Yearly Archives: 2018

An internal audit might not look a necessary thing to a lot of people, but it’s important. It’s, specifically, the case with small businesses that don’t feel like spending on the little resources they have on internal audits. This, however, is a sheer ignorance.

Internal audits play a major role if you want to provide your clients with efficient and secure services. And that’s exactly what your business goals are, isn’t it? In case you feel you’re lacking somewhere in these programs, take help of advisory and planning services of an expert to help you get started with the financial activities such as auditing.

What is internal auditing?

Auditing financial statements means keeping accurate records of all your financial transactions. While you can get your statements audited internally by crisscrossing the work of one department to another, it’s better to hire an expert to make a report on the accuracy of the statements. That’s because the former will require a complete training program for your employees. The best chartered accountants in Ambala, India are always available with their excellent auditing services.

Internal auditing has its own share of importance in filling the gaps in a company’s policies and procedures. They are held to manage risks and ensure a company’s policies are in compliance with the relevant laws and regulations. Let’s take a look at everything internal auditing can do for your business.

Why is internal auditing important?

1. It provides an objective insight

There’s hard to audit your own financial statements impartially. Therefore, you’ll have to take a helping hand to make a fair judgment. While you can train your own employees to do the task, taking the helping hand of a professional is always a more economical idea. Besides, they can achieve the objective insight more accurately.

2. It boosts the efficiency of operations

The objective insight into the policies and procedures of your company ensures that you’re operations are on the right track. And if any gap is found, you can mend it at the right time. By monitoring, reviewing, and mending your processes, you can attain more efficiency and effectiveness in your operations.

3. It examines risks and safeguards assets

Internal auditing is a key tool to assess risks. The management and stakeholders come to identify any changes in the environment. Besides, they get to know which risks to prioritize and which to address later. In this way, they can make an effective remediation plan at the right time. if there is any gap found in the environment, you can overcome it systematically.

4. It ensures compliance with laws and regulations

If a company performs an internal audit on a regular basis, it can make sure the policies and procedures are complying with all the relevant laws and regulations. In this way, it saves you from costly fines you can face in a non-compliance state and prepares you for the next external audit. Isn’t this a big relief?

5. It makes your business name more reliable

Once the financial audit officials have kept up their faith in your internal audits, your authenticity improves and your clients can trust you more. Carrying out an internal auditing program from time to time highlights your professionalism as well.

If cross-training your employees to audit departments does not sound like your move, you can always look for expert financial advisors to get best management consultancy services for all your financial matters.

A number of elements contribute to the success of a business. Consider, for example, product and service quality, brand value and marketing skills. But what is it that manages all of these things? All businesses need the helping hand of a chartered accountant whose financial advisory and planning services can escort you from zero to zenith within days.

The general conception is this that a chartered accountant is only needed to file tax returns and make balance sheets of your company – but there’s much more to it. A seasoned financial advisor is an essential asset to shape your business’s current structure and ensure your company’s growth graph always points north.

Bookkeeping

Bookkeeping or record keeping is the foundation of a business’s financial system. It means keeping all the records of your financial transactions for your business. If done properly, bookkeeping can be one of the primary reasons for your business expansion. That’s what a CA takes care of. He analyzes all your transactions, looks into the possibility of claiming for tax relief, prevents any undue expense, and makes provisions for business expansions whenever possible.

Formulating Business Plans

It’s the extensive knowledge in their field and strategic understanding of the current and potential situation that help chartered accountants in planning business growth.

The professionals in the field are well-versed in all terms and terminology of accounting. Once they get familiar with your brand, they can proficiently analyze how productive a business plan and strategy can be for you. Additionally, they can fine tune your existing business plans to make the most of all possible opportunities.

Auditing

Auditing refers to the official inspection of a company’s accounts and records, and it’s an extremely tedious task. However, hiring a professional CA will make things sail smoothly as they are brilliant at their job and can prevent any hiccups from interrupting your business affairs.

Cost Controls

Yes, true…chartered accountants are expert in making budgets by balancing the fixed and variable costs incurred by companies. In fact, no one other than a CA is a good option when it comes to cost controlling and increased profits, both in dull and fast expanding days.

Financial Compliance

With the growth of a business, many complexities revolving around business procedures and tax requirements shoot up. Now, this is where you can put the expertise of an expert financial advisor to good use. A specialist in the field will assist you in effective tax planning and consultancy to cut down the tax you pay to the government. Besides, they use their experience, knowledge, and foresight to prepare in advance for approaching taxes. You can always count on professional CAs to be in compliance with all the relevant regulations and stipulations.

