Posts By Accstra
Income From Other Sources
- Basis of Charge
- Deductions
- Expenses not Deductible
Section 56
Income chargeable to tax under the head “Income from other sources” shall include following:
- Dividends
- Income by way of winnings from lotteries, crossword puzzles, races including horse races, card games, gambling or betting of any form or nature whatsoever
- Any sum received by an employer from his employees as contribution towards PF/ESI/ Superannuation Fund etc., if same is not deposited in the relevant fund and it is not taxable under the head ‘Profits and Gains from Business or Profession’
- Interest on securities, if not taxable under the head ‘Profits and Gains of Business or Profession’
- Income from machinery, plant or furniture belonging to taxpayer and let on hire, if income is not chargeable to tax under the head ‘Profits and Gains of Business or Profession’
- Composite rental income from letting of plant, machinery or furniture with buildings, where such letting is inseparable and such income is not taxable under the head ‘Profits and Gains of Business or Profession
- Any sum received under Keyman Insurance Policy (including bonus), if not taxable under the head ‘Profits and Gains of Business or Profession’ or under the head ‘Salaries’
In the following cases, any sum of money or property received by a person from any person (except from relatives or member of HUF or in given circumstances, see note 1) shall be taxable under the head ‘Income from other sources’:
a) If any sum is received without consideration in excess of Rs. 50,000 during the previous year, the whole amount shall be chargeable to tax;
Though the provisions relating to gift applies in case of every person, but it has been reported that gifts by a resident person to a non-resident are claimed to be non-taxable in India as the income does not accrue or arise in India. To ensure that such gifts made by residents to a non-resident person are subjected to tax in India, the Finance (No. 2) Act, 2019 has inserted a new clause (viii) under Section 9 of the Income-tax Act to provide that any income arising outside India, being money paid without consideration on or after 05-07-2019, by a person resident in India to a non-resident or a foreign company shall be deemed to accrue or arise in India.
b) If an immovable property is received without consideration and the stamp duty value exceeds Rs. 50,000, the stamp duty value of such property shall be chargeable to tax;
c) If immovable property is received for consideration which is less than the stamp duty value of property by higher of following amount the difference is chargeable to tax:
>> the amount of Rs. 50,000
>> the amount equal to 10% of consideration.
d) If movable properties* is received without consideration and the aggregate fair market value of such properties exceeds Rs. 50,000, the whole of aggregate fair market value of such properties shall be chargeable to tax
e) If movable properties is received for consideration which is less than the aggregate fair market value of properties by an amount exceeding Rs. 50,000, the difference between the aggregate fair market value and the consideration is chargeable to tax.
- If shares in a closely held company are received by a firm or another closely held company from any person without consideration or for inadequate consideration, the aggregate fair market value of such shares as reduced by the consideration paid, if any, shall be chargeable to tax.
Note: Nothing would be chargeable to tax if taxable amount doesn’t exceed Rs. 50,000
- If a closely held public company receives any consideration for issue of shares which exceed the fair market value of such shares, the aggregate consideration received for such shares as reduced by its fair market value shall be chargeable to tax.
Note: This provision is not applicable in the following cases:
a) Where the consideration for issue of shares is received by a venture capital undertaking from a venture capital company or venture capital fund or a specified fund.
“Specified fund” means a fund established or incorporated in India in the form of a trust or a company or a LLP or a body corporate which has been granted a certificate of registration by SEBI as a Category I or Category II Alternative Investment Fund (AIF).
b) Where the consideration for issue of shares is received by company from class or classes of person as notified by the Government.
- Any compensation received by a person in connection with the termination of his employment or modification of terms and conditions relating thereto
- Interest received on compensation or enhanced compensation
- Any sum of money received as an advance or otherwise in the course of negotiations for transfer of a capital asset shall be charged to tax under this head, if:
a) Such sum is forfeited; and
b) The negotiations do not result in transfer of such capital asset.
Note : Movable property’ shall include shares, securities, jewelry, archaeological collection, drawings, paintings, sculptures, any work of art or bullion etc.
