.

The screen looks like below.

You notice that you will also get your CKYC ID, which is very much important to quote for future references like modify or update your KYC data.

As I pointed, as of now Karvy started this facility. I will update this post whenever others also follow the same.

Do note that if your KYC was registered in the old system of KYC, then the status will not reflect CKYC ID, instead, it shows the old KYC data.

Fill New Income Tax Return (ITR) Form – 1

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The time of the year come again when we all start daydreaming about what we’re going to do with our tax refund, if only we manage to file the returns before the deadline- 31st July 2018.  But procrastination often gets the better of us.

So, if you’re dragging your feet on filing your income tax returns this year, it’s the right time to get moving! The Government last year introduced a maximum penalty of Rs. 10,000 for late filing which is applicable with effect from 1st April 2018.

A new income-tax returns (ITR) form was also introduced for individual taxpayers whose income does not exceed Rs. 50 lakh in a year. Here’s everything you need to know about filling the new Income Tax Return (ITR) Form- 1 online.         

What is ITR Form-1 (Sahaj)?

ITR Form -1 (Sahaj) is a one-page form that was introduced by the Central Board of Direct Taxes (CBDT) for the A.Y. 2018-19. The form was released for taxpayers with an income of up to Rs. 50 lakh, with salary being the primary source of income, besides income from one house property and other income like interest from bank deposits etc.

Unlike last year, where only details of income from salary or pension along with income from one house property and other income were to be filled, the new form requires you to provide a break-up of your income from each source.

Income From Salary

This head is further divided into five columns – in the first column, enter the amount of basic salary received, excluding all allowances, perquisites, and profit in lieu of salary. This part of your in-hand salary is fully taxable.

In the second column, you need to mention the allowances that are not exempt from tax. For example, transport allowance for FY 2017-18 is exempt from tax for up to Rs. 1,600 per month or Rs. 19,200 annually. So, any amount received over and above will be chargeable to tax. Now, in the third column, enter the details of perquisites received including rent accommodation, employees’ stock options (ESOPs) etc.

The fourth column requires you to fill in the amount related to profit in lieu of salary. This is nothing but the payments received by an employee in lieu of or in addition to salary or wages. For example, any amount of compensation you received from your former employer after the termination of employment etc. Once this is done, enter the deductions under section 16 of the Act like professional tax and entertainment allowance etc. in the last column.

Income From House Property

Unlike last year, if you own a house, you were only required to mention the amount of income earned from the house property without providing any additional details. However, from this year onward, you need to mention a few other details such whether it is a self-occupied or a let-out property, gross rent received, interest payments on your Home Loan etc.

In case you let out a property

If your property was let-out during the previous year, you need to provide a break-up of your gross rent received in the first column. In the subsequent columns, mention the property tax paid to local authorities and the annual value of the property. The annual value is your gross rent minus taxes paid.

You can further claim a standard deduction of 30% of annual value and interest paid on your Home Loan. Mention the same in the fourth and fifth columns respectively. In the last column, “Income chargeable under the head ‘House Property”, just enter the annual value after reducing the amount of standard deduction and interest on Home Loan from it.

Income from other sources

Under this head, you need to mention the interest earned from all your bank deposits. Under section 80TTA, an income of up to Rs. 10,000 from bank accounts is exempt from tax under. So, it’s important to declare interest earned and claim the exemption.

That’s it! Remember, the form is to be filled online, however, you can file the ITR Form-1 offline if you are above the age of 80 years or earn less than Rs. 5 lakh and don’t have a refund claim.

Transferring Your Home Loan

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Home Loans are a long-term financial commitment with tenures typically ranging between 10 to 30 years. During this time there is a possibility that you may not be happy with your bank or lending institution, or that your existing interest rate may be too high compared to market rates.

There certainly will arise a thought under such circumstances to transfer your home loan  from your current lender to another. However, as a borrower, you need to look at other aspects as well before moving your loan.

Document Vetting for Refinancing – Even though it’s a transfer of a loan, it is still a new loan for the lender, for which they would require all documents that you originally gave your current lender for vetting process. Your financial statements may have also changed since you availed the loan, so that will also have to be made available through pay slips, Form 16, income tax returns and more.

Processing Fees – Since this will be like refinancing your loan, there is bound to be a processing chargeinvolved. Most banks and NBFCs charge anywhere between 1 per cent and 3 per cent of the remaining loan amount to be paid back as the charge.

Waiting Period – Your loan agreement with your current lender will determine when you are allowed to transfer your loan. You will have to wait until you pay the stipulated amount or complete the waiting period as stated in your agreement before you can find a new lender.

