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Showing posts from June, 2012

“LIC COMMISSION INCOME: WHETHER BUSINESS OR PROFESSION”

TAX TALK-02.07.2012-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “LIC COMMISSION INCOME: WHETHER BUSINESS OR PROFESSION” Query 1] Mr. X is having commission income of Rs. 15,82,760/-. The Commission is derived from LIC, Sahara & HDFC. Whether his income is professional income or business income? Because, if it is a professional income, then he has to get his books audited u/s 44AB. Otherwise, can he file his return u/s 44AD in ITR 4S. Apart from doctors, lawyers, architects, CA’s who else can be professional? What norms have to be taken into consideration? Please clarify. [saju_sak@hotmail.com] Opinion: 1.A person who is carrying on business is required to get its books of accounts audited if the gross sales/receipts/ turnover exceeds Rs. 60 Lacs for the Financial Year 2011-12 (The limit has been enhanced to Rs. 1 Cr from the F.Y. 2012-13).A person who is carrying on profession, the limit for audit for the F.Y. 2011-12 is Rs. 15 Lacs (From FY 2012-13, it is Rs. 2…

TAX TALK-25.06.2012-THE HITAVADA

TAX TALK-25.06.2012-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “WRONG SUBMISSION OF FORM NO. 15G & THE CONSEQUENCES” Query 1] 1.I retired on Dec.-2011 under the VRS scheme. I have got all my dues and retirement benefits on Jan-2012, which is exempt from tax. 2.My net Taxable Salary after deductions under chapter VI-A was Rs. 2,45,020/-. The employer had deducted TDS amounting Rs. 8,500/- whereas my tax liability was at Rs. 6,700/-. Later I invested my savings in FD with SBI for a period of 5 years on Jan.-12 & the interest is deposited on a monthly basis. As I was under the impression that excess tax is already deducted from my salary income, I directed the bank not to deduct TDS on interest and accordingly filled up the Form No. 15G and submitted it to the bank. Now at the year end, I came to know that the total interest I have received up to March-12 is around Rs. 37,000/-. Thus, I have to pay additional tax in excess of my TDS amount. Hence, my queries …

TAX TALK-18.06.2012-THE HITAVADA

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TAX TALK-18.06.2012-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “INVEST IN BUSINESS & SAVE LTCG TAX” Query 1] Presently I am a salaried assessee working in a private company & will be resigning from the company. I will be getting around Rs. 27 Lacs as retirement benefit which I intend to utilize for setting up of a new business. I am also planning to sell an agricultural land and plot in the current financial year & wish to utilize the amount for setting up of my own business. I had already purchased an Industrial plot in the year 2008 at Butibori, MIDC. In the recent budget, I have heard about the new scheme which makes profit arising on sale of property, tax free if it invested in setting up of a business. Whether I can save my tax on sale of plot & agricultural land if I invest it in the new business? Please advice. [rao2319k@gmail.com] Opinion: A new section 54GB has been incorporated in the Income Tax Act-1961 which provides exemption in respec…

TAX TALK-11.06.2012-THE HITAVADA

TAX TALK-11.06.2012-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “RECEIPT OF SALARY IS NOT THE CRITERIA FOR ITS TAXABILITY” Query 1] The Quarterly TDS certificates are sent by the Companies/Banks by post or courier. But for some reason or other, if it is not received, then involves unnecessary follow up with the companies. To avoid this, can I use TDS-data/information like TAN of Deductor etc reflected in Form 26-AS, for filing Income Tax Return. Please advice in the matter. [vdpankey@rediffmail.co] Opinion: Assessee can file the Income Tax return on the basis of TDS credit reflected in Form No. 26AS rather than waiting for the TDS Certificate from the concerned Deductor. Now, the income tax department is also relying mainly on the amount reflected in 26AS for granting TDS Credit to the assessee. However, it is advisable to get the copy of the TDS certificate for record purpose as the option of filing the revised TDS return is always available with the Deductor.
Query…

TAX TALK-04.06.2012-THE HITAVADA

TAX TALK-04.06.2012-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “PURCHASED RESIDENTIAL PROPERTY & USED FOR COMMERCIAL PURPOSE” Query 1] I am a CA Student & I would like to obtain your opinion on the following issue. My parents are practicing doctors. They have purchased a residential flat in Joint Name & are planning to conduct their practice from the said flat. 1.Can my Father and Mother, individually, claim benefit of stamp duty paid for the purchase of the flat and Amount of Repayment of Principal as deduction u/s 80C? The flat will be used purely for commercial purpose. 2.My mother is a pathologist. She conducts her practice in a Partnership firm, XYZ, whose operations are carried on in the above mentioned flat. Can XYZ (the partnership firm) show payment of rent to my father (who happens to be a part owner) for taking his part on rent and claim it as an expense? And can my father show payment of rent to my mother (who is also a part owner) for taking…