– Bishal Deb
Accounts Executive
Taxability of Income From House Property
Index :
- Introduction
- Determination of Annual Value
- Deductions under House Property
- Amounts not deductible from Income from House Property
- Property owned by co-owners
- Deemed Ownership
- Composite Rent
Section 22: Charging Section
Rental Income (Annual Value) is taxable under the head Income from House Property if it satisfies the following two conditions:
- There should be House Property
- Assessee should be the owner of the House Property
House Property includes buildings or lands appurtenant thereto
Types of House Property
- LOP : Let out Property
- DLOP : Deemed to be Let out Property
- SOP : Self Occupied Property
Section 23 : Computation of Income from House Property
Municipal Value : It Means Value of Property as per Municipality Record
Fair Rent : It means rent of Similar Property in some Locality ,also known as reasonable rent.
Standard Rent : It means Rent as per the Control Act. It is the maximum amount of rent that can be legally recovered by owner from Tenant.
Actual Rent : Rent Received (+) Rent Receivable (-) unrealized Rent.
Municipal Taxes :
- Tax which is recovered by Local Authority, Municipality, Gram Panchayat
- It is allowed on Payment Basis
- It is allowed only if it is paid by owner
- It is also known as House Tax, Property tax, Local Tax
Concept of Vacancy
1. Expected Rent ≤ Actual Rent + Vacant Rent
In this case take Actual Rent as GAV
2. Expected Rent ≥ Actual Rent + Vacant Rent
In this case take Expected Rent as GAV
Note : Where the property is held as stock-in-trade and the property or any part of the property is not let during the whole or any part of the previous year, the annual value of such property or part of the property shall be taken to be nil for a period of up to two years from the end of the financial year in which the certificate of completion of construction of the property is obtained from the competent authority.
1.Concept of Partly Let out property (Area wise)
If some area of House Property is let out and remaining is self- occupied then Let out portion will be treated as LOP & self – occupied portion will be treated as SOP. Municipal value, Fair rent, Standard rent, Municipal taxes, Interest on loan should be divided between LOP & SOP on area basis.
2.Concept of Partly Let out property (Time wise)
If Property is let out for some period of time and self- occupied for remaining period of time then such property will be treated as LOP only.
Section 24 : Deductions
Interest on Loan
- Interest on loan is allowed as deduction , if loan is taken for the purpose of house property i.e construction, repairs , renovation.
- Loan may be taken from Banks, Financial Institution, friends, family etc.
- Interest is allowed on due basis
- There are limits for Interest on Loan.
Any Fresh Loan is taken for the repayment of earlier loan & earlier loan was taken for the purpose of house property then interest of fresh loan shall be allowed as deduction.
Pre-construction Interest : It means interest paid before the year in which construction was completed. It is allowed in Five equal instalments from the year in which construction was completed.
Section 25 : Disallowance of Interest
Interest paid outside India shall not be allowed as deduction if TDS not Deducted on such Interest
Section 25A : Special Provision for Arrears of Rent and unrealized Rent
Recovery of Arrear/unrealized rent is taxable in the year in which it is recovered , whether the assessee is the owner of the property or not in that financial year.
Taxable Value = Recovery * 70% (30% std deduction)
Unrealized Rent : It means rent which is not recovered by owner from tenant. It is deductible while calculating actual rent if following four conditions are satisfied.
- Tenancy should be bonafide.
- Tenant should have vacated the house property.
- Such tenant should not occupy any other house property of the same assessee.
- Reasonable step should have been taken for Recovery of unrealized Rent.
Arrears of Rent : It means Rent under Dispute
Section 26 : Joint Ownership
Joint Ownership (Co-ownership) means property is owned by more than one owner, in this case Income from House Property is calculated normally & thereafter it should be divided between co-owners in their ownership ratio.
In the above case each co-owner will considered as individual and will be entitled to relief individually.
Section 27 : Deemed Ownership
- If any Individual transfers any house property to his / her spouse without consideration or inadequate consideration then such individual is treated as Deemed owner of such property.
Exception : Transfer in connection to live apart.
- If any Individual transfers any house property to any minor child (other than minor married daughter) without consideration or inadequate consideration then such individual is treated as Deemed owner of such property.
- In case of Co-operative Society, shareholders will be termed as deemed owner of such property.
