Specified Domestic Transactions, Related Parties under Transfer Pricing

Procedures for ITR e-filing 2015-16

Highlights on changes in Audit formalities under New Companies Act 2013

Highlights on changes in Audit formalities under New Companies Act 2013 from miteshkatira

CA Articleship Why, how and What?

CA Articleship Why, how and What?                         

CA articleship is full of agony and excitement both at the same time. It starts with searching a firm, to doing the on ground work till becoming a CA. CA never forgets his articleship tenure all throughout his life, be it good or “not so good” experience, because it will portrait ‘where you started from’ and ‘what you will be at the end of your articleship period.’

I have been doing my articleship for almost 2 years now in a CA firm at Vidyavihar near Ghatkopar' Mumbai. This firm also has a branch in Roha – Dist. Raigad.  It was a very roller coaster decision for me to start with scratch as to Why, how and what is Articleship?

 

Hence, I thought of sharing my thoughts  on top 7 challenges on selection and  execution of CA articleship with the  “would be” articles and of course in a  matter of time CA’s.....

This I felt would be an apt time for this article. Candidates out there would have just finished with their IPCC exams and would be facing these questions day in and day out. Check your eligibility on the ICAI website.

What all things a Chartered Accountant Student should take into consideration while searching for a Articleship in CA firm:

Any Student will search for an Articleship firm which will help in giving Technical knowledge and Practical exposure for which he/she has to consider following points:

Ø  IDENTIFY YOUR INTEREST

Interest of an individual is of utmost importance while deciding / selecting the field to be pursued in articleship.  Below are the tips to identify it deeply...

• ·         What subject you like the most in studies
• ·         You should identify your strengths and weaknesses i.e you should do a SWOT Analysis
• ·         What are the future prospects of this area of interest

Research about the practical application of the subject since the theory studied might have been totally different..... Ask your friends and colleagues of their practical experiences.

Ø  LOCATION

First priority of a student should be a Firm which is nearby to his residence and which can suffice his expectations in relation to career aspects. In my case, I am lucky enough to get the firm near my residence i.e., Ghatkopar. If the student does not mind traveling, the location should be such that it should be feasible to attend college, classes & office and manage them effectively. Please understand that learning in CA Articleship includes learning to travel in all sorts of difficulties :-)

Ø  FIRM'S PRACTICE AREAS AND CLARITY OF EXPOSURE

One should have a complete knowledge about the prospective firm & get a clarity of exposure to be attained during the Articleship period. Please don't miss out on looking at Firm's Website, Partners, Past and Present Employees, Past or Present Article clerks etc. Most CA firms in Mumbai would definitely have their websites. before going for an interview. Be careful, “what's in the showcase may not be in the store house many a times....” 

Ø  BRAND IMAGE

Brand image becomes important as that is the tag which adds value to your CV and earns you an immediate placement after becoming a Chartered Accountant. “Only this is”... This should not come at cost of your wide exposure.

Ø  CLIENTELE

If possible, get an idea from external sources as to what type of industry the firm is catering to. Seeing more and varied types of clients at your level is must. Make sure that you deep dive in their businesses models given an opportunity.

"Remember that a book should not be judged just by its cover......"

For eg : Listed Companies, Manufacturing clients, Banks, Corporates, Clients having ERP packages, etc.

Ø  HOW SHOULD YOU LOOK AT YOUR ARTICLESHIP PERIOD :

The articleship tenure has to be managed effectively amongst :

1 ) GMCS :

Believe me this is very crucial and only on campus training module available in the CA course. ICAI has been generous to offer this twice now. Doing this is in right spirit really helps.

• ·         GMCS - I which is to be done in 1st year of articleship.
• ·         Do not opt for GMCS Course during the peak season or when the work gets affected.
• ·         It should be a win-win situation for both i.e article as well as the firm.

2 ) College exams :

These remain just formality once you have joined CA course in my view. You are going to learn much more in CA than your syllabus at your graduation level. Don't be unnecessarily fussy about scoring everywhere at cost of losing your focus from CA.

• ·         For SYBCOM exams, take leave for only exam days or a few prior days are enough.
• ·         For TYBCOM exam, a probable 10-15 day leave (including exam days) might be enough for preparation.
• ·         Do not waste more on College exams, utilize the leave for CA Final exam.

