Different types of income attract different tax treatment types and compliance with INCOME TAX through income tax filings as tax returns within due dates.
Our TaxCare services help individuals and non-individuals file their appropriate income tax return by following the process of financial and investment planning.
Income tax is levied after crossing a specific limit of income earned as SALARY, PROFESSION, BUSINESS etc. An income tax return is a form of reporting such income and paying taxes by income tax filings.
Income tax rates and systems of compliance depends on the type of taxpayers such as (INDIVIDUAL, NON INDIVIDUAL and NRI)
GST is a comprehensive tax that is levied on the supply of goods and services. It has overcome the value addition at each station of state and central level's indirect taxes and complying with many departments.
Obtaining GST registration becomes mandatory after a specific limit of turnover of the business.
INCOME TAX: It is a direct tax levied by the Government of India on the income of every person. The provisions governing the Income-tax are covered in the Income-tax Act, 1961.
PERSON: The term 'person' includes Individual, Hindu Undivided Families [HUFs], Association of Persons [AOPs], Body of individuals [BOIs], Firms, LLPs, Companies, Local authority and any artificial juridical person not covered under any of the above.
INCOME: Under the Income-tax Law, the word 'income' has a comprehensive and inclusive meaning. In the case of a salaried person, all that is received from an employer in cash, kind or as a facility is considered as an income. For businessmen, his net profit will constitute his income. Income may also flow from investments in the form of Interest, Dividend, Commission, etc. Further, income may be earned on the sale of capital assets like building, gold, etc.
Income shall be computed as per relevant provision of Income-tax Act, 1961, which lays down detailed condition for computation of income chargeable to tax under various heads of income mentined in income tax return forms.
Various sections for tax computation and tax savings, frequent updates in the filing portal, due dates, tax rates, related background preparation, software application etc., of appropriate tax compliance may seem out of understanding for taxpayers.
Our TaxCare team is readily available on higher at a very reasonable cost with a comprehensive service portfolio of filing returns and with an offer of various attractive tax saving schemes.
Feel free to contact us.
Being a citizen of the country, Filing an income tax return with payment of applicable tax is the duty, and that earns the dignity of consciously contributing to the nation's development.
Holding an asset that is escaped from filing in an income tax returns to save tax may cause fear from utilising such assets for business expansion. If the department notices utilisation of such help, it may be subject to an action resulting in massive penalties.
Reporting assets and liabilities honestly strengthen the financial power and gives a wave of peace of mind.
Your income tax return validates your creditworthiness before financial institutions and makes it possible for you to access many economic benefits such as bank credits, etc.
Income tax filings proof is also required for availing an Insurance of higher sum assured under a process financial and investment planning process.
Income tax returns is a supporting document for applying visa to travel abroad. Some counties had made it mandatory to an enclosure with the visa application.
An income tax return is valid income proof for individual and non-individuals. In some specific, Govt. scheme distribution, Income tax returns are considered income proof to offer in the hand of the actual beneficiary of the schemes.
Income tax returns are filed annually with payment of due tax following a FINANCIAL YEAR (FY) and ASSESSMENT YEAR (AY) cycle, which begins from 1st April to 31st March of the succeeding year of an English calendar.
FINANCIAL YEAR (FY): It refers to the year during which the income is earned. It begins from 1st April of the current year to 31st March of the succeeding year of an English calendar, e.g., FY 2020-2021, from 01/04/2020 to 31/03/2021.
ASSESSMENT YEAR (AY): It refers to the year in which the earned income is assessed, and the due income tax return is filed with payment of applicable tax. It is also beginning from 1st April of seceding year to 31st March of the next succeeding year of an English calendar, e.g., for FY 2020-2021, the AY will be 01/04/2021 to 31/03/2022.
Our TaxCare team is available to help the taxpayer at a very reasonable cost for the help of filing appropriate income tax returns and other income tax matters.
ADVANCE TAX: It is to be calculated based on the expected tax liability of the year. Advance tax is to be paid in instalments as given below:
Note: Any tax paid on or before the 31st day of March shall also be treated as advance tax paid during the same financial year.
The advance tax deposit will be adjusted with final INCOME TAX RETURNS.