- Holder of an impartible estate.
Note : If let out property not feasible without other assets then total rent is taxable under the head Income from Business / Profession or Income from Other Sources whether agreement is separable or not.
– Bishal Deb
Accounts Executive
Allowance Under Salary
- Definition of Allowance U/S 10 of Income Tax Act 1961.
- House Rent Allowance — Section 10(13A)
- Prescribed special allowances — Section 10(14)
- Entertainment Allowance – Section 16 (ii)
- Format for Computation of Income from Salary
Allowances are given to employees for their services or as compensation for working in unusual conditions. Section 10 of the Income Tax Act covers many allowances such as Leave Travel Allowance, Uniform Allowance, Travelling Allowance, House Rent Allowance and some more.
It is a regular Extra monetary amount given by employer to employee apart from basic salary.
Money Given for Accommodation ,Medical ,Children & Travelling Etc.
Allowance given to employee to meet his accommodation expenses.
Minimum of the following will be exempted
- Actual HRA received
- Rent Paid – 10% of Salary
- 50% (metro Cities)/40% (others cities) of salary
Salary = Basic salary + DA Conditional+ Fixed Commission(%)
DA conditional= “if under the terms of employment” or “for retirement benefit “or “dearness pay’
Taxable = Actual received – Exempted
Brief Summary of Allowances U/S 10(14), which has been divided in to four category.
- FULLY EXEMPT
- FULLY TAXABLE
- PARTLY TAXABLE
- EXEMPT UP TO CERTAIN LIMIT
- Allowances to a citizen of India, who is a Government employee, rendering services outside India.[Section 10(7)].
- Allowances to High Court judges under section 22A(2) of the High Court Judges(Conditions of Service) Act, 1954.
- Sumptuary allowance given to High Court and the Supreme Court judges. Sumptuary allowance are in the nature of entertainment allowance.
- Allowance received by an employee of United Nations Organization (UNO) from his employer.
- Dearness Allowance (DA)
- City Compensatory Allowance (CCA)
- Fixed Medical Allowance: Fully taxable, irrespective of whether any amount has been spent on medical treatment or not.
- Lunch Allowance/tiffin allowance
- Overtime Allowance 6.Servant Allowance
- Warden Allowance
- Non-practicing Allowance
- Family Allowance
- Deputation Allowance
- Capital Compensatory Allowance
- Project Allowance
- Entertainment Allowance for non-government employee
- Water and Electricity Allowance
- Holiday Trip Allowance
- Marriage Allowance
Special allowances for performance of official duties [section 10(14)(i)]
Taxable = Actual received – Actual paid
- Conveyance Allowance
- Daily Allowance
- Travelling Allowance
- Transfer Allowance
- Helper Allowance
- Academic/Research Allowance
- Uniform Allowance
The above allowances shall be exempt to the extent of minimum of the following:
- Actual Allowance Received.
- Actual amount spent for the purposes of duties of office or employment.
Allowances to meet personal expenses [section 10(14)(ii)]
- Children Education Allowance – Rs.100 pm, Per Child up to 2 Children
- Hostel Expenditure Allowance – Rs.300 pm per child upto 2 children
- Tribal Area, Scheduled / Agency Area Allowance(UP, Karnataka, Tamilnadu , Odisa , Assam & Tripura) – Rs.200 pm
- Hilly Area / High Altitude Allowance – Rs.300 to Rs.7000 pm
- Border / Remote / Disturbed Area Allowance – Rs.200/- to Rs.1300/-pm
- Field Area Allowance(J&K, Nagaland , UP, AP, Sikkim & Manipur) – Rs.2600/-pm
- Modified Field Area Allowance (military duties and where imminence of hostilities/violence and risk exist)–Rs.1000/-pm
- Counter Insurgency Allowance – to Armed force member – Rs.3900/-
- Transport Allowance – Rs.1600/- Pm & Rs.3200/-pm for handicap employee
- Underground Allowance – Rs.800/-pm
- High Altitude (Uncongenial climate) Allowance – armed forces for altitude of 9000 ft to 15000 ft Rs.1060/-pm and for altitude above Rs.1600 pm
- Highly Active Field Area Allowance – Rs.4200/-pm
- Island (duty) Allowance – Rs.3250/-pm
- Allowance to Transport Employees – 70% of Allowance maximum to Rs.10000/-pm.