Merger and Acquisition

It is the valuable counsel of an expert CA that can be utilized to expand business operations through mergers and acquisitions. A knowledgeable chartered accountant will analyze the financial and legal implications to decide if the deal is profitable in regards to the present costs and potential growth.

While there’s much more an experienced CA can do for your business, these 6 are the ultimate services which, if given a careful consideration, can help you script a success story for your business. In case your business needs the expertise of one of the best-chartered accountants in Ambala, India, contact us for assistance.

As per financial calendar, New Year starts from April 1, bringing changes to many things in personal finance and every tax payer needs to be aware of the new rules in income tax as these not only impact our earnings but also our day-to-day lives. Right from the introduction of LTCG in equities to the introduction of standard deduction for salaried employees, a number of tax changes have been announced by the Finance Minister. Let’s go through the major 5 tax changes you need to know.

1. Pay LTCG tax on stock market investments

Profits made through stock market investments are not exempted anymore. Now, you will have to pay 10% tax on your profits if you held equity-oriented mutual funds and stocks for one year. The tax implements to only those whose profits exceed Rs 100,000 in a financial year.

Please note that your profits made till Jan 31, 2018 are protected, as the rule will come into effect for profits made after 31^st Jan.

2. Higher CESS

A new CESS has been proposed: Health and Education CESS. This time it has been increased by the government from 3 percent to 4 percent for individual taxpayers on the amount paid as income tax.

3. Senior citizens can get medical treatment for specified diseases

Currently, resident individuals and HUFs (Hindu Undivided Families) get benefit of the deduction for the amount proposed for the medical treatment of diseases like malignant cancers, AIDS, etc. For now the deduction of amount is limited to Rs 60,000 for senior citizens and Rs 80,000 for very senior citizens. The new budget has proposed to make enhancements in the deduction limit and increased it to Rs 100,000 equally for both senior as well as very senior citizen categories.

4. Income tax benefit on NPS withdrawal

In budget 2018, Indian finance minister announced the extended benefit of tax-free withdrawal on NPS (National Pension System) to non-employee subscribers. At present, non-employee subscribers are not allowed to enjoy this exemption. The new budget proposes to extend the benefit of tax-free withdrawal from NPS.

5. Reintroduction of standard deduction

W.e.f financial year 2006-07, standard deduction (available only for salaried people) got abolished. Now the government has again introduced standard deduction and provided exemption relating to transport allowance and medical expenses. This is surely going to benefit more than 2.5 crore salaried employees. Due to the introduction of standard deduction by the government, the salaried class of India is going to enjoy a flat deduction of Rs 40,000 from the income they pay as tax.

Are you interested to lower your tax outgo on your salary? If yes, then we’ve got you covered. This post covers some infallible ways that can be used by salaried individuals to make the most of their saving.

1. Consider submitting your medical bills on time

To save tax on your salary, it is favourable to safely keep all the receipts of your medical expenses. Doing so can help you gain the tax benefit on your as well as your dependents medical expenses of up to Rs 15.000.

2. Gain tax benefits on rent paid

Salaried individuals can claim tax benefit on HRA if they live in a rented accommodation. This can be partially or completely exempt from tax.

3. LTA deduction for travel expenses

This is another best method to save tax for salaried individuals. You can claim LTA (Leave Travel Allowance) two times in a period of four years. It is not a mandatory benefit; it’s all up to your employer that while deciding your pay structure, LTA can be included or not.

4. Daily Travel Allowance

Employees can also use this tax saving tip to gain some tax relaxation. You can ask your employer for daily travel allowance. However, it is implemented to support your expenses only of the commute between work place and residence. Daily travel allowance of Rs. 1,600/month is exempt from tax.

5. Ask for meal coupons

You can ask your employer to pay a portion of your salary in form of food coupons. These are liable up to Rs 55/day. Therefore, you can get a part of your salary in form of meal coupons for 22 working days for up to 2 meals which results in around Rs. 26,400/year tax saving.

6. Consider purchasing medical insurance for your family

According to section 80D, a salaried individual can claim a deduction of maximum Rs. 25,000 by purchasing medical insurance policy for him/herself as well as for his/her family (spouse and kids). To get the additional benefit, you can also buy medical insurance for your parents and claim Rs 30,000.

7. Money under VRS

Public sector employees doing job under the State or Central Government can avail this tax benefit. If such an employee opts for voluntary retirement, then the money he/she receives as a result of VRS is free from tax up to Rs. 5 Lakh.

