09 February 2012
Here is a situation... I would have a gross income of around 25 lacs upto March 2012 & Im planning to file the IT under Sec.44AD (income is frm website development,advertisements etc. & im sole proprietor) I would also be paying 10.3% Service tax that comes around 2.5 lacs. Under Sec.44AD, i shall declare 8% as profit, that is around 2lacs & i pay tax on this derived amount as per the IT slab.
My question is 1) The amount i pay as ST is high while IT would be low.Is this acceptable for the taxman or will it create any problem by asking me to pay more IT?
8% is calculated in the gross receipt / billings. The service tax billed is a part of it. The service tax is billed, collected and paid to the department. It is nothing to with the IT computation of 8% on gross billing.
CAclubindia
