How to take Maximum Benefits from Different sections of Income Tax Act

How to take maximum benefits from Income Tax

Now that March is coming closer a proper Tax planning is essential for you to take maximum benefits from Income Tax rebates available under different sections of Income Tax Act .

Here are some of the sections under which you can claim Tax rebates .

Section 80C : Maximum Rebate Rs 150000 by investing in PF, PPF , ELSS , NPS Etc.

SECTION 80D : Maximum Rebate Rs 25000 for medical cover of self and family

Section 80CCD : Max Rebate Rs 50000 exclusively for NPS

Section 80D : Maximum rabate full amount of actual interest paid on education loan of children , spouse, close relatives.

Section 24 : Max rebate Rs 2 lakh on home loan interest .

Please note that most of these sections are not only for your current year tax saving but also for your future comfortable retirement life too, be it PF, Insurance , Home loan or Pension scheme . So invest in these schemes as much as possible to reap the benefits today and tomorrow .

Trick : Here is a trick for you , if you estimate that you are on border line of 30% Tax bracket , donate money to charitable institutions and claim Tax rebate under section 80G that may bring back you to 20% tax bracket and you may get enough publicity on FB too. Happy Tax Saving.....

How to deal with Income Tax Notice

Now that filling of Income Tax return is over , and processing of your  Tax return has started  , all will get an intimation notice from the Income Tax Dept  regarding processing of your Tax return .
An intimation under section 143(1) is issued by the CPC under any of the three instances:
There is tax liability to be paid;
A refund has been determined;
There is no refund or demand,

If as per the intimation u/s 143(1) there is a tax demand then this intimation becomes notice of demand and this intimation will be treated as Notice of demand u/s 156. Accordingly, you will have to pay the entire amount within the time mentioned in the notice."

The intimation will be sent to you regarding the same via email and SMS under section 143(1). You will find the tax demand notice on your online account on the e-filing website  https://incometaxindiaefiling.gov.in/. According to the current income tax laws, the time limit to respond to this is 30 days. If you do not respond to the notice within the stipulated time period, the department can take action against you.

If the person to whom the section 156 tax notice for demand has been issued fails to pay the amount demanded within the time limit, then the assessee is liable for the following penalties:

Interest u/s 220- Interest at the rate of 1 percent each month or part thereof is payable after the expiry of the 30 days time provided under section 156 tax notice.

Penalty u/s 221- A penalty u/s 221 may be imposed by the assessing officer on the assessee

You can respond to the tax notices by logging in to your account on the e-filing website  https://incometaxindiaefiling.gov.in/
Here is the Procedure:
1. Login to your account on the e-filing website by entering your credentials: User ID (PAN), password, and captcha code.


2. Click on the 'e-file' tab and select 'Response to outstanding Tax Demand' option.


3. An outstanding tax demand notice will appear on your screen with details such as assessment year (AY), section code (under which the notice has been served), demand identification number etc.


4. Click on 'Submit' in the response column for the appropriate AY to submit your response. The assessee has to select one of these options:
A) Demand is correct
B) Demand is partially correct
C) Disagree with demand
D) Demand is not correct but agree for adjustment

Enter the necessary details and click on 'submit'.

Once the information is successfully sent to the department, then a transaction ID will be generated.

You can check your response by clicking 'View' in the response column. You can click on the 'transaction ID' to check the response sent by you to the department.

Once you have submitted your response, please keep checking “ My Account “  by logging into Income ax site every week or so  to know the department's response,


If you need further  help in this matter please contact us www.etaashfinserve.com   or whatsapp 9470307730.

All about HUF

All about HUF

HUF (Hindu Undivided Family ), Basic purpose of creating a HUF is to save Income Tax arising out of family Income .This is new form of Tax saving tool. In India there are many Hindu families who live jointly and their properties are ancestral as well as self acquired. Income arising out of such properties can be shown as separate income and to be taxed separately.

Basically, HUF account can be created by right of birth and not by an agreement between two parties. Any individual covered under Hindu personal law that is Hindu,Sikh, Jain or Buddhist can create an HUF account, if they have property income and want to save income tax.

Benefit of creating HUF

By creating HUF one can save substantial amount of Income tax , this is because HUF is treated as distinct entity , separate from Individual forming the HUF.

Let me give you a live example question asked by a client :

Sir, I am working in govt job and my total income is around Rs. 12 Lakh per year . My wife is a school teacher and her income is around Rs 6 lakh per year . When My father was alive he had constructed house and some shops . From that we get rental income of around Rs. 50000 per month .This income is added to my income and I have to pay Income tax on it along with my income. I want to know how can I show this income separately so that it is not taxed in my hand.??

This question was asked by one of my client.

My answer is he should create a HUF and obtain a separate PAN for HUF , that way his income from ancestral house and shops amounting to Rs.6 Lakh (@Rs 50,000/-) will not be taxed in his hand.