Have you ever considered that how to save tax on your income? Whether you are a first-timer or old-hand taxpayer, if you’re not planning your taxes in a proper manner, then there is a probability that you are paying more taxes than you should. Most people find the process of tax laws really complex that they are startled to deal with it. We recommend you to don’t fall into the category of startled people. Saving tax is, honestly, not as complex as you think. There are many things which can help in saving tax for you. This post covers some completely legal ways that can be used by you to save tax. Let’s check them out:

1. Tuition Fees

People spend a significant amount of their income to make their kids educated. I-T laws help you compensate those expenses by reducing your taxes. You can anytime claim such deductions as per the 80C of I-T Act.

2. Education Loan Repayment

These days, a heavy rise in the cost of various education courses has been witnessed and to do such courses people often opt for education loans. Similar to deduction available on the tuition fees, education loan EMI’s submitted by you can also bring tax benefits. As per the 80E section of Income Tax Act, you can get the tax benefit for the interest paid by you on your education loan.

3. Medical Insurance

Health check-up and medical expenses are a part of every individual’s life. If you spend some money from your income on medical insurance or towards preventive health check-up, then as per tax laws you can get some tax gains. According to the section 80D of Income Tax Act, an individual can get a deduction up to 60,000 Rs. To get the benefit, you are advised not to pay your premiums for Medical Insurance in cash.

4. Pension Funds

Preferably, from the day one starts earning money, he/she should start planning the day of their retirement. One of the ideal ways to do so is to invest income in pension funds. Luckily, this can help you reduce your taxes. In such cases, provision related to the tax benefits are covered under various sections that includes Section 80C, Section 80CCC, Section 80CCD(1), Section 80CCD(1B), and Section 80CCD(2).

5. Home Loan Repayment

You’ll be delighted to know that by paying your home loan EMIs, you can reduce the burden of taxes. Best of all, you can get the advantage of both interest and the principal component of your installments. If the case is that you are paying installments for your first home then a huge amount of tax can be saved. Home Loan Repayment deductions are covered under various sections that include Section 24, Section 80C, and Section 80EE.

Why not start using aforementioned tax saving methods from today onwards and get set to optimize your tax life. If you have some other best ways to save tax on your income in your arsenal then don’t forget to post your views in the comment section below. Happy Tax Savings!

Wanna file income tax return on your annual income? If you are not familiar with the fiddly process, better to take assistance of a professional who can do the work for you at the blink of an eye. In case you are planning to file income tax return from your own, you need to keep some things in mind before proceeding. Whether you are filing income tax return online or via post, during the process (which is often exercised at last minute) you may miss some important information or even commit some mistakes. This post covers the list of five such mistakes that should be avoided while filing income tax return. Let’s get started:

1. Not defining all your income sources

This is the most common mistake people attempt while filing income tax return. Interest earned on FDs or bank saving accounts is often forgotten by many individuals. Let’s tell you that this income is taxable as per your relevant tax slab. Banks, as a rule, deduct 10% TDS on the interest an individual earned on FDs. However, if an individual fall under a higher tax slab, he/she has to pay income tax accordingly. If such incomes are not reported by an individual, it may fetch a notice from the department of Income Tax.

2. Not paying tax on your house property

There is a notion in the mind of many people that even after having multiple residential properties, there is no need to pay income tax, but in actual it is a misconception. If you have more than one residential property, then you are supposed to pay income tax for that, even if the property is unoccupied and you are not earning any income from it. There is no income tax on the house you occupy. Other than that, tax is to be paid for all other houses you have.

3. Providing incorrect personal information

Income tax department communicates regarding all the necessary information via email or post, thus it is extremely important to provide all personal details accurately before filing income tax. Your minor mistake can wreck havoc and you might miss some important notifications. Therefore, it’s always necessary to check/recheck your personal information like postal and email address while filing your income tax.

4. Not informing about the exempted income

There are many types of income that are exempted from tax. Though there is no need to pay income tax for incomes like dividends or long-term gains, reporting about them to the income tax department is a necessity. Remember that, if you are not reporting about such incomes, income tax department may get such details from the investment company or brokerage house.

5. Not verifying the income tax form before filing

Whether you have opted for filling the income tax form offline or online, mistakes may happen. Therefore, it is recommended that you must cross check the filled-up form carefully in an attempt to avoid any mistakes. Even if you’ve assigned the task of filling your form to your tax consultant or accountant, you need to verify the accuracy of the information by personally checking it.

Goods and Services Tax (GST) is the only indirect tax for the whole nation, making India a unified market. It is levied on the supply of goods and services, right from the manufacturer to the consumer. Despite the fact that GST has taken the world by storm, many businesses are still unfamiliar with the process required for GST registration. That’s why; we’ve come up with this tutorial to make you aware of the registration process of this new taxation regime. Continue reading.