3) Advanced ITT :

Important item again. Only issue with this is the training modules which are designed keeping in mind all India standards. You may have done certain things much before they are taught here. So... Try to extract more from the tutors... “If they are really good enough!!” :-(

• ·         It has to be done before CA final exam, which leaves you no choice but to do in your articleship period.
• ·         Appropriate period : In the months of June/July or October/November
• ·         Timings should be planned well in advance.

THE WHOLE THING REVOLVES AROUND "PRIORITY". MANAGE YOUR ARTICLESHIP TIME ON BASIS OF PRIORITY IN TERMS OF WORK, COURSES AND STUDIES.

Ø  SKILLSET TO BE ACHIEVED :

1) Learning:

• ·         Every small work is important and has to be given the equal amount of preference.
• ·         Be passionate about what you do.
• ·         Learn from everyone.
• ·         Ask questions, do not blindly follow what is told to you.
• ·         Share your learnings with others, it will enhance your knowledge.

2) Skills to be acquired:

• ·         Responsibility
• ·         Management of time.
• ·         Management of Resources
• ·         Management of People
• ·         Take leadership
• ·         Be updated about the things happening around you.
• ·         Communication skills have to be improved by effective and frequent communication with others.

3) Team Spirit:

• ·         Working in a team is more important than working individually
                                  "WORK WITH PEOPLE AND NOT AMONGST PEOPLE."
• ·         Work independently in a Team, but keeping in mind the subsequent co-ordination, achieving team's goal and ultimately the objectives of the firm.
• ·         Improve your area of Influence by working independently, BUT within a given framework.
• ·         Do not just focus on getting the work done or just what the boss says. Be independent.

4) Experiment:

• ·         You are in the learning phase, so experiment as much as you can.
• ·         Take people along with you in the experiment process. This results in growth.
• ·         Being stubborn and rigid to change leads to stagnation.

5) Other Activities:

• ·         Attend seminars and workshops.
• ·         Attend study sessions.
• ·         Prepare presentation and deliver speeches whenever there is an opportunity.
• ·         This will build confidence in you.

 

Stephen Covey says “Start with keeping end in your mind”.

Ultimately you are going to be a Chartered Accountant (CA) who is expected to know everything all the time. People may ask you tax questions even in a Public Toilet or a swimming pool and expect accurate answers. You will be considered as a “Trusted source” for things you have never thought of you will be :-) That's not all…. Employers / clients will also expect best available stuff from your table all the time “right in time”, no matter what price they have to pay you. This is the “RUNWAY” of your career's airplane. Keep optimum speed to take off!!

You may apply with our firm online.

v         BEST OF LUCK..!!! Write us back to arpit@apdoshi.com for more questions or drop a comment in the blog.

- ARPIT BURICHA

 - PANKIT SATRA  

Did you know: Here are 21 aspects which may miss your sight about taxation in India?

A lot is talked about the taxes in informal chats. We tend to read the highlights in the news papers and other articles. Stuff may look attractive or otherwise as that look and we may tend to take the planning decisions on that information. 

Mymuneemji lists out certain subtler things of glaring day to day Income Tax stuff that a Tax payer should keep in mind before. This may otherwise skip your reading and thereby render the decisions wrong. Read on....

