Comission business

For purposes of accounting you need to take commission as income

Sir for income tax filing i am little bit confused i have made a turnover of 60 lakhs for which the company as filed Tds showing 12 lakhs as comission now tell me which turnover should i consider

if you do the commisson as reguler business show under business head . if you receive occasionally show under other source head you can claim expenses under both heads

The Commission value is your Turn Over...

If You deal Purchase & Sale proceeds then the Sale value is your turn over...

Whether to take COMMISSION as your Turnover or SALES as your Turnover is a question which depends upon the facts of the case. There is actually the concept of KACHHA ARHATIYA and PUCCA ARHATIYA which is first need to be understood;

1. Kacchha Arhatiya-

Any commission agent which works ONLY FOR COMMISSION and has NO OTHER CONTROL over sale / purchase price or have no share in profit is called KACCHA ARHATIYA. This kind of Commission Agents needs to TAKE COMMISSION AS THEIR TURNOVER.

2. Pucca Arhatiya -

On the contrary of above; the commission agent which shares the part in profit and have some control over sale/purchase price is called PUCCA ARHATIYA. This kind of Commission Agents would TAKE SALES AS THEIR TURNOVER.

Now coming to your query;

On the basis of your question I could assume that you work ONLY on commission basis and has no share in profit or control over price. Therefore you should take COMMISSION as your Turnover.

(But you share some part in profit etc apart from your salary then you have to take SALES as your Turnover).

what if i have both pure Commission business and also trading

If there is 2 different business i.e One in which you are involved as Pure Commission Agents and the Other Business i.e your Trading Business; THEN:-

Forure commission Business;

You need to take COMMISSION as your Turnover.

For Trading Part;

You'll take entire sale.


And if you are doing both Commission business and Trading business from single Business then you will take SALES AS YOUR TURNOVER.

NITESH BHAI KHA SE ARTICLE SHIP KR RHE HAI AAP... SARI QUERIES KA SOLUTION!!! HATS OFF SIR👃👃👃👃

Ha ha ha.. @ Saurabh Salwani. Articleship is something which just give you an environment to incubate you. It can't teach you anything unless you are ready to Learn something.

So, I truly believe that It's your own interest which make you flawless over the time not the Articleship. No matter where have you done your Articleship from.

BTW, my Articleship period has been over and that was from a Small (micro, infact 😀) Firm.

And One More Important thing... Always Be Helpful to One Another..!! 😊

You are really amazing dear Nitesh. Your thoughts are as nice as your answers! Thank you so much for being here. 😊😊

Very Well Said Man..!! @ Nitesh 👌👌👏👏👏

Very informative thread. 😊😊👌👌