This deduction is allowed only to a Government employee. Non-Government employees shall not be eligible for any deduction on account of any entertainment allowance received by them.
In case of entertainment allowance, the assessee is not entitled to any exemption but he is entitled to a deduction under section 16(ii) from gross salary. Therefore, the entire entertainment allowance received by any employee is added in computation of the gross salary. The Government employee is, then, entitled to deduction from gross salary under section 16(ii) on account of such entertainment allowance to the extent of minimum of the following 3 limits.
- Actual entertainment allowance received during the previous year.
- 20%of basic salary exclusive of any allowance, benefit or other perquisite.
- ₹5,000.
– Smita Kumari
Account Executive
Perquisites & Salary Deductions
Index :
- Income from Head Salary.
- Definition.
- Valuation and Taxation of Perquisites.
- Deductions under Salary
There is no definition of perquisite as such as per Sec 2 of the Income Tax Act, 1961 however
Sec 17(2) provides inclusive definition of perquisites
As per Sec 17(2) perquisites includes:-
(i) The value of rent-free accommodation provided to the assessee by his employer;
(ii) The value of any concession in the matter of rent respecting any accommodation provided to the assessee by his employer;
- Unfurnished Accommodation
- Furnished Accommodation
(iii) The value of any benefit or amenity granted or provided free of cost or at concessional rate
- To a director of the company
- To an employee who has substantial interest in the company (substantial Interest is 25% equity shares)
- By an employer to employee not covered under (a) or (b) above which is more than Rs. 50,000/-
(iv) Any sum paid by the employer in respect of any obligation which, but for such payment, would have been payable by the assessee.
(v) Any sum payable by the employer, whether directly or through a fund, to effect an assurance on the life of the assessee or to effect a contract for an annuity.
(vi) The value of any specified security or sweat equity shares allotted or transferred, directly or indirectly, by the employer, or former employer, free of cost or at concessional rate to the assessee
(vii) The amount or the aggregate of amounts of any contribution made to the account of the assessee by the employer.
(Viii) The annual accretion by way of interest, dividend or any other amount of similar nature during the previous year to the balance at the credit of the fund or scheme referred to in sub-clause (vii).
(ix) The value of any other fringe benefit or amenity as may be prescribed.
- Motor Car Services
- Services of Sweeper, Gardner, Personal Attendant.
- Supply of Gas, Electricity, Water Charges.
- Free or Concessional Educational Facilities.
- Free or Concessional travel or transport of goods by company engaged in that business
- Interest free or Concessional Loan.
- Value of travelling accommodation touring other than business purposes
- The value of free food and non-alcoholic beverages(apart from payment from vouchers)
- Value of any gift or voucher (more than Rs 5000)
- Membership fee and annual fees incurred by employee(apart from official purpose)
- Value of benefit to the employee resulting in a club re-imbursed by employer(apart from official purposes)
- Value of benefit by transfer of moveable asset
- Value of benefit to employee resulting in using of moveable asset other than computers and laptops(10% per annum cost of the asset)
- The value of any other benefit or amenity, service, right or privilege provided by the employer(cost to employer).
Value of Specified Security or Sweat Equity Shares ;
Value of Specified Security or Sweat Equity Shares is the FMV as on which the shares are exercised by the employee
FMV of shares
- If the shares are listed in Recognized Stock Exchange it is the average price of opening and closing price as on exercise date
- If the shares are listed in multiple stock exchange it would be average price of opening and closing where the stock traded volume traded are high in which stock exchange.
- If there is no trading on the exercise date, the closest date when the stock traded date should be taken.
- If the shares are not listed in Stock Exchange it would be the Fair Market Value as determined by the *Merchant Banker on the exercise date.
Contribution made to the account of the assessee by the Employer ;
The Contribution made by the Employer in excess of Rs 7,50,000 into
- Recognized Provident Fund
- In the scheme referred to in sub-section (1)* of section 80CCD
- In an approved superannuation fund.
