Well i have been late this year and still haven't file my tax return.But it will be completed by this month. Now the problem is this year our gross sales(turnover ) was 51 lakh rupees.
Out of which 5 lakh is vat amount(just for reference purpose mentioning same). Now basically our profit margins is somewhere around 10-11%.We took 11.5%.5 lakh 85000 as profit.
Now because this year the expense in our business was more hence the net profit after deducting all the expense comes below net 8% profit. Somewhere around 3 lakh 80000 .
We do maintain all ledgers,books of accounts,bank statements ,journals etc.required for the same systematically. Now my Ca office staff(article) is suggesting me to go for presumptive method saying though taxation will be more but i cant be scrutinized and they do not endorese anyone filing return with less than 8% profit. Also he calculated advance tax penalty on my figure even after calculating presumptive.I guess presumptive method doesnt require advance payment. Also he said i can claim deduction on presumptive rates on 80c investment of 96000 which i did last financial year.I am not sure about it.
Now i am in 2 mind.Some of my doubts are as follow
1::Whether 80c deductions are allowed or not.And even if it does i read somewhere in DTC regime it wont count.SO is it wise to go with presumptive way now as in future it wont be count.
2:: Does advance taxation applies to me in both presumptive or straight way?Because last year our turnover was just around 25 lakhs on which somewhere we paid 6000 tax.No question advance tax was asked than.
Also how can we know in advance that we qualify for advance tax and pay the same in advance.Or is it we must pay some amount and later wait for refunds stuff.I am still not clear with this concept except advance tax needs to be paid when tax payment should be more than 5000.
3::Also once i go for presumptive all my life we should maintain same concept of taxing else we must audit our account if we revers is what i heard.
Since i maintain all records.
Plus on top of that if any losses occur in our business than surely our profit will turn negative but in presumptive case i need to pay tax anyhow even being in loss.
Also in future i cant get any benefit on depreciating assets say buying furniture or shop related expense.So i am really against of going it. What do you geeks suggest?
CAclubindia