New Tenure and Interest Rate – The point of transferring your home loan is to get a better deal, unless you have severe service issues with your lender. You should try and reduce your tenure in such a scenario to pay off the loan earlier and also look out for lenders who offer a better rate.

Clear Any Pending Dues – The bank will need to give a clearance certificate that will allow the new lender to take charge of the loan. For this clearance you need to make sure that all your pending dues are clear. For instance, pending EMIs and late payment charges need to be paid off before you can transfer your loan.

Also if your home loan is on a fixed interest rate, you will have to pay a pre-payment penalty to transfer your loan. You may want to rethink about transferring your home loan in such a scenario as the penalty may eat up on the advantage given by the new lender.

Collateral Revision – Home Loans are automatically collateral loans as the said property papers will lie with the bank until the entire loan is cleared. If you have already repaid a huge chunk of your loan, do not offer the complete original collateral to your new bank. It is like giving a security which is double the amount of your loan outstanding in some cases. You can use it to take a separate loan instead, if the need arises. Instead, offer your new bank a lesser amount of collateral. If the bank still insists, negotiate for reducing the interest rate further.

Credit Card Charges

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Joining or Annual Fee

While many credit cards come free of cost, i.e. no joining fees and perhaps exemption from annual fee for a particular period, the ones with bigger rewards and benefits generally tend to have a joining fee. Some may waive off the joining fee for the first year but may have it from the second year. Sometimes these charges are waived off if one spends up to a threshold specified by the bank.

Interest and Finance Charges

Most credit cards offer a 42 to 50 day interest-free period to pay for all spends. Some premium cards have finance charges regardless of where and when the card is swiped. But once the interest-free period passes, banks will levy an interest/finance charge to be borne by the customer if the full payment is not made on time.

Cash Withdrawal Charges

Credit cards also allow you to withdraw cash from ATMs. This option should be exercised only in emergencies. While there’s an interest-free period for all other credit card transactions, the interest rate applies immediately for cash withdrawals. If you withdraw cash in an emergency, repay it as soon as possible to avoid the hefty interest rate. (Minimum 300/- per withdrawal)

Over Limit Charge

There is a charge if you breach your credit limit and cash withdrawal limit. For instance, if your credit limit is Rs. 1 lakh but you have spent Rs. 1.25 lakhs on the card, be prepared to pay a charge. Normally a percentage of the excess spend is charged as penalty. So make sure to keep track of your spending and if you think you need to make a big purchase deposit the deficit amount by cash to the card if necessary.

Late Payment Charges

A late payment on your credit card bill can be disastrous in many ways. Firstly, your credit score gets affected, and secondly, you have to pay a late fee each time you are late in paying dues. While some banks charge a standard late fee, some charge a percentage of the amount due as late fee. Some may even charge an additional fee if your ECS for the credit card payment gets rejected.

In case you don’t have the full amount to repay your card, make sure to at least pay the minimum amount due, in order to avoid the late payment penalty.

Foreign Transaction Fee

Whenever a credit card is used for foreign transactions, whether online or at a point of sale, the bank levies a foreign mark-up fee. It ranges anywhere between 1.5 per cent and 5 per cent depending on the bank and the card. Cash withdrawals abroad are charged at a higher rate that card swipes. So when abroad you can carry enough cash or get a travel card to avoid these charges.

Balance Transfer Fee

A balance transfer is when you pay off the balances on existing credit cards or loans by transferring them to another credit card account. While many high value cards allow this free of cost, in some cases you may be charged a fee to complete the balance transfer – typically a percentage of the transfer balance. It is basically an expensive way to move money from one account to another, rather moving debt from one account to another, and you must avoid getting to this point by repaying your debts in a timely manner.

Under-reporting or misreporting your income to ITD?

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As a taxpayer, it is very important for you to know that while filing the (ITR) income tax return, if a person under-reports his income or inflates his deduction/exemption, then the Income Tax Department (ITD) can impose a penalty on him under Section 270A of the Income Tax Act, 1961. You must be wondering that the Section 270A of the I-T Act is not a new section as it was introduced two years back in the Budget 2016. Then why is it being discussed now? Well, this section has become more important from this year because of the two recent moves of the I-T Department.

Firstly, the department has recently issued a cautionary advisory to all the salaried taxpayers who will be filing the IT returns for FY:17-18 to report their income correctly. This move has apparently been taken in order to stop all the malpractices which are being resorted to by the salaried taxpayers in order to evade tax.