Contribution made to the account of the assessee by Supply of Gas, Electricity, Water Charges ;
The value of the benefit to the employee resulting from the supply of gas, electric energy or water for his household consumption shall be determined as the sum equal to the amount paid on that account by the employer to the agency supplying the gas, electric energy or water.
Where such supply is made from resources owned by the employer, without purchasing them from any other outside agency, the value of perquisite would be the manufacturing cost per unit incurred by the employer. Where the employee is paying any amount in respect of such services, the amount so paid shall be deducted from the value so arrived at.
Free or Concessional Educational Facilities ;
The value of benefit to the employee resulting from the provision of free or concessional educational facilities for any member of his household shall be determined as the sum equal to the amount of expenditure incurred by the employer
Where the educational institution is itself maintained and owned by the employer or where free educational facilities for such member of employees’ household are allowed in any other educational institution by reason of his being in employment of that employer, the value of the perquisite to the employee shall be determined with reference to the cost of such education in a similar institution in or near the locality.
Where any amount is paid or recovered from the employee on that account, the value of benefit shall be reduced by the amount so paid or recovered
Value of Travelling accommodation & Touring ;
The value of travelling, touring, accommodation and any other expenses paid for or borne or reimbursed by the employer for any holiday availed of by the employee or any member of his household, other than concession or assistance referred to in rule 2B of these rules, shall be determined as the sum equal to the amount of the expenditure incurred by such employer in that behalf.
Where such facility is maintained by the employer, and is not available uniformly to all employees, the value of benefit shall be taken to be the value at which such facilities are offered by other agencies to the public.
Where the employee is on official tour and the expenses are incurred in respect of any member of his household accompanying him, the amount of expenditure so incurred shall also be a fringe benefit or amenity:
Provided that where any official tour is extended as a vacation, the value of such fringe benefit shall be limited to the expenses incurred in relation to such extended period of stay or vacation. The amount so determined shall be reduced by the amount, if any, paid or recovered from the employee for such benefit or amenity.
Value of benefit by transfer of moveable asset ;
The value of benefit to the employee arising from the transfer of any movable asset belonging to the employer directly or indirectly to the employee or any member of his household shall be determined to be the amount representing the actual cost of such assets to the employer as reduced by the cost of normal wear and tear calculated at the rate of 10 per cent of such cost for each completed year during which such asset was put to use by the employer and as further reduced by the amount, if any, paid or recovered from the employee being the consideration for such transfer
Provided that in the case of computers and electronic items, the normal wear and tear would be calculated at the rate of 50 percent and in the case of motor cars at the rate of 20 percent by the reducing balance method.
Sec 16(ia) – a deduction of fifty thousand rupees or the amount of the salary, whichever is less
Sec 16(ii) – a deduction in respect of any allowance in the nature of an entertainment allowance specifically granted by an employer to the assessee who is in receipt of a salary from the Government, a sum equal to one-fifth of his salary (exclusive of any allowance, benefit or other perquisite) or five thousand rupees, whichever is less;
Sec 16(iii) – a deduction of any sum paid by the assessee on account of a tax on employment within the meaning of clause (2) of article 276 of the Constitution, leviable by or under any law. (Profession Tax).
– CA Bhargava D.M
GST BLOCKED CREDITS
Index :
- Introduction
- Blocked Credit -I
- Blocked Credit -II
- Blocked Credit – III
- Blocked Credit – IV
- Blocked Credit – V
As per Section 16 (1), Every registered person, shall be entitled to avail input tax credit if the goods and services received is used or intended to be used for business purposes.
Section 18(1) talks about Availability of Credit during special Circumstances.
E.g. : ITC on Stocks , inputs contained in finished and semi finished goods.
Section 17 (5)
Notwithstanding anything contained in Section 16(1) and Section 18 (1), Input tax credit shall not be availed in respect of the following Goods and Services.
In Short,credit which cannot be utilized or considered by a Registered Taxpayer is Known as Blocked Credit.
MOTOR VEHICLE
- For Passenger Transport
- With Approved Sitting Capacity upto 13 (Inclusive of Driver)
Except when used for :
- Making taxable further supply of such vehicle
- Supplying Taxable transportation of Passengers
- Giving taxable training of Driving such Vehicle
VESSELS / AIRCRAFT
Credit of these inputs won’t be allowed unless used for the exception as above 3 points and if it is used for transportation of Goods.
