29 May 2013
You have to keep some records otherwise how you will be able to ascertain your turnover. At the time of selling scrape you are getting it weighed on a weigh bridge or any other weighing maser. Take the sales turnover and multiply with average selling rate you can arrive to your sales target and for the same quantity you apply the average purchase rate and find out the profit. Noq, you may say what about stock. In this case we will not take any stock as it has not been included in purchases and only net sales has been taken as sales by quantity and the same quantity has been taken as purchases. You can take the shelter of section $$AD and show minimum profit of 8% or 5% as the case may be. for income tax purpose. But once your turnover increases and touches the tax audit limit you will be in trouble.
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