Section 44AA Compulsory maintenance of accounts

Compulsory maintenance of accounts Provision regarding maintaining of books of accounts shall be given below: Every person carrying on business and profession (other than profession mentioned in sub-section (1) shall maintain books of accounts if the following condition is satisfied Case 1– If Income from business and profession exceeds one lakh fifty thousand in all three …

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Method of Accounting Types, Section 43B Deduction on Actual payment. Section 43CA

Method of Accounting Computation of Income and Expenses under the Profit and Gain of Business or Profession comes under Method of Accounting. There are two types of Method of accounting. Cash system of accounting. Mercantile system of accounting What ever system of accounting office adopted should be adopted regularly and any changes shall be allowed …

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Deductibility in respect of Gratuity Fund Section 40A(7), Employers contribution Section 40A(9), Income under Section 41.

Contents1  Provision for Gratuity Fund deduction under Section 40A(7)2 Employer’s contribution towards fund Section 40A(9)3 Income under section 414 Actual Cost of Depreciable Assets Sec.43(1)4.1 Interest on assets4.2 Building in personal use subsequently used in Business/Profession  Provision for Gratuity Fund deduction under Section 40A(7) As per Income Tax no provision is allowed for deduction in …

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Payment to Relative/Related Person SEction 40A(2), Payment in Excess of 10,000 SEction 40A(3) Rule 6DD

Contents1 Section 40A(2) Payment Relative2 Section 40A(3) Rule 6DD2.1 Exception under rule 6DD Section 40A(2) Payment Relative Any excessive and unreasonable payment and expenditure made by the assessee to any relative (person mentioned below) and such payment made is excessive or unreasonable having regard to the fair market value of goods, services or any facilities, …

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Agriculture Extension Project Section 35CCC Rule 6AAD/ Rule 6AAE, 35CCD, 35D, 35DDA

Contents1 Expenditure on Agriculture Extension Project Section 35CCC Rule 6AAD/Rule 6AAE2 Expenditure on skill development project 35CCD3 Amortization of  certain Preliminary Expenses Section 35D3.1 Cost of Project and Capital Employed4 Amortization of Expenditure under Voluntary Retirement Scheme Section 35DDA Expenditure on Agriculture Extension Project Section 35CCC Rule 6AAD/Rule 6AAE If any assessee has incurred any …

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Expenditure on Scientific Research Section 35, section 35(2AB), Section 41(3)

Contents1 Scientific Research  Expenditure before commencement of Business2 Donation/Contribution to reseach Association3 Deduction allowed under section 354 Sale of assets used for scientific research5 Transfer of asset to the normal business.6 Tax treatment on sale of Plant and Machinery Section 41(3) If any person has done any scientific Expenditure revenue or capital relating to business, …

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Depreciation Section 32, Additional Depreciation, Special deduction Section 32AD

Contents1 What is Depreciation?2 Computation of Depreciation2.1 Depreciation on the basis of Block of Assets3 Additional Depreciation Section 323.1 Exception of Additional Depreciation4 Special Deduction Section 32AD What is Depreciation? As per Income Tax Act Depreciation is Reduction in Carrying value of Intangible or Tangible Assets over a period of time. Depreciation is non-cash expenditure …

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Income chargeable to Tax under the Head Business/Profession Section 28

Business and Profession income defines those income which has been occurred day day activity of business and is related to  general practice of accountancy but income and expenditure shall be such as are given under Income Tax Act. However there are certain income shall be taxable under the head Business/Profession. Income from Speculation Business :-Speculation …

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Tax liability in respect of arrears of Rent Section 25A, Section 56, Section 26, Section 22/27

Contents1 Tax liability in respect of arrears of Rent Section 25A2 Sub-letting of House Property Section 563 Owner /Deemed Owner Section 22/Section 273.1 Transfer of a house property to spouse:-3.2 Person in Possession of a property:-3.3 Member of a co-operative society etc:-3.4 Holder of an important estate:-3.5 Section 22 for House property situated in foreign …

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