Let us calculate his Taxable Income before and after Creating HUF

Income Tax payable before creation of HUF

Income from salary : Rs. 12,00,000

Income from Property : Rs. 6,00,000

Less : Admissible Expneses for Property 1/3= Rs. 200000

Taxable Income from Property = Rs. 4,00,000

Total Taxable Income = Rs. 16,00,000

Income tax payble = Rs. 304200/-

If he creates HUF

a. income from his Salary (after deductions) Rs. 12,00,000

Tax payable : Rs. 179400/-

b. Income from HUF Rs. 600000

less admissible ded. Rs. 200000                                                                                 

Taxable income Rs. 400000

Tax payable = Rs. 7800

Total Tax payable : 179400+7800 = Rs. 187200

saving in Tax Rs. 117000

Salient features of HUF

1. HUF has its own PAN and files a separate tax return. A separate joint Hindu family business is created since it has an entity separate from its members.

2. Deductions under section 80 and other exemptions can be claimed by the HUF in its income tax return.

3. HUF can take an insurance policy on the life of its members and claim deductions under section 80C upto Rs. 1.50 Lakh

4. HUF can pay a salary to its members if they contribute to its functioning of the HUF. This salary expense can be deducted from the income of HUF.

5. Investments can be made from HUF’s income. Any returns from these investments are taxable in the hands of the HUF.

A HUF is taxed at the same rates as an individual.

Please remember your personal income like salary etc can not be shown as HUF income .

A women can not create HUF, she will be part of husband or father's HUF

Only male member can be KARTA of HUF a child becomes a member of HUF by birth itself, no agreement required.

If you are interested in creating a HUF to save your Income Tax , please contact us.(whatsapp 9470307730

What are documents required for GST registration ?

What are documents required for GST registartion ??

For different categories of entity , different documents are required for Registration of GST

1. For Sole Proprietorship –

Photo of sole proprietor;

Copy of PAN card;

Copy of bank statement or cancelled cheque or first page of the pass book of owner.

Copy of address proof for registered office;

Electricity bill, water bill, landline bill etc. of owner;

Copy of legal ownership document or municipal bill copy (in case of owned premises)

Rent agreement and No Objection Certificate (NOC) from the owner of the premises (in case of rented premises).

2. Partnership Firm –

PAN card of partnership firm and designated partners;

Photograph of all the partners;

Identity proof of all the partners;

Copy of address proof for registered office;

Electricity bill, water bill, landline bill etc.;

Copy of legal ownership document or municipal khata copy (in case of owned premises)

Rent agreement and No Objection Certificate (NOC) from the owner of the premises (in case of rented premises).

Copy of partnership deed;

Copy of bank statement or cancelled cheque or first page of the pass book.

3. Limited Liability Partnership (LLP) –

PAN card of LLP and of designated partners;

Photographs of designated partners;

Copy of registration certificate of LLP;

Copy of identity proof of designated partners;

Copy of address proof of registered office;

Electricity bill, water bill, landline bill etc.;

Copy of legal ownership document or municipal khata copy (in case of owned premises)

Rent agreement and No Objection Certificate (NOC) from the owner of the premises (in case of rented premises).

Copy of LLP agreement;

Copy of bank statement of LLP or cancelled cheque or first page of pass book;

Copy of Board’s resolution.

4. Private Limited Company, Public Limited Company And One Person Company –

PAN card of company and directors;

Copy of registration certificate of the company;

Photograph of all the directors;

Copy of identity proof of the directors;

Copy of address proof of registered office;

Electricity bill, water bill, landline bill etc.;

Copy of legal ownership document or municipal khata copy (in case of owned premises)

Rent agreement and No Objection Certificate (NOC) from the owner of the premises (in case of rented premises).

Copy of Memorandum of Association (MOA) and Articles of Association (AOA);

Copy of bank statement or crossed cheque or first page of pass book;

Copy of Board’s Resolution.

5. Hindu Undivided Family (HUF) –

Copy of PAN card;

Photograph and PAN of Karta;

Copy of address proof of registered office;

Electricity bill, water bill, landline bill etc.;

Copy of legal ownership document or municipal khata copy (in case of owned premises)

Rent agreement and No Objection Certificate (NOC) from the owner of the premises (in case of rented premises).

Copy of bank statement or crossed cheque or first page of pass book;

Authorized signatory (if different) – Photo; Letter of authorization.Authorized signatory –

6. Society / Trust / Club –

Copy of PAN card of society / trust / club and of promoters / partners;

Photograph of promoters / partners;

Copy of registration certificate;

Copy of address proof of registered office; Electricity bill, water bill, landline bill etc.;

Copy of legal ownership document or municipal bill copy (in case of owned premises)

Rent agreement and No Objection Certificate (NOC) from the owner of the premises (in case of rented premises).