Except when :
- ITC on such vehicle / Vessel /Aircraft not blocked
- Such Services received by a taxable person who is engaged in
1. Manufacturer of Such Vehicle/ Vessel /Aircraft
2. Providing Insurance Services in respect of them
- Food & Beverages/Outdoor Catering
- Beauty treatment/Health Services/ Cosmetic and Plastic Surgery
- Life or Health Insurance
- Leasing / Renting / hiring of Motor Vehicle/vessel/aircraft (except when used for purposes specified there)
- Club membership/health & fitness center Membership
- Travel benefits to employees on vacation, like Leave travel Concession
Overall Exception : Except where Govt notifies that obligatory for employer to provide to employee under any law.
Works Contract Service for construction of Immovable property
(except where used for further supply of works contract service only)
Goods/ Services /Both for Construction of Immovable property
(Except P&M) on own account, incl. when for business purpose.
Construction includes re-construction/ renovation/ additions /alterations/repairs which are capitalized to the said immovable property
Plant & Machinery means apparatus, equipment and machinery fixed to earth by foundation or structural support used for making an outward supply of goods /services/ both & includes such foundation /structural support but excludes
- Supplies used for Personal Consumption
- Goods lost/stolen/destroyed/written off/gifted/given as free Samples
- Supplies received by NR Taxable person (except goods imported by him)
- Supplies received from Composition taxable person
- Any Tax paid under the provision of Section 74, 129, 130 (Fraud, Detention , Confiscation).
– Bishal Deb
Tax Deduction at Source (TDS) Payment
Introduction to TDS :
- To collect tax from source of income
- The Deductor to deduct tax and remit to the Government
- The Deductee can claim the credit on the basis of Form 26AS or TDS Certificate
- TDS to be deposited by 7th of Every month.
- Non payment/Non deduction of TDS:-
Sections under TDS :
The following are the list of sections under which TDS can be deducted:-
Payment of TDS :
We can Pay TDS in the following 2 methods:-
Following are the Pre-requisites:-
- Laptop/PC/Cyber Cafe with Internet Connection
- TAN of the Deductor
- Amount of TDS Deducted and interest if any
- Whether Company/Non-company Deductee
- Section of Deduction
- Type of Payment
- Net Banking
- AY ( Assessment Year )
- City/State/Pincode
Electronic Mode (1st way)
Electronic Mode (2nd way)
Physical Mode
– Harsh S Khimashiya
harsh@accstra.in
RCM under GST
- Introduction.
- Flow of GST.
- Reverse Charge.
- Liability to Pay under RCM
- Time of Supply of Services under Reverse Charge.
- Input Tax Credit
Introduction :
- Under GST, usually the supplier of goods or services has to pay the tax to the Government.
- However, under the Reverse Charge Mechanism, the liability to pay GST is cast on the recipient of the goods or services.
- Reverse Charge Mechanism means the liability to pay taxes lies with the recipient of the goods or services in respect of notified categories of supply
Flow of GST :
Reverse Charge :
- Sec 2(98) of the CGST Act, 2017 states that reverse charge” means the liability to pay tax by the recipient of supply of goods or services or both instead of the supplier of such goods or services or both under sub-section (3) or sub-section (4) of section 9, or under sub-section (3) or sub- section (4) of section 5 of the Integrated Goods and Services Tax Act;
- Sec 9(3) & 5(3) states “The Government may, on the recommendations of the Council, by notification, specify categories of supply of goods or services or both, the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both”
- Sec 9(4) & 5(4) states “The Government may, on the recommendations of the Council, by notification, specify a class of registered persons who shall, in respect of supply of specified categories of goods or services or both received from an unregistered supplier, pay the tax on reverse charge basis as the recipient of such supply of goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to such supply of goods or services or both.
Liability to Pay under RCM :
- The time of supply is the point when the supply is liable to GST.
- One of the factors relevant for determining time of supply is the person who is liable to pay tax.
- In reverse charge, the recipient is liable to pay GST. Thus, time of supply for supplies under reverse charge is different from the supplies which are under forward charge.
