The Income Tax Act 1961, obligates certain eligible persons to file their income tax return once in a year. Filing of Income Tax Return legitimize your earnings and investments whereas non filing it means that you have not disclosed your eligible income which is required to be disclosed as per law, which becomes your Black Money. Also, by filing your Income Tax Return you can get an income tax refund, if you have paid excessive taxes to the government. Further your Income Tax Return plays a crucial role at time of applying loan, credit card, etc. Income Tax Return (ITR) is a form through which you report the details of your income earned from various sources and thereon pay taxes to the Income Tax Department. ITR contains all the details of incomes and tax saving investments done by an individual in a particular financial year. The tax department has notified 7 types of ITR forms i.e. ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6, ITR 7 for filing Income Tax Return (Forms are relevant for individuals, company, firm, etc.).

If your Income doesn’t exceed Rs 2,50,000 during the year, then you’re not legally bound to file your return. But it’s still recommended that you file your return because of the benefits that come with filing income tax return :

Accidental Claims

Proof of Income/Proof of Net worth

Refund

Eligibility in Loan Application

Carry forward capital losses

Carry forward capital losses

Carry forward of losses

For Startup Funding

Protection against Black Money

Buying insurance Policy with high life cover

Obtaining Government Tender

Avoid penalty

Credit Card Application

Growth of the nation

GST registration is commonly differentiated in two type, One is regular and second in composition scheme registration. Before registration in GST we need to understand the difference between Registration types.

GST is new in India and people not very aware with the rules and regulations related to the GST registration. In general a person thinks that all registration are same but with the help of this article we would like to put light on the various type of registration in GST.

GST is new form of taxes comes in India in the place of various taxes like vat, service tax, custom, entertainment tax etc. It is a one nation tax which has a dream of Indian government for so many years. Now you only need to pay GST in place of other indirect taxes, which has been mentioned above.

Different Types of GST registrations

1. Regular scheme

2. Composition scheme

Regular Registration: In this every taxpayer need collect tax from the buyer of good and services and then pay to government after adjusting the amount paid as GST on the input value of goods and service.

1. GST to be paid at the time of purchase and take from the client at the time of sale.

2. Every regular GST registration holder need to pay tax every following month in which he sale his services or goods and also need to file return every month.

3. In regular registration the business have power to sale the product outside the state in which he is registered. And also no restriction on the purchase from other state.

Composition Scheme : In composition scheme registration there are lots of pros and cons. In this registration user need to pay taxes on quarterly basis. Some other points are as follow:

1. In this registration payment on taxes is flat @1% on sales of every good. And input credit of any taxes in not available.

2. In composition there is no need to maintain books of accounts. Basically this registration is best for new business entities.

3. Under GST registration a person can opt for composition registration whose turnover does not exceed 75 lacs and who don't want to sale interstate

We need to understand any service provider cannot opt composition scheme

Is it possible to change Composition to Regular or Vice versa?

Yes, it is possible to change from composition to regular and vice versa at the beginning of the financial year. Change in registration type can be done only once in the year and this can be done every first month of accounting year.

There are various kinds of audit being conducted under different laws such as company audit/statutory audit conducted under company law provisions, cost audit, stock audit etc. Similarly, income tax law also mandates an audit called ‘Tax Audit’. As the name itself suggests, tax audit is an examination or review of accounts of any business or profession carried out by taxpayers from an income tax viewpoint. It makes the process of income computation for filing of return of income easier. Objectives of tax audit

Tax audit is conducted to achieve the following objectives:

• Ensure proper maintenance and correctness of books of accounts and certification of the same by a tax auditor

• Reporting observations/discrepancies noted by tax auditor after a methodical examination of the books of account

• To report prescribed information such as tax depreciation, compliance of various provisions of income tax law etc. All these enable tax authorities in verifying the correctness of income tax returns filed by the taxpayer. Calculation and verification of total income, claim for deductions etc. also becomes easier.

Who is mandatorily subject to tax audit?

A taxpayer is required to have a tax audit carried out if the sales, turnover or gross receipts of business exceed Rs 1 crore in the financial year. However, a taxpayer may be required to get their accounts audited in certain other circumstances. We have categorised the various circumstances in the tables mentioned below:

NOTE: The threshold limit of Rs 1 crore for a tax audit is proposed to be increased to Rs 5 crore with effect from AY 2020-21 (FY 2019-20) if the taxpayer’s cash receipts are limited to 5% of the gross receipts or turnover, and if the taxpayer’s cash payments are limited to 5% of the aggregate payments.