Secondly, the department has also come up with the changes in the ITR Form 1 (Sahaj) for FY:17-18 which now seeks specific and complete details of your salary and house property income. Earlier, such details were not required; only the total figure was to be disclosed.

Now, let’s understand that what exactly is under-reporting or misreporting of income and how much penalty would be levied in such cases.

“As per Section 270A, if any person under-reports or misreports his income, then an assessing officer (AO), a commissioner (appeals), a principal commissioner or a commissioner may direct him to pay penalty in addition to the tax, if any, on such income. This penalty is to be paid over and above the taxes,”

Under reporting of income can be based on various circumstances. Like, if the income of a person exceeds the basic exemption limit, but still he does not file a return, then it will be considered as a case of under-reporting. However, “the cases of misreporting of income as defined in the Income Tax Act are misrepresentation or suppression of information; failure to record investments in the books; claim of expenditure without any evidence; recording of false entry in the books, failure to record receipt in books which is having effect on total income; and failure to report any international transaction or deemed to be an international transaction,” says Soni.

What is the penalty?

If the under-reporting of income is on account of misreporting of income, then the penalty shall be leviable at the rate of 200% of the tax payable on such under-reported income. However, if it is due to any other circumstances, then the penalty shall be 50% of tax payable on under-reported income.

Illustration, “if my income is, say, Rs 15,00,000/- i.e. I am in the 30% tax bracket, and have under-reported an income of Rs 2,00,000/- in ITR, then the AO can impose a penalty of up to about Rs 30,000/- (50% of the tax on under-reported income, i.e., Rs 60,000/- (2,00,000*30%)). However, if the under-reporting is due to misreporting of income, then penalty can be up to 200% of the tax on unreported income, i.e. 200% of Rs 60,000/-, amounting to Rs 1,20,000/-,”

However, an assessee may apply to the AO with explanation that why under-reporting or misreporting occurred. If satisfied, then the AO may not penalise the assessee or may reduce the quantum of penalty.

Therefore, from this year onwards you must be extra careful while filing your income tax return (ITR) for FY: 17-18, and disclose all your incomes under the respective heads. Otherwise, you may have to pay penalty u/s 270A for under-reporting or misreporting of your income along with the applicable taxes. So, be vigilant and file your IT return correctly.

Why paying more for bank services!

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These steps you can take to avoid paying more to your bank.

Use the ATM wisely
Why: Several banks allow only five free transactions, even at their own ATMs. If you can’t do without cash, withdraw larger amounts at a time to avoid paying more.
You save: Rs 10-20 per withdrawal, Rs 5-8.50 for non-financial transactions.

Junk the cheques, switch to Netbanking
Why: Every additional chequebook attracts charges. Transfer funds through Netbanking for free.
You save: Rs 20-150 per chequebook, depending on number of leaves.

Clear credit card bills on time
Why: The outstanding amount will continue to attract hefty interest rates.
You save: 39-42% per annum in interest. Delay of three days could attract charges of up to Rs 750.

Take the auto-debit route for card bills
Why: Set up an auto-debit mandate instructing your bank to deduct a minimum 5% of credit card bill on due date to avoid steep penalty.
You save: 39-42% per annum that would have been levied on the unpaid amount.

Sign up for Bill Pay services
Why: Utility companies levy late payment fee on delayed bill payments. Bill pay services or standing instructions to your bank ensure your bills are cleared on time.
You save: Penalties ranging between from Rs 40 and Rs 100, depending on the utility company.

Opt for duplicate statements on email
Why: Banks charge a fee for issuing duplicate physical statements or passbooks.
You save: Rs 100

Avoid cash transactions at branches
Why: Banks allow 3-4 free cash transactions at branches in a month.
You save: Rs 50-150 per transction.

Maintain minimum balance at all times
Why: Not maintaining the required balance attracts non-maintenance charges.
You save: Rs 10-600 per month.

Do not issue cheques when the balance is inadequate
Why: Not only can dishonouring cheques attract charges, it is also a criminal offence under the Negotiable Instruments Act.
You save: Rs 500-750 per cheque.

Issue stop payment instructions online
Why: Some banks charge a fee for countermanding cheques through the physical route.
You save: Rs 100-200.

Never withdraw money with your credit card
Why: Issuers levy a transaction fee, in addition to interest payable.
You save: 2.5% of the amount withdrawn or a minimum of Rs 300-500.

Don’t exceed your credit limit
Why: If your card usage exceeds the credit card limit granted to you, your card issuer will levy a fee for extending this facility.
You save: 2.5% of the over limit amount or Rs 500.