Time of Supply of Goods under Reverse Charge :
As per Section 12(3) of the CGST Act, 2017 in case of supplies of goods in respect of which tax is paid or liable to be paid on reverse charge basis, the time of supply shall be the earliest of the following dates, namely :-
- date of receipt of goods; or
- date of payment as entered in the books of account of the recipient or the date on which the payment is debited in his bank account, whichever is earlier; or
- the date immediately following 30 days from the date of issue of invoice or any other document, or similar other document thereof by the supplier
Provided that where it is not possible to determine the time of supply under clause (a) or clause (b) or clause (c), the time of supply shall be the date of entry in the books of account of the recipient of supply.
As per Section 13(3) of the CGST Act, 2017 in case of supplies for Services in respect of which tax is paid or liable to be paid on reverse charge basis, the time of supply shall be the earliest of the following dates, namely:-
- the date of payment as entered in the books of account of the recipient or the date on which the payment is debited in his bank account, whichever is earlier; or
- the date immediately following 60 days from the date of issue of invoice or any other documents, similar other document thereof by the supplier :
Provided, where it is not possible to determine time of supply by using above methods under clause (a) and clause (b), the time of supply shall be the date of entry in the books of account of the recipient of supply.
Input Tax Credit :
- A supplier cannot take Input Tax Credit of GST paid on goods or services used to make supplies on which the recipient is liable to pay tax under reverse charge.
- The recipient can avail Input Tax Credit of GST amount that is paid under reverse charge on receipt of goods or services by him.
- GST paid on goods or services under reverse charge mechanism is available as ITC to the registered person provided that such goods or services are used or will be used for business or furtherance of business.
- The ITC is availed by recipient cannot be used towards payment of output tax on goods or services, the payment of tax under reverse charge only on cash.
– Bhargava.DM
COMPANIES FRESH START SCHEME – 2020
The Ministry of Corporate Affairs has launched a scheme known as “Companies Fresh Start Scheme, 2020” condoning the delaying filing the documents with Registrar, it relates to the waiver of additional fees & granting of immunity from launching of prosecution or proceedings for imposing penalty on account of delay associated with certain filings.
Why CFSS (Companies Fresh Start Scheme)??
CFSS is introduced with the motive of reducing compliance burden. The aim is to provide defaulting companies a chance to make their compliances good.
Whom is CFSS – 2020 applicable
- Any Company which has failed to file any mandatory form with ROC may avail this scheme
- The Said Scheme is Applicable to any Defaulting company, Defaulting companies are permitted to file the belated documents, which are due for filing on any given date in accordance with the provision of this Scheme.
“Defaulting Company” means a company defined under the Companies Act, 2013, and which has made an default in the filing of any of the documents, statements, returns, etc including annual statutory documents on MCA-21 Registry.
What is the procedure to avail the scheme
Following are the tasks which are required to be done
- We have to do is file all our pending documents and forms before 30thof September, 2020.
- Also, there is an E-form CFSS – 2020, in which we need to file within the six months of the closure of the said scheme.
What is E-Form CFSS -2020? When and why to file it?
E-Form CFSS-2020: (Application of issue of immunity certificate)
- E Form to be filed after filling all belated documents mentioning SRN of the e-forms
- Required to be Filed with MCA within 6 Months after the End of the Scheme
- There is no filing Fee for E Form CFSS-2020
- Certificate of immunity will be issued by ROC
- After certificate of immunity, no prosecution or proceedings can be initiated
- Company will withdraw all appeals against any prosecution and ROC will withdraw all the proceedings
What forms which can be filed under the Companies Fresh Start Scheme, 2020?
The forms which are subject to additional fee under section 403 of Companies Act, 2013 are eligible for filing under CFSS, 2020 and are classified under
- Annual Based
- Annual Return- MGT-7
- Financial statement- AOC-4
- Event Based
- Other forms required to be file with Roc Like
- PAS-3
- MGT-14
- ADT-1
- Any other form
- Exceptions:-
-
- SH-7- Increase in Authorized
- Charge related form (CHG-1, CHG-4, CHG-8 or CHG-9) Capital
Income Computation & Disclosure Standards
