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The 50th meeting of the GST Council last month introduced numerous fresh updates and changes to the GST law. Alongside decisions about GST rates on goods and services, the Council discussed the taxation on several resources. Additionally, the Council proposed modifications to the GST law to simplify compliance, particularly suggesting using DRC-01C forms to address disparities between GST returns. Among these forms, a recent notification this month proposed an alteration to the Central Goods and Services Tax (CGST) Rules, introducing a new form known as DRC-01C. This form's implications and its effects on businesses are outlined below. Difference Between GSTR-2B & GSTR-3B Form of DRC-01C Central Tax Notification 38/2023 recommended the inclusion of Rule 88D, which outlines how differences in input tax credit (ITC) within GST returns will be managed. As per this rule, if the ITC claimed in GSTR-3B exceeds that available in GSTR-2B by an amount or percentage specified by the gov...

As per the Income Tax Act, of 1961, certain taxpayers are compulsorily required to undergo income tax audits of their books of accounts. An income tax audit is an in-depth inspection of the books of accounts of a business entity or a professional person. This action has several benefits, including: It shows a dedication to promoting financial transparency and responsibility. it ensures that financial records and ITRs are accurate and reflect the actual financial activities of the taxpayer. These audits act as a deterrent against tax evasion by discouraging entities from misrepresenting their income or inflating their expenses to reduce their tax obligations. If you are interested in learning about the deadline for filing a Tax Audit Report and ITR for certain taxpayers, as well as who is qualified to conduct an Income Tax Audit according to Income Tax Rules , then this article is for you. When Should Tax Audit Reports be Submitted as Per I-T Department? A taxpayer who needs to obtain a...

Section 16(2) of the Central Goods and Services Tax (CGST) Act, 2017 does not have an overriding effect on section 16(4) since both sections would be regarded as mutually exclusive and independent in their functioning, the High Court of Andhra Pradesh ruled. The decision was issued in response to a writ petition that the taxpayer Thirumalakonda Plywoods filed via its single proprietor Kondalaiah Sunduru, who questioned the constitutionality and interaction of these clauses. Thirumalakonda Plywoods, the petitioner assessee, operates a hardware and plywood company in Andhra Pradesh. The petitioner's objections to the Assistant Commissioner of State Tax order recommending tax, penalty, and interest owing to their late submission of monthly reports and Input Tax Credit (ITC) claims formed the basis of the dispute. The ITC idea allows purchasers to deduct the tax paid on purchases from the tax owed on sales. It is intended to eliminate the tax cascading impact. Section 16(2) of the An...

As the last date of Income Tax Return (ITR) filing, 31st July 2023, has gone, the income tax department is now thinking to deal with taxpayers who are using fake rent receipts to evade tax, as per the reports. If any tax evasion is found concerning such matters, the department has the authority to collect a penalty of up to 200% of the applicable tax on the hidden income, experts informed. The income tax act makes the house rent allowance (HRA) and donations exempted from tax and deductions. A taxpayer may use a fake rent receipt to claim such an exemption from HRA in order to benefit from the exemption. A tax notice requesting legitimate documentation, proof of rental payments, proof of donations made, etc., can be the result of a fake rent receipt or a bogus donation deduction. An income misreporting would be deemed if the Misrepresentation or suppression of facts, claim of expenditure not supported by documentary evidence, or recording of any false entries in the books of accounts ...

The new GST limit for business turnover exceeding 5 cr shall start tomorrow. Under the Ministry of Finance, a circular of GST system, the businesses having a turnover of exceeding 5 cr shall be needed to get generate the e-invoice from 1st August. From 1st August, companies having B2B transactional value exceeding Rs 5 cr shall need to produce an electronic or e-invoice. For all the B2B transactions the companies should generate an electronic invoice when their yearly revenue would be equal to or more than Rs 10 cr.  For the bigger companies with a turnover exceeding Rs 500 cr and within three years the limit would get diminished to Rs 5 cr. Under GST law e-invoicing for B2B transactions was mandatory for companies with yearly revenues exceeding Rs 500 cr wef 1st Oct 2020, for those with yearly revenues exceeding Rs 100 cr wef 1st January 2021.  The firms holding a turnover exceeding Rs 50 cr would start generating B2B e-invoices from 1st April 2021. The barrier from the dat...

The Goods and Services Tax Network (GSTN) has made public use of an offline utility for forms GSTR-9 and GSTR-9C for the Fiscal Year 2024-25. All registered taxpayers who were formerly normal taxpayers, including SEZ units and SEZ developers, need to file Form GSTR-9 once every fiscal year. In this return, taxpayers are required to include information about their purchases, sales, input tax credit, and any demands or refund claims. The GSTR 9C reconciliation statement compares the details from the yearly returns filed under GSTR-9 for the relevant fiscal year with the details available in the taxpayer's audited annual financial statement. It includes information regarding the taxpayer's gross and taxable income as stated in its books of accounts, as well as the comparable values acquired by summing all of the GST returns submitted throughout the fiscal year. How to Prepare GSTR-9 Form Using an Offline Tool? First of all, kindly make sure you download the updated version of th...

Below are some common and frequently used terms related to taxation and their definitions in layman's language as per the Income Tax Act in India. What is Inclusive Income? The money you earn or get from different sources in a year. Salary, business profit, rent, interest, dividends, etc. All are considered income. What is Tax Deductible  Tax deductible refers to the amount of money you can subtract from your total income, which helps lower the amount of income that is subject to taxation. These deductions are allowed according to the Income Tax Act and may include expenses like medical costs, donations to specific funds, and more. An Overview of GST (Goods and Services Tax) GST is a comprehensive indirect tax applied to the supply of goods and services tax . It is brought in place of various other indirect taxes like service tax, excise duty, and VAT. GST applies different tax rates to different types of goods and services. Advance Pricing Agreement (APA) APA is a special agreemen...