June 2017 - Gapeseed Consulting

ONLINE INCOME TAX RETUN

Income Tax Return is defined under Section 139(1) of the Income Tax Act, where an Income Tax Return is required to be submitted by every Individual where his income exceeds the minimum income chargeable to Income Tax.

E-filing or electronic filing is submitting your income tax returns online, using tax preparation software that has been pre-approved by the relevant tax authority.

WHO IS REQUIRED TO FILE INCOME TAX RETURN?

An individual, if gross total income (before allowing any deductions under section 80C to 80U) exceeds Rs 2,50,000/-.
There is a limit ofRs 3,00,000 for senior citizens ( who are more than 60 years old but less than 80 years old) or Rs 5,00,000 for super senior citizens (who are more than 80 years old).
A company irrespective of whether there is any income or loss or NILincome during the financial year, it is mandatory to file income tax return.
A firm irrespective of whether there is any income or loss or NIL income during the financial year, it is mandatory to file income tax return.
E-filing of Income Tax return is compulsory if you want to claim income tax refund.
If one wants to carry forward loss under any head of income, it is mandatory to file IT Return.
Return filing is mandatory if you are a Resident individual and have an asset or financial interest in an entity located outside of India.
One is required to file an income tax return when you are in receipt of income derived from property held under a trust for charitable or religious purposes or a political party or a research association, news agency, educational or medical institution, trade union, a not for profit university or educational institution, a hospital, infrastructure debt fund, any authority, body or trust.
If tax has been deducted from your income, then you must file income tax return to avoid notice from the income tax department as it has information about your income.

PROCESS OF FILING INCOME-TAX RETURN

For any queries and any FAQs while filing Income tax return please feel free to contact Gapeseed Consulting Pvt. Ltd.

www.gapeseedconsulting.com

TYPES OF FORMS FOR DIFFERENT ASSESSEES

FORM	SOURCE OF INCOME	DUE DATES FOR FILING
ITR-1(SAHAJ)	· INCOME FROM SALARY · OTHER INCOME SUCH AS INTEREST · INCOME FROM ONE HOUSE PROPERTY	· 31^ST JULY
ITR-2 FOR INDIVIDUALS AND HUFs	· INCOME FROM SALARY · OTHER INCOME SUCH AS INTEREST · INCOME FROM ONE HOUSE PROPERTY · INCOME FROME CAPITAL GAINS · INCOME FROM BUSINESS OR PROFESSION FOR HUFs, INDIVIDUALS AND PARTNERSHIPS	· 31^ST JULY
ITR-3 FOR INDIVIDUALS AND HUFs	· INCOME FROM BUSINESS	· 31^ST JULY
ITR-4 (SUGAM)	· INCOME FROM SALARY/PENSION · BUSINESS INCOME WHERE INCOME COMPUTED ON PRESUMPTIVE INCOME BASIS · INCOME FROM NOT MORE THAN ONE HOUSE PROPERTY · INCOME FROM OTHER SOURCES	· 31^ST JULY
ITR-6	· INCOME OF COMPANIES	· 30^TH SEPTEMBER
ITR-7	· INCOME OF CHARITABLE AND RELIGIOUS INSTITUTE · INCOME OF POLITICAL PARTY · PERSONS CLAIMING EXEMPTIONS UNDER SECTION 10. · INCOME OF UNIVERSITY, COLLEGE OR INSTITUTION.	· 30^TH SEPTEMBER

CONSEQUENCES OF NON-FILING OF RETURNS

Filing of Income Tax Returns helps an Individual to establish a standard proof of Income with the Income tax department. But there are certain consequences of Non-filing: –

Losses of business or profession and capital loss cannot be carried forward in the next year if one fails to file an income tax return for the same year.
Due to Non filing of return the assessee has to bear a penalty of Rs. 5000.
The Assessee will also be liable to charge Interest @ 1% for non-filing of return.
Company assesses are liable to prosecution as well in case of non-disclosure of income and non-filing of Income tax return.

