Income Tax Returns | CA in Mumbai | Chartered Accountant | ITR Filing

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Rated among Top 100 CA in Mumbai - Best CA Mumbai by multiple websites such as Justdial, Webindia, Topcafirms.com, etc. In India, CA (Chartered Accountants) are regarded as the maestros of Accounts and Taxes, just as Sachin Tendulkar is for Cricket! This is because it is the most comprehensive course that allows gaining extensive knowledge and three long years of practical experience and exposure in planning income and investment portfolios, calculating taxes and filing ITRs under the mentor-ship of an already experienced CA (Chartered Accountant). In fact, with the advent of comprehensive online tools in the COVID era, there are a lot of applications and websites that provide both automated and manual support to plan and calculate taxes. But there are still a lot of factors that need to be considered before settling on a CA (Chartered Accountant) to plan the tax liability on one’s hard earned money. Let’s have a look at some of the factors that are noteworthy before finalizing on a CA (Chartered Accountant) / Tax Advisor: 1. Finding out the entity’s status: This is an important step since this requires assessment of the status of the taxpayer. This is because there are varied complexities in every type of entity which needs to be addressed accordingly by a relevant tax expert. See the following scenarios: Individual Status: If the taxpayer is an individual, he/she can refer to an CA (Chartered Accountant) who primarily has expertise in Direct Taxation. Corporate Status: If the taxpayer is a corporate entity, the Directors of the company might want to refer to a more seasoned CA (Chartered Accountant) / Tax Advisor who primarily has expertise in both Direct Taxation and Indirect Taxation, in addition to Corporate Tax, as well as Provident Fund, Employee State Insurance advisors, etc. Others: If the taxpayer is a Partnership Firm, LLP, etc., the partners or members might have to refer to a blend of above. 2. Assessing whether the Income and Tax Structure of the entity is complex enough to hire a CA as the fee charged may or may not be justified to the taxpayer. Following the above scenarios, an individual might just as for guidance from an CA (Chartered Accountant) in the family or friends in case the assess able income is not too big, whereas a firm or a company might need a proper team of expert advisors to mitigate the tax burden at a large level. 3. Not every CA (Chartered Accountant) is specialized in the field of taxation. Taxation is an extensive field with various branches. Finding someone experienced and specialized in the branch that a person needs help with is quite important. This could be understood in terms of the large different types of tax advisors that exists, viz., Income Tax, Gift Tax, Wealth Tax, Capital Gains Tax, Corporate Tax, GST, Customs & Excise, etc. 4. It is necessary to ensure that the CA (Chartered Accountant) is always available and updated in terms of the recent Income Tax Notifications or the ever so changing Income tax Return Forms to address any immediate changes in the taxpayer’s income or status. For example, a Capital gain somewhere in the middle of the year could change the calculations and planning of taxes and give rise to a requirement to pay Advance Tax. 5. A few common factors such as the past experience and area of practice of the CA (Chartered Accountant), the clients or industries they have served, the reasonability of the fee charged with respect to the general market fee, an example of a fruitful advise they gave to some client which was a turnaround for the client’s tax burden. Choosing a CA (Chartered Accountant) carefully is important because the person entrusts all the income details and their sources to them. So, the focus should be on to retain the same person for as long as they can be as that would ensure no scattering of personal information to a lot many people again and again. This also helps in maintaining a close relationship to build trust and faith in each other. So, keeping these small things in mind will help a taxpayer go a long way in finding a perfect advisor, consultant and a partner!

Declare all gains arising out of the Liquid funds

Declare all gains arising out of the Liquid funds Please make sure that you declare all short term and long term gains arising out of the Liquid funds and short time duration debt funds. Failure to do so would invite a scrutiny from income…

How To Pay Tax On Cryptocurrency In India

Tax On Cryptocurrency In India

How To Pay Tax On Cryptocurrency In India

In this article, we shall focus on Crypto traders dilemma as to How To Pay Tax On Cryptocurrency In India. First, a little about us - We are the leading crypto tax consultants in India. We handle all your Income Tax compliances for any incomes arising on any Blockchain or cryptocurrency trading. So while you invest, trade, mine, run nodes or offer Blockchain solutions, we are happy to take care of your crypto taxes for you.

Ok, now back to main topic, Under Indian tax laws, the nature of virtual currency investments is unclear. What is certain is there’s no escaping taxes. Notices have reportedly been served to about 500,000 investors for non-payment of taxes. In the past few months, crypto exchanges, too, have appeared on the Reserve Bank of India’ and the government’s radar. The RBI has forbidden banks from dealing with these exchanges and investors in any fashion, while a panel formed by the Narendra Modi government is working on draft regulations for digital currencies. In such volatile times, We have urging our clients to not skip paying taxes.

As the deadline for filing I-T returns approaches, here’s a look at what investors could do.

 

Tax On Cryptocurrency for Individual investors

As the tax treatment of  cryptocurrency continues to be in the grey zone, it is open to interpretation.

In case of gains, you have to state profits or capital gains made by you from transaction in cryptocurrencies year-wise with statements showing the workings says the tax notice sent by the I-T department to investors in the last few months. As a result, most chartered CAs including us are inclined to treat these investments as capital gains tax.

The premise of capital gains is that an investment will be held for a certain period of time so that its value appreciates. These taxes are divided into ****short-term and long-term.

For most investments such as equities, jewellery, land, debt funds, etc. the time period is specified, according to which an item may be taxed under short-term or long-term gains. However, since it is not specified, we are going to assume and take the longer time-frame of three years, and only after holding the investment for three years it will be called long-term gains.

In case of a short-term gain, the amount is added to the income and taxed according to the tax slab that an individual falls under. For instance, anyone who earns over Rs10 lakh ($14,614) will be taxed at 30%.

If it falls under the long-term category, it will be taxed at 20%. The tax rate can go down further once indexation benefit is applied, which allows one to adjust for inflation during the period these investments were held. Every year, the Central Board of Direct Taxes releases the cost inflation on which these assessments are done.

However, since details of the tax treatment are unclear, We suggests a safer alternative is to report it as income from other sources. In this case, the amount gets added to the salary or business income and then taxes are paid on it as per the slab under which an individual falls.

 

Tax On Cryptocurrency for traders

For a trader, earnings from virtual currencies are treated as income from business. Under this, certain expenses related to business, office maintenance, such as buying a computer, internet expenses, office rent, administration cost, etc., can be deducted. Then, on the remaining amount, tax will be applicable as per the slab.

If you are a trader and your turnover crosses the Rs 2 crore mark, you need to go for a tax audit by a chartered accountant.

Another key issue is choosing the right form to file returns. Depending on whether an individual is treating it as capital gains or income from other sources or business, ITR2 or ITR3 must be picked.

DISCLAIMER

The contents of this article are for information purposes only and do not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc before acting on the basis of the above write up.  The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that we are not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof. CA Mitesh and Associates is India's leading Cryptocurrency Taxation Firm which is committed to helping people navigate complex tax laws and banking regulations. Our main aim is to assist the individuals with applicable laws & regulations compliance and providing support at each & every level to make sure that they stay compliant and grow continuously. For any query, help or feedback you may get in touch here - Appointment with CA. Please note the all consultations with the CA are Paid consultations.

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