Tag: Internal Audits for Growing Companies

Save Tax through the following Tax Exemptions

Did you know that it is possible to save your income tax out flow by far a large amount?

Do you want to know about Tax Planning through Tax Exemptions?

Did you know that we can help you with this year’s Tax Filing? Are you wondering about redeeming some of the previous year’s tax which you filed and weren’t aware of exemptions.

Then this is the post for you. Read further to understand how you can save tax through following tax exemptions. All this is possible legally under the Indian Income Tax Act which allows certain deductions which can be claimed to save tax at the time of filing of Income Tax Return by all classes of taxpayers . All you need to do is a proper tax planning which would allow certain deductions from your gross total income and income tax would be levied on the balance income as per the income tax slabs. Here are certain year-end tax tips to get smarter with tax management.

  • House Rent Allowance (HRA): It is the best tax saving tool which a taxpayer can use. Under this you can save upto 50% of your salary if you are staying in a metropolitan city like Mumbai, Delhi, Chennai or Kolkata else 40% if you reside in non-metro. Apart from this if actual rent paid is lower than 10% of your basic salary received then there is no exemption. Be aware that you cannot claim any exemption under this section if you love in your own home or of you are not paying rent to anyone.
  • Medical Reimbursement: If your employers provide you medical reimbursement facility for your medical expenses you can get tax exemption. No income tax on medical reimbursement is levied up to Rs. 15000 provided all bills for the same are produced by the employee to the employee. This also includes premiums that your company might be paying for your health insurance schemes and on treatments of any critical diseases. It is to be noted that no income tax on medical reimbursement is levied upto Rs. 15000, the amount received as medical allowance would be fully taxable.
  • Deductions on Section 80C, 80CCC: Under Section 80C a deduction of Rs.1,50,000 can be claimed from the total income you earn. In simple terms you can save up to Rs. 1,50,000 from your total taxable income under this section. Please note this deduction is allowed to an individual or a HUF. Under Section 80CCC it provides deduction to an Individual for any amount paid or deposited in any annuity plan of LIC or any other insurer. The plan must be for receiving pension from a fund referred to in Section 10(23AAB).
  • Leave Travel Allowance (LTA): It is the most common element of compensation which the employers use to remunerate employees due to the tax benefits attached to it. An LTA is the remuneration paid by an employer for Employee’s travel in the country, when s/he is on leave with the family or alone. LTA amount is tax free. Section 10(5) of the Income-Tax Act, 1961, read with Rule 2B, provides for the exemption and outlines the conditions subject to which LTA is exempt. Please note that The total cost of the holidays is not covered, only the travelling cost is covered.
  • Spend more: Increasing expenses, such as paying off bills or other debts or paying out bonuses to employees, it will help increase your deduction for the current year. If you’ve delayed major purchases for your business, you should go ahead and buy it. Not only can you find great deals as businesses try to clear out inventory, you’ll have more deductions. In general capital improvements and new equipment should be capitalized and depreciated over 5, 7 or 10 year period.To know more about tax planning, tax exemptions and to get smarter with tax management for this financial year, drop us a line here and we will be happy to provide you our Tax planning services .  You can also write us at info@gapeseedconsulting.com  or, call us for Tax Advice at, +91-9599444639.

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The Evolving Role of Internal Audit in Growing Companies

Without any doubts, today’s organizations face a global economic crisis of historical proportions. In response to that, management, board of directors and leaders throughout the organization are taking fresh look at virtually all aspects of the business to assess how to enhance productivity, processes and systems, yet still stay “in control.” They are starting, and very likely will continue, to think and respond differently as they determine how to operate their businesses successfully and maintain plans for long-term growth in today’s unique business environment.

As the mandate and role of internal audit continue to evolve, managements are increasingly counting on internal audit functions in their efforts for managing fraud risks and keeping organisations protected. Increasingly, the internal audit function is not to monitor and detect but also to investigate fraud incidences when they arise. The role of internal audit in fraud risk management by way of preventing, detecting and investigating fraud has amplified as a result of economic uncertainty and increased focus of certain organisation’s management on fraud risks.

Internal auditors traditionally look beyond financial risks and statements to consider wider issues such as the organisation’s reputation, growth, impact on the environment etc. The fundamental function of an internal audit team are Assurance, Assessment and Recommendations, Oversight, Advisory Services.

The changing role of Internal Audit

Internal auditing professionals not only must understand these challenges and their organization’s key objectives, but also ensure that amid the many organization wide changes taking place on almost a daily basis, key controls and processes are adequately addressing these changes and the new risks that emerge, and are functioning as intended. Internal audit plays a critical role in helping companies successfully “manage the change” by providing assurances that with every new process, procedure and initiative, any significant new risks that emerge are identified, monitored and managed effectively, so that the enterprise is protected on an on-going basis and to a level that satisfies management and the board.

An effective audit planning process that focuses on organisational strategic imperatives and key business risks will identify an appropriate blend of advisory and assurance reviews. The updating of the audit plan can no longer be an annual process. The audit plan must be refreshed regularly (e.g., quarterly) and with triggering events. Leading functions are developing a ‘3 + 9’ plan — a three month frozen window and nine month fluid plan. For those that do not, the risk of unpreparedness, of being too slow to react to the changing risk environment or market events is simply too great, leaving organisations perplexed to react to events, some of which include:

  • Transactions (mergers, acquisitions, carve-outs or divestiture)
  • New product launch or retirement
  • New market entry
  • Patent expiry
  • Litigation

Mandate for Internal Audit

    • Strategic and valued advisor:The Internal Audit function serves as a subject-matter resource to business management around strategic initiatives, challenges and changes in the organisation. The function has the people, knowledge and experiences to effectively provide this level of service.
    • Business insight: In addition to covering the ‘basics,’ the Internal Audit function is designed to provide high-quality, relevant business insight as an integral part of its activities. Business insight is not a by-product, but an explicit outcome from the function’s activities.
    • Control and compliance monitoring structure:Internal Audit functions should be focused on evaluating the design and the effectiveness of internal controls in the areas outlined, in their charter or mandate. This also includes focusing on compliance with key regulations and policies.

Also, internal audit must think expansively when seeking ways to add value to the organization. Too often, we find internal audit functions stop short of making recommendations that could create value for the organization for fear of overstepping their place. However, “consulting” is part of the Institute of Internal Auditors’ definition of internal auditing, and we believe that appropriately empowering this function provides management with greater opportunities to create value without compromising independence.

At Gapeseed Consulting we work with your organization, virtually of any size to assist you with your internal audit activities. We believe the Internal Audits are now required to find different ways to increase shareholder value and increase the attractiveness of the company to investors, senior executives, especially the risk officers and advisors on board.

Internal Audits are required for all set of businesses which are emerging as progressive business units, our Internal auditors partner and build relationships with the client business in order to keep a finger on the pulse of the organization and thereby act as your growth partners.

To know more about our Internal Auditing services click here or get in touch with our team at, ranu@gapeseedconsulting.com

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