All about Goods and services tax

What is GST?

The RajyaSabha has cleared a constitutional amendment to bring out a system of Goods and Services Tax (GST) in India. It is perhaps the most important economic reform on the NarendraModi government’s agenda. This is one reform which affects all of us.

Goods & Services Tax is a complicated, comprehensive, multi-stage, destination-based tax that will be levied on every value addition. Goods and Services Tax will be levied on all transactions happening during the entire manufacturing chain.
Earlier, when a product was manufactured, there would be an Excise Duty on the manufacture, and then the state would add a VAT tax when the item is sold to the next stage in the cycle. Then there would be a VAT at the next point of sale. The process has changed in the GST regime. Now, Goods and Services Tax will be levied at every point of sale.

Importance of GST

GST plays a significant role in redefining the current tax structure and thus the economy. Currently, the Indian tax structure is divided into Direct and Indirect Taxes. Direct Taxes are levied where the liability cannot be passed on to someone else. In the case of Indirect Taxes, the liability of the tax can be passed on. One can explain the impact of cascading taxes with an example. For example X sells goods to Y after charging sales tax, and then Y re-sells those goods to Z after charging the same tax. In this case while Y was computing its sales tax liability, it also included the sales tax paid on previous purchase, which is how it becomes a tax on tax. This is also referred to as taxes on taxes. This is where the need for GST arises to do away with the phenomenon.
Once the new regime is implemented, harassment of businesses by different authorities will end, and India will have one rate for one commodity throughout the country.

Four GST bills

With clear road map laid down by the Finance Ministry, the Government seems on course to fast track the entire process to achieve targeted GST implementation effective 1 July 2017.
On 12 April 2017, the Central Government enacted four GST Bills.
 Integrated GST (IGST)
 Bill to Compensate States
 Central GST (CGST)
 Union Territory GST (UTGST)

Indirect taxes that will be included under GST –

State taxes
 VAT/Sales Tax
 Entertainment Tax (unless it is levied by local bodies)
 Luxury Tax
 Taxes on lottery, betting and gambling.
 State Cess and surcharges in so far as they relate to supply of goods and services.
 Entry tax not on in lieu of Octroi.

Central Taxes
 Central Excise Duty.
 Additional Excise Duty.
 The Excise Duty levied under the medical and Toiletries Preparation Act
 Service Tax.
 Additional Customs Duty, commonly known as countervailing Duty (CVD)
 Special Additional duty of customs
 Surcharges
The above taxes dissolve under GST; instead all of these, only CGST & SGST exist.

Impact of GST on different Industries

Food Industry
The sales even under the GST regime would largely remain exempt due to small business registration threshold. Food has an exemption from CENVAT and 4% VAT, the GST under a single rate would lead to doubling of the tax burden on food.

Financial Services
India has followed the approach of bringing virtually all financial services within the ambit of tax where the consideration is in the form of an explicit fee. In most of the countries GST is not charged on Financialservices.

Pharma Industry
This sector generally has an inverted duty structure i.e. excise duty on raw material is around 12.5% whereas on finished goods it is around 6-7%, which thus leads to accumulation of refund dues from government. With GST, the Pharma sector is hopeful of making refund process fast and simple, this coupled with savings in warehousing and logistics cost may thus anticipate a positive impact.

Transportation Industry
The Road Transport and Highway ministry is considering an overhaul of around 80 border check posts across the country to ensure seamless flow of goods under the GST regime. Thus, it would be very beneficial for the transportation industry with higher moving time of wheels and lower transit time which will certainly boost the business, reduce inventory holding requirements, transportations cost and better utilization of assets.

Real Estate Industry
Sale or transfer of immovable property is outside the purview of GST, however, on procurement of materials for civil construction GST will be applicable and ITC of the same wouldn’t be admissible. This may impact negatively. Hopefully, this issue will be addressed appropriately while declaring the final law.