Tax rules you should know to plan your savings for F.Y.- 2018-19

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With the starting month of the F.Y.-2018-19 , it is a good time to start reviewing your tax-saving plans. And to do so, you must know the new tax rules that are effective from financial year 2018-2019.

Standard Deduction

In Budget this year, the government introduced, rather reintroduced, standard deduction of Rs 40,000 on taxable income. This standard deduction is in lieu of the annual transport allowance of Rs 19,200 (Rs 1,600 per month) and the annual medical reimbursement of Rs 15,000. The effective additional exemption stands at Rs 5,800 annually.

The deduction will be made directly from the salary, thereby, doing away with the cumbersome process of submitting bills. A tax-paying pensioner is also entitled to claim a standard deduction of Rs 40,000.

All about taxes and investments of an individual

Education Cess

The Budget raised the education cess on income tax from 3 per cent to 4 per cent. Earlier, the cess included 2 per cent education cess and 1 per cent secondary and higher education cess. The hike in education cess means one has to pay more tax.

Non-Salaried Get NPS Exemption

In good news for non-salaried individuals, contribution up to 20 per cent of the gross income to the pension account is eligible for deduction under Section 80 CCD (1) of the Income Tax Act, 1961. Earlier, the maximum deduction allowed to non-salaried individuals was capped at 10 per cent of the gross income.

Exemptions for Senior Citizens

According to Budget 2018, the tax exemption on income from interest from bank deposits and post offices has been increased from Rs 10,000 to Rs 50,000. The deduction limit for health insurance premium or medical expenditure has been raised from Rs 30,000 to Rs 50,000 under Section 80D.

Further, deduction limit for medical expenditure on critical illness is now Rs 1 lakh for all senior citizens under Section 80DDB. Earlier, the limit was Rs 60,000 for senior citizens and Rs 80,000 for very senior citizens.

Long-term Capital Gains Tax on Stocks

This year’s Budget saw re-introduction of the long-term capital gains (LTCG) tax on stocks. Investors will have to pay 10 per cent on profit exceeding Rs 1 lakh from sale of shares or equity-oriented mutual funds held for more than a year. All gains up to January 31, 2018 have been exempted.

ITD Warns Salaried Class Against Filing Wrong Returns

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Income Tax Department Warns Salaried Class Against Filing Wrong Returns

The Income Tax Department on Wednesday cautioned salaried class taxpayers against using illegal means like under-reporting of income or “inflating” deductions while filing their returns, stating violators will be prosecuted and their employers will be intimated to take action against them.

The Central Processing Centre (CPC) of the Department in Bengaluru, that receives and processes the Income Tax Returns (ITRs), has issued an advisory specifying such taxpayers should not “fall prey” to unscrupulous tax advisors or planners who help them in preparing wrong claims to get tax benefits.

Calling it a “cautionary advisory” on reports of Tax evasion by under-reporting of income or inflating deductions or exemptions by salaried taxpayers, the department said such attempts “aided and abetted by unscrupulous intermediaries have been noted with concern”.

“Such offences are punishable under various penal and prosecution provisions of the Income Tax Act,” it said.

The advisory comes in the backdrop of the investigation wing of the department, in January, unearthing a racket of extracting fraudulent tax refunds by employees of bellwether information technology companies based in Bengaluru, in alleged connivance with a tax advisor.

The CBI recently registered a criminal case to probe this nexus.

The tax filing season for salaried class taxpayers has just begun with the Central Board of Direct Taxes (CBDT), that frames policy for the department, recently notifying the new ITRs.

The one-page advisory added that if the department notices any fraudulent claims in their ITRs, such claims “may be punishable under provisions of the IT Act and this may also delay issuance of their refunds.”

“Taxpayers, are, therefore strictly advised not to fall prey to false promises or mis-advice by unscrupulous intermediaries and submit wrong claims in their ITRs, which would be treated as cases of tax evasion. In the cases of such wrong claims by the government/PSU employees, reference would be made to the concerned vigilance division for action under conduct rules,” it added.

The advisory added that the department possesses an “extensive risk analysis system” that is aimed at identifying persons who are non-compliant and aim to subvert the trust based-system “envisioned” while processing of ITRs at the CPC, which it said is automated and devoid of any human interface.

“In all such cases of high risk , the department may examine and verify the details submitted by taxpayers in their ITR subsequent to the processing of returns,” it said.

It also asked tax planners and advisors to “confine their advice to taxpayers within the four corners of the IT Act” and warned that the violators will be prosecuted and such instances will also be referred to enforcement agencies like the CBI and the Enforcement Directorate (ED) for criminal prosecution.