What is GST Registration?

Every supplier of goods and services who makes a taxable supply with an aggregate turnover of more than Rs. 20 lakhs (Rs. 10 lakhs for NE and hill states) in a financial year is mandatory to register as a normal taxable person. And the process of registration is known as GST Registration. In case an organization continues doing business with no registration under GST, it will be an offense under the new tax and heavy penalties will be applied.

What is GST Registration Number?

GST Registration Number or GSTIN is a 15-digit identification number that is assigned to each candidate who applied for GST Registration. It is entirely based on the PAN number and State code. First two digits embody the State code, another 10 digits represent the PAN number of the applicant, one digit stands for the entity code, one digit is blank, and the last one represents the check digit.

Who Should Register for GST?

The following persons are required to register for GST:

• Individuals registered under the Pre-GST law such as VAT, Service Tax, Excise, etc.
• Businesses whose turnover exceeds the threshold limit of Rs. 20 lakhs (Rs. 10 lakhs for the North-Eastern States)
• Individuals making interstate supplies
• Casual taxable persons
• Non-resident taxable persons
• Agents of a supplier and input service distributor
• Folks who’re paying tax under the reverse charge mechanism
• Every e-commerce operator
• Persons supplying online information and database access or retrieval services from a place outside the country to a person in India, except a registered taxable person

What’re the benefits of registering a business under GST?

Registration under GST will confer the following benefits to the business:

• Legally recognized as goods and services’ supplier
• Legally authorized to collect tax from their customers as well as pass on the taxes credit paid to them
• Easy flow of Input Tax Credit from the suppliers to the recipients nationally

Documents required for GST Registration

The following documents would be required to obtain GST registration:

• PAN card of the company
• Proof of organization like partnership deed, certificate of incorporation, Articles of Association (AOA)/Memorandum of Association (MOA)
• Details and proof of place of business such as electricity bill and rent agreement
• Cancelled cheque of your bank account incorporating name of account holder, IFSC code, MICR code, and bank branch details
• Authorized signatory such as list of directors with their identity and address proof in case of company or list of partners along with their identity and address proof in case of partnership firm

GST Registration Process

You can register for GST by navigating to https://www.gst.gov.in/ link. The applicant will need to submit an online application for GST registration with the Form GST-1 in tandem with details of the goods and services to be dealt. The registration payment will be made online. After the submission of the application, a temporary GST registration number would be provided. While submitting the application, the candidate would need to print a copy of the application, attach the aforementioned documents, and final GST certificate will be issued by the concerned officer.

Taxation plays a vital role in the economic development of any country. It is a system used by government of any country to raise or collect revenue from the public. Any government makes use of the collected revenues for the wellbeing of society in different forms such as by paying wages to police or soldiers, by constructing dams or roads, by operating hospitals and schools, by providing meals and medical services to the poor people, and so on. It is difficult for any government to exist without collecting taxes. For maintaining equality in a society, it is necessary to impose taxes on society.

Understand the term ‘Tax’

Tax can be defined as the part of income collected by government from us to provide several facilities like school, medical, water and drainage system, roads constructions, etc. It is a required payment charged by government of any country on individuals or companies for meeting the expenditure which is requisite for the welfare of a society.

Let’s walk through some the features of Tax:

• Tax is a compulsory payment for the benefit of society
• It needs legal sanction
• It is considered as a personal responsibility
• Tax is waged out of the total income earned by the tax payer

Taxation Structure as per Indian Viewpoint

In India, mainly two types of taxes are implemented:

1. Direct Tax: This tax is paid directly by people of India to the government. Direct tax is further divided into various types as given below:

1.1 Income Tax: As its name implies, it is a tax on the total income of a tax payer

1.2 Wealth Tax: This tax is charged on the net assets

2. Indirect Tax: This tax is indirectly paid by the people of India to the government. Indirect tax is further divided into various types as given below:

2.1 Central Excise Duty: It is levied on manufacture or production of goods

2.2. Custom Duty: This type of tax is charged by central government on the import and export of goods from India

2.3 Value Added Tax: It is a tax on the sale of goods which is implemented within the states only. VAT is a multi-stage tax and is paid by the wholesaler, retailers, manufacturer, and is also transferred on consumer.

2.4 Service Tax: Service Tax is a tax levied on taxable services. In this, usually service provider pays text and then recovers it from the consumer from the receiver of the taxable service

Income tax is a tax levied directly on the earnings of an individual, association, and business by the government to finance its several operations. Income tax is of two main types: Direct tax and the newly introduced Goods and Services Tax (GST) that subsumes almost all the State as well as Central taxes, including excise, VAT, and service tax.