Copy of bank statement or crossed cheque or first page of pass book;

Authorized signatory (if different) – Photo; Letter of authorization.

What is Presumptive Taxation

What is Presumptive Taxation  (Section 44AD)

We all know that in order to calculate Tax payable by a business house or Professionals like Doctor , lawyers, CA etc , we have to check their Books of accounts , Find out his Turnover or Income and assess Income tax payable by Them.

However in order to save them from complexities , Govt has launched a scheme for such Business man whose annual turnover is less than 2 crore per FY  and Professionals whose Income is less than 50 lakh per FY to avoid keeping books of Accounts and pay tax on Presumption basis as follow :

A person adopting the presumptive taxation scheme can declare income at a prescribed rate and, in turn, is relieved from tedious job of maintenance of books of account.

in case of a person adopting the provisions of section 44AD, income will be computed on presumptive basis, i.e., @ 8% of the turnover or gross receipts of the eligible business for the year.

Income shall be calculated at rate of 6% in respect of total turnover or gross receipts which is received by an account payee cheque or draft or use of electronic clearing system.

In other words, in case of a person adopting the provisions of section 44AD​, income will not be computed in normal manner (i.e., Turnover less Expense) but will be computed @ 8%/6% of the turnover.

Income at higher rate, i.e., higher than 8% can be declared if the actual income is higher than 8%. ​

Professionals like doctors, lawyers, architects, interior designers CA CMS CS and others can adopt PTS. For them, 50% of the total receipts during the fiscal will be considered as profit and get taxed accordingly. A professional can voluntarily declare the income at a higher rate than mandatory 50% of the total receipts.

Example :

A business house adopts PTS (Presumptive Tax System ) , his total income by way of cash transaction is 1 cr and by way of digital mode (Banking) is 50 lakh , his income for taxation purpose will be computed as follow

8% of 1 crore =  Rs. 800000

6% of 50L     =  Rs. 300000

 Toatl             = Rs  1100000

Tax on Rs 11 Lakh will be computed as per his slab

2. A lawyer receives Rs 50 Lakh as his fee in a year. His income for tax purpose will be Taken as Rs 25lakh (50% of Rs 50 Lakh) . Tax on 25 Lakh will be computed as per his Slab.

In both cases books of Accounts are not needed to be maintained.

This scheme is not available for salaried class people.
for more information please do whatsapp 9470307730

What is Digital Signature & Why you need it ?

What is Digital Signature and why you need it ??

A Digital signature is simply your own signature in digital form . you can use it like you use your pen for your signature in signing various documents like rent agreements, Income Tax returns, GST returns , e-tender, Your letter, your email etc etc. in paper form .Simply said it is your Digital Pen. Digital signatures are easily transportable and cannot be imitated by someone else. The ability to ensure that the original signed message arrived means that the sender cannot easily disclaim it later.

Now you will say if I can sign with my pen why should I have a Digital Signature . Well , take this simple example , you
have entered into an agreement ( for Business, Rent , Sale deed or anything like) with someone living at some other place.
He sends you the agreement copy by email for your signature . How will you do it ???
a. you will download the document from your mail box
b. print it ,
c. Sign on it
d. Scan it and upload in your mail box and
e. sent back to sender.
all above process will take much of your time and energy .
Now if you have a digital Signature , you can easily put your signature at signing place and just reply back to sender
saving your time and energy.

Now you will ask is it legally valid ??

Answer is YES , subsequent to the enactment of Information Technology Act 2000 in India, Digital Signature Certificates
are legally valid in India.Digital Signature Certificates are issued by licensed Certifying Authorities ( Like eMudhara,
Capricorn, Sify ) under the Ministry of Information Technology, Government of India as per the Information Technology Act.
These Certifying agencies have appointed partnerns in different cities who issue digital signature to those who need it We are authorised partner of eMudhra and you can buy your digital signature from us.

What is the Process :

You need to apply on prescribed form . Your Photo, Aadhar card, Pancard, residence proof are required to varify . You can also apply online by providing offline Aadhar e-kyc. For further detail please contact us or whatsapp 9470307730.

What is Reverse Charge in GST

What is reverse charge in GST

 What is Reverse Charge in GST

We all know that it is usually seller who has to collect GST and pay it to govt. However in Reverse Charge it is the Purchaser who has to pay GST and not the supplier.

Such situation arise when

1. Supply is made by an unregistered dealer to a registered dealer. Then registered delaer will have to pay GST
2. Supply of certain Goods & Services listed by CBES
3. service through E commerce If an e-commerce operator supplies services then reverse charge will be applicable to the e-commerce operator. He will be liable to pay GST. For example, Amazon provides Goods & services etc. Amazon  is liable to pay GST and collect it from the customers instead of the registered service providers.