FMCG Sector
FMCG has seen a consistent growth in the past three – four years.When the GST will be passed and on the opening of FDI, the consumer will have a positive impact on this sector. At the same time, FMCG companies will save on logistics costs.

For more information on Goods and services tax, feel free to reach us on, info@gapeseedconsulting.com or call +91-9599444639/+91-9599444630

Read More:

Excerpts from GST Council’s 8th Meeting

GST Registration Procedure

AUDIT REQUIREMENT FOR LLP IN INDIA

What is an LLP?

LLP is a way between Company and Partnership. It takes the benefits of both i.e. less legal and regulatory formalities and a Corporate Entity form.Professionals who use LLPs tend to rely heavily on reputation. Most of them are managed by professionals who have a lot of experience and clients. By pooling their resources, the partners tend to lower the costs of doing business while increasing the LLP’s capacity for growth. They can share office space, employees and so on. Reducing costs allows the partners to realise more profits from their activities than they could individually. The partners in an LLP can also be junior paid partners with future probability of turning into normal partners. These junior partners are paid a salary and often have no stake or liability in the partnership. They are designated professionals qualified to do the work that the partners bring in. This is another way that LLPs help the partners scale their operations. Junior partners and employees take away the detailed work and free up the partners to focus on bringing in new business.LLP can be more profitable since it has the ability to bring partners in and let partners out. Because a partnership agreement exists for an LLP, partners can be added or retired as outlined by the agreement. This comes in handy as the LLP can always add partners who bring existing business with them. Usually, the decision to add requires approval from all the existing partners.

Maintenance and filing of Accounts

An LLP shall be under obligation to maintain annual accounts reflecting true and fair view of its state of affairs. A “Statement of Accounts and Solvency” in prescribed form shall be filed by every LLP with the Registrar every year.

Exemption from Audit

The accounts of every LLP shall be audited in accordance with Rule 24 of LLP, Rules 2009.

Such rules, inter-alia, provides that any LLP, whose turnover does not exceed, in any financial year, forty lakh rupees, or whose contribution does not exceed twenty five lakh rupees, is not required to get its accounts audited. However, if the partners of such limited liability partnership decide to get the accounts of such LLP audited, the accounts shall be audited only in accordance with such rule.LLPs have to appoint auditor within 30 days before the end of the financial year. In other words auditor has to be appointed before 1st March every year.

Appointment by designated Partners

The designated partners may appoint an auditor:

At any time for the first financial year but before the end of the Financial Year.
Within 30 days before the end of the Financial Year.

This can be done to

To fill a casual vacancy in the office of auditor.
To fill up the vacancy caused by removal of an auditor.

Appointment by Partners

If the designated partners have not appointed then the Partners can assume this responsibility.

Holding Office

An Auditor shall hold office from the day the previous auditor ceases to hold office and upto the end of the next period for appointing a new auditor, unless re-appointed.

Penalty

Any LLP which fails to comply with the requirements shall be punishable with a fine which shall not be less than Rs. 25,000 but not exceeding Rs. 5,00,000. Every designated partner shall be punishable with fine which shall not be less than Rs. 10,000 but not exceeding Rs. 5,00,000.

Annual Returns

Every LLP would be required to file annual return in Form 11 with ROC within 60 days of closer of financial year. The annual return will be available for public inspection on payment of prescribed fees to Registrar.

Documents available for public inspection in the office of Registrar

The following documents/information will be available for inspection by any person:-

Incorporation document,
Names of partners and changes, if any, made therein,
Statement of Account and Solvency
Annual Return

The fees for such inspection of an LLP is Rs 50/- and fees for certified copy or extract of any document u/s 36 shall Rs. 5/- per page.

For more information, feel free to reach us on, info@gapeseedconsulting.com or call +91-9599444639/+91-9599444630

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