The Role A CA Plays At The End Of The Financial Year In India

The financial year in India is from the 1st of April to 31st March every year. Hence, 31st march or say the end of a financial year is an important time for every business owner, employee, and every other person who has financial obligations to fulfill.

A Chartered Accountant(CA) plays a vital role at the end of every financial year.
Every time a financial year ends, there are several major responsibilities related to finance and taxation that every person needs to fulfill.

To fulfill those, a Chartered accountant helps people with their financial and tax advisory to improve their financial position, profits and reduce the tax liabilities.

The Role Or Functions A CA Plays At The End Of Every Financial Year Are:

Maintenance and Closing the books of accounts:

A Chartered Accountant keeps a systematic record of all day to day transactions in a systematic manner that occurs in a financial year. As the financial year ends, the main role of a CA is to manage and properly close the books of accounts for that year.

By closing books of accounts, the CA prepares a balance sheet to calculate the net profit and loss and the financial position of an entity for an accounting period.

Performing statutory and internal audit:

At the end of every financial year, a CA performs a statutory and internal audit. Under the statutory audit, he/she audits the books of entities to ensure that entities prepare all financial statements with standards, accounting principles and legal considerations and all statements are true and fair in nature.

On the other hand, Internal audit relates to ensuring that all the accounting transactions and activities are in accordance with the accounting policies.

Ascertain The Profit & Financial Position:

A Chartered Accountant, by auditing and closing the books of accounts, calculates the financial position and net profit of an entity on a specific date. But calculating the net profit and financial position, it becomes easy to calculate and reduce the tax and other financial liabilities. The ascertainment of financial position at the end of every financial year also helps in making financial and investment decisions.

Taxation Services:

Another very important role a Chartered accountant plays at the end of a financial year is providing all major taxation services to their clients. The tax services include-

    • Planning and saving Tax in advance.
    • Filing tax and tax returns.
    • Prepare representations for tax authorities.
    • Maintenance of tax records.
    • Providing consultancy on tax and financial matters.
    • Investment planning to reduce tax liabilities.

With these services, a Chartered Accountant helps its clients in managing and reducing the tax liabilities and increasing net profit in hand.

Facilitate Decision Making:

At the end of every financial year, there are tons of decisions to be made related to growth, market, sales, production, finances, taxes and so on.

When it comes to the money part where cost, profit, margins, taxes, liabilities play a major role; the decision making or say “correct financial decision making” becomes very important.

A Chartered Accountant, through his/her experience in finance, economy, accounts and other important fields facilitates and helps their clients in proper decision making.

Budgeting:

At the end of every financial year, the Chartered accountants have the main task of preparing budgets. According to the resulting financial position, the profit earned in the year, and the expenses; CA prepares a budget for the upcoming year.

A budget is used to prepare to compare the actual results with expected and find variations if any. The role of CA is very important in budgeting.
A Chartered Accountant is the most important support for any business and taxpayer during and at the end of every financial year.

Everything you must know about Income Tax Consultancy

Income tax act was passed in 1961. Income tax is a term that includes taxes any taxpayer pays to the government, on income received. Whether you are a newbie or an old-hand taxpayer, question yourself, have you ever thought about saving tax on income? or Is your tax planning proper enough to save maximum tax on your income?

Often attributed to Ben Franklin is this famous quote: “Nothing is certain except for death and taxes.”

Paying taxes is necessary, but the hard part is its management. Managing taxes, in a legal format, without breaking any rules seems near to impossible.

Tax laws governed by the income tax department are very complex and so is filing and managing your taxes, but saving tax or planning your taxes, actually, is very easy with the help of proper income tax consultancy services.

As a part of chartered accounting services, tax consultancy services are provided by experienced chartered accountants, who professionally guide and help you with your taxes.

Tax consultants provide a number of quality tax services, which help you in planning, managing, and save tax on your income.

How does Tax Consultants help you?

A general perception of chartered accountants and tax consultants is that they just file income tax and prepare accounting records for businesses. In reality, they do more than just record-keeping and tax filing, here are in how many ways income tax consultants help you with your finances.

Tax planning & savings:

Tax consultants plan and help you save a lot from your taxes. There are several legal methods through which these professionals manage and plan your taxes beforehand, increase your savings, and keep your income under low tax slabs.

Tax refunds and computations:

Before the filing of income tax, hiring income tax consultants can be financially beneficial. Professional advisors compute actual taxes based on your income, and with experience in finances, calculate maximum refunds and lower your tax liability and save a lot from your income.

Filing of income tax:

While filing income tax for you, tax consultants make sure no mistakes occur, and all information is correct and is filled in their respective fields. These professionals help you with the proper filing of income tax.

Investment planning:

Whether you are a businessman or an employee, these chartered accountant professionals work on their toes and help you with planning investments, reducing maximum risks possible, that guarantee you big returns and long financial stability.

Consultancy on tax and financial matters:

Tax laws are confusing and hard to understand for a common person. Income tax consultants provide specialized consultancy on tax and financial matters, based on several legal and moral factors. By hiring a tax consultant, you can easily get solutions to all your tax and financial matters.

Maintenance of Income Tax records:

Filing of tax and refunds are important and to be done properly, but proper record maintenance of taxes, keeping in mind all rules, prohibitions, acts, heads of income, deductions, penalties, is not an easy task. Hiring a professional income tax consultant, for maintenance of income tax records not only keeps your tax practices short and smooth, but will also save your time, money, and reduce your liabilities too.

Benefits of Income Tax Consultancy.

Apart from the above tasks, tax consultants benefit their clients by

  • Saving a lot of time in preparing returns
  • Updating clients about tax laws and practices
  • Communicating and explaining all tax issues on time
  • Planning for taxes beforehand
  • Handle complex calculations
  • Prepare all documents and records properly
  • Frequent research and analysis of tax legislation
  • Continuous meetings for updates
  • Keeping compliant with tax obligations
  • Working with profit arrangements

Reasons why you should hire tax consultant/advisor.

  • To maximize your tax deductions and credits
  • Transferring your total income from a high tax slab range to a lower tax slab range
  • Defer most of the taxes to future financial years
  • Taking advantage of the current economy-boosting tax laws
  • Managing profits and losses made on capital assets to balance each other

Skills and qualifications income tax consultants have.

As a professional, tax advisors/consultants carry some very important and demanded skills and qualifications. Some of their professional skills are

  • Updated knowledge about changes in tax laws
  • Expertise in accountancy and finance
  • Experience in handling economic, law, financial and management issues
  • Good with numbers
  • Logical and analytical mindset
  • Excellent communication and interpersonal skills
  • Good influential and negotiation skills
  • Dynamic organizing and planning skills
  • Solve problems with accurate solutions
  • Proper time management
  • High ability to work under tight deadlines
  • Attention to every detail needed
  • Flexibility in approach towards tasks
  • Confidentiality in work, for clients comfort
  • Better commercial understanding
  • Systematized record maintenance.

Income tax advisors have expert knowledge in areas like corporate tax, inheritance tax, trusts and estates, VAT, TDS, TCS, personal tax, national insurance, and many more.

Whether you are an employee or own a business, income tax consultancy is beneficial for both.

7 Tax Saving Tips for Salaried Individuals

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.

  1. 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.

  1. 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.

  1. 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.

  1. 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.

  1. 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.

  1. 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.

A Complete Guide to GST Registration

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.