In addition to funding the government activities, taxes also serve as a fiscal stabilizer helping distribute wealth equally among the population. Taxes are even influential in mitigating the effects of financial cycles. The payment of income tax in India is made as per the terms defined under the Income Tax Act.

In accordance with the Indian Income Tax laws, income from five main sources is deemed taxable. Allow us to explain them briefly:

1. Income from Salary

In case there’s a relationship of an employee and employer between the payer and the payee then an income can be taxed under Salaries. In contrast, if there’s no such relationship, the income will not be considered to be income from salary.

2. Income from House Property

This type of income tax is referred to the tax on rental income that is being earned from the House Property. Nevertheless, if the property is not being leased, tax will be charged on the anticipated rent that would have been received if this property was leased. Income from House Property is possibly the only income, which is levied to tax on a national basis.

3. Income from Profits and Gains of Business or Profession

Under this income head, any earnings received from any manufacturer, business or trade will be liable to tax after deducting particular expenses.

4. Income from Capital Gains

Any revenue or gain resulting from the transfer of a capital asset effected in the financial year will be chargeable to income tax.

5. Income from Other Sources

Under this head of income, any earnings that are not liable to tax under the aforementioned four heads of income will be chargeable, given that earnings are not exempted from the calculation of total income.

In India, the tax rates differ as per the income of an individual, alias Income Tax Slab. The slab is modified every year by the government during Budget Session of Parliament.

Ever since the inception of the Goods and Services Tax, taxpayers are required to fulfill a bunch of compliances which mandates them to file several returns for each Financial Year. In simple words, GST Return filing is compulsory for all those folks who have GST Registration. In order to make you better understand the procedure of Goods and Services Tax Return filing, we’ve come up with this tutorial. Let’s delve in.

What are GST Returns?

Returns are a set of forms boasting a pre-approved reporting format. This make terms of essential information easier for the taxpayers for the entire disclosure. Each form has been intended to make sure the complete disclosure of transaction made between sellers and buyers.

Who Should File GST Returns?

Under the GST administration, any regular business is required to file three monthly returns (GSTR 1, GSTR 2, and GSTR 3) along with one annual return (GSTR 9). There’s one more return dubbed GSTR 4 that is submitted on a quarterly basis by composition taxpayers.

Types of Returns under GST

1. GSTR 3B

To make the migration process of taxpayers easier than ever, Government introduced an interim return form of GSTR 3B for the month of July and August. The form doesn’t require you to provide invoice level information. However, you must need to provide the total values for each field.

2. GSTR 1

This form requires you to give all the details of the outward supplies of goods and services to the department. It’s worth notable that you should file the form by the 10th of every following month.

3. GSTR 2

Through this form, you’ll get the details of the inward supplies of goods and services as sanctioned and approved by the recipient of the goods or services. This form must be filed by 15th of the following month.

4. GSTR 3

This is the auto-populated form consisting of all the details filed under GSTR 1 and GSTR 2. This would let the department estimate the tax payable after making an allowance for Input Tax Credit availability. The form is recommended to be filed by the 20th of every following month.

5. GSTR 4

This form includes all the details given in the auto-populated form of outward supplies. The form has to be filed by the 18th of the succeeding month after each quarter.

6. GSTR 5

The form comprises of the details about input tax, outward supplies, tax paid, reaming month, and imports. This is a monthly submission form which must be filed by 20th of the succeeding month.

7. GSTR 6

This form is all about the details regarding return for input service distributor. This form is recommended to be filed by input service distributor by 13th of every following month.

8. GSTR 7

This form is to provide all the details about the tax deduction. It needs to be filed by 10th of the every following month.

9. GSTR 8

This form includes all the details concerning supplies made by the e-commerce seller. It also incorporate details of the tax deducted at source. You have to file the form by 10th of every following month.

10. GSTR 9

This is an annual return form that requires to be filed by every taxpayer by 31st of the following financial year.

11. GSTR 10

This form provides all the details of final return, which requires to be filed by taxable person whose registration has been cancelled or surrendered within 3 months of the date of cancellation or surrender whichever is later.

12. GSTR 11

This form gives you the details of inward supplies that must be provided by a person who has Unique Identification Number (UIN). This form has to be filed by 28th of the month following the month for which statement is filed.

In order to file GST Returns, there’s a need of GST complaint sales and purchase invoices. You can contact a consultant to help you in generating GST complaint invoices with ease.