TAX DEDUCTED AT SOURCE (TDS): Deduction of tax at source applied to several payments such as salary, interest, commission, brokerage, professional fees, royalty, contract payments, etc. The amount deducted by the employer/payer should be deposited to the department in the account of the employee/recipient.
TDS payment is also considered advance tax payment and can be adjusted with final INCOME TAX RETURNS.
FINAL PAYMENTS: An taxpayers reach to final payment of income tax after preparing a complete set of returns with the last background that considers various financial statements and deductions of section allowed under Income tax law. It also includes interest on unpaid advance as per schedule.
Our TaxCare team is available to help the taxpayer at a very reasonable cost for computing and depositing advance tax and appropriate final returns with maximum tax savings.
The term 'person' of income tax includes various categories of the assessee, e.g. INDIVIDUAL, SENIOR CITIZEN, HUF, NRI, COMPANY, TRUST, etc. Therefore, an income earned by different categories of the assessee from the same or different types of business may be treated differently by the Income-tax laws.
Income earned by an assessee from different types of business activity attracts identical tax treatment for TAX SLABE, and the RATE OF TAX vary at a different level of income of the taxpayer.
EXEMPTIONS: Income tax law allows some exemptions to the taxpayers in the account of various business activities and types of residents statute that are excluded from taxable income.
Here are looks for some.
DEDUCTIONS: Income tax law also allows some deductions to the taxpayers in the account of various allowances and expenditures that are excluded from taxable income.
Here are looks for some.
An appropriate ITR considers all the aspects of the taxpayers; our TaxCare team gathers information from the taxpayer even at a brief meeting or over a telephone counselling to arrive to prepare a background of computation.
Feel free to contact us to file your ITR.
Various sections of Income-tax law allow exemptions from taxpayers' taxable income if invested in specific schemes such as ELSS Investments, Insurance, Home loan Interest & principal etc., to INDIVIDUALS, which minimizes tax liability and enhances the household savings. Following financial and investment planning can be better efficient.
Some separate exemptions and deductions apply to the business expenses such as Insurance, subscription Social security schemes for employees, advertisement & marketing costs, etc. which are incurred in the operation of business activities. Such types of exemptions are moral support and encourage business entrepreneurs.
Income tax Section 80c and 80ccd allow exemption on savings up to Rs. 150000 ( One lakh fifty thousand) and Rs. 50000 (fifty thousand) if invested in specific schemes such as NPS, NSC, KVP, ELSS, INSURANCE etc.
LIFE INSURANCE: Insurance premium paid for life insurance is considers under Section 80c.
HEALTH INSURANCE: Section 80D allows exemptions for the premium paid as health insurance for self and family up to Rs. 25000/- (50000 for senior citizen) and for parents 50000/- PA.
Income tax sections from 30 to 37 allow exemptions/deductions for the actual amount of expenditure allowed under section. It also includes subscription of group schemes for the employees' social security, Insurance for stocks, building, group, keymen, liability, etc.
Various funds received as maturity, claim settlement, surrender, moneyback, interest, premature claim etc., are treated differently in tax. Some of those recipes are taxed, and some of them are not, depending on the types of claim and recipient (Individual/nonindividual)
There is separate capital gain tax treatment on the selling of physical and financial assets.
PHYSICAL ASSETS: 20% Capital gain tax is levied on the profit earned by selling a physical asset after deducting the expenditure incurred in DEVELOPMENT, PROTECTION, SELLING, etc., and the INDEXATION value of the property.
FINANCIAL ASSETS: Selling of financial securities attract a Capital gain tax of 10% above gain over 1 lakh if the holding period exceeds one year and liquidating within a year treated as short term capital gain and treated as per income tax slab at per individual.
A summary below is stating the differences.
Income tax is a broader matter with various types of tax treatment in terms of 'PERSON' for levying the TAX SLABE, RATE, EXEMPTION, DEDUCTION, MODE OF PAYMENT, sources of income such as AGRICULTURE, BUSINESS, SALARY, PROFESSION. etc.
On the other hand, an ongoing or pending process of compliance, litigation, etc.
Therefore we strongly recommend consulting with an expert for arriving at an appropriate tax solution.
Our team is always in support.
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