1. You cannot claim tax benefits on payment of life insurance premium of your parents even if they are financially dependent on you.
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3. You can claim tax benefits for payment of life insurance premium under Section 80 C for your children even if they are not financially dependent on you.
4. You can pay medical insurance premium of your parents and claim tax benefits even if they are financially NOT dependent on you.
5. You can claim tax benefit of medical insurance premium for your child only if the child is financially dependent on you.
6. For one self occupied house property you can claim deduction in respect of interest upto Rs. 2 lacs per annum from 1^st of April 2015 onward (Before that Rs.1.5Lac) but in respect of let out property you can claim full interest paid.
7. You are entitled to claim interest on loan taken even from your relatives and friends for residential and commercial property.
8. Deduction under Section 80 C for repayment of home loan is available only for a residential house property.
9. You can claim deduction for payment of tuition fee for only two children under Section 80C. The deduction for tuition fee is not available for your spouse or siblings.
10. Interest accrued on NSC for each of the years except the last year is eligible for deduction under section 80 C even though no fresh investment is made in NSC during these years. 
11. New Tax benefit under section 80C for a girl child under Sukanya Samriddhi account scheme for the amount invested, interest accrued on deposits and withdrawal from the said scheme in accordance with the rules of the said scheme will be exempt from tax. This tax benefit is retrospective amendment with effect from assessment year 2015-16.   
12. Sec 80 D deduction in respect of health insurance premium limits have been increased applicable from F.Y 2015-16, from Rs. 15,000 to Rs.25,000 for person below 60 years and for senior and very senior citizen from Rs. 20,000 to Rs. 30,000.  For very senior citizen deduction is available even for medical expenditure upto Rs. 30,000, as getting a medical insurance is difficult at that age but this needs to be paid in cheque which SEEMS very UNPRACTICAL. 
13. Deduction under section 80DD/80U limits have been increased for persons with disability and severe disability applicable from F.Y 2015-16. For disability the limit increased from Rs. 50,000 to Rs. 75,000, and for severe disability from Rs. 1,00,000 to Rs.1,25,000.
14. Deduction under Section 80 E is available only to individual for entire amount of interest paid during the year and no tax benefit is available for repayment of principal amount of education loan. 
15. Sec 80 EE deduction allow such home buyers an additional deduction of interest for first time buyer state of Rs. 1,00,000 was to be claimed in A.Y 2014-15. If the limit is not exhausted, the balance may be claimed in A.Y 2015-16 if the loan is sanctioned between 1.4.13 to 31.03.14, and the loan amount should not be more than 25 lakh and value of house should not be more than 40 lakh.
16. 80G -100% deduction for National fund for control of Drug abuse, Swachh Bharat Kosh and Clean Ganga fund.
17. The holding period is 12 months for certain financial assets but for other class of assets it is 36 month to avail benefits of long term capital gains.
18. Allowance of balance 50% additional depreciation as per section 32(1)(iia) applicable from F.Y 2015-16, in case were additional depreciation@20% on new plant and machinery acquired and installed and machine used for a period below 180 days were qualified for half rate(10%) of depreciation, it is proposed to provide the balance 50% depreciation in the immediately succeeding previous year.
19. If you tender listed shares in the open offer, you have to pay tax even if you have held the shares for twelve months or more. But there is no tax liability on long-term capital gains arising from the sale of listed shares sold through broker of stock exchanges.
20. Normal short term capital gains is taxable at the slab rate applicable to you but tax on short term capital gains on sale of listed shares through stock broker is taxable @ 15% if security transactions tax (STT) is paid irrespective of your slab rate.
21. You can claim tax benefits of leave travel assistance (LTA) for your spouse, child, parents and siblings. Spouse and child may be financially independent but the parents and siblings have to be dependent on you. LTA benefits can be claimed in respect of two children only if born after 1st October 1998.
22. Advanced tax is not applicable for the tax payers under presumptive taxation regime. i.e., in small Retail or plying and hiring owning below 10 trucks or such others with a turnover below Rs. 1 Cr. 

5 Simple Steps for Advance tax Calculation – For Individuals

Advance Tax is applicable for all assesses whose Tax Liability exceeds Rs. 10,000/- during the financial year

Advance tax should be paid in various installments.

Some clue on "How to" of DIY Advance Tax calculation-Individuals

Advance calculation for individuals is like filing the return of income, therefore involves similar steps.

Steps Involved

Step-1            Form 26AS of the individual is to be taken into account for calculating income. Take all incomes into consideration shown in the form 26AS on which TDS is deducted. Such income may not be of the whole year while calculating advance tax, therefore has to be projected for the whole year while calculating Advance Tax. Remember to also take TDS credit on projected basis for the whole year.

Step-2 Now see if there is any other income of the assessee during the year by coordinating with the individual or by examining his bank statements. Also, take into account previous years incomes while considering incomes of this year (some incomes accrue every year therefore, have to be taken into account every time).The incomes in step-2 are those on which TDS is not deducted, therefore not shown in 26AS.

Step-3 See the investments of the assessee to project the deductions under chapter VI-A like 80C, 80G etc.

Step-4 Also keep an eye on the surcharge applicable where total income exceeds the limits specified for applicability of surcharge in case of companies/firms.

Step-5 Once this is done and the total income is projected, then apply tax rates as applicable in the financial year for which tax is deducted and project the advance tax.

Advanced Gyan on Advance Tax....

Advance Tax Provisions under the Income Tax Act’1961

1.  Advance Tax is applicable for all assesses whose Tax Liability exceeds Rs. 10,000/- during the financial year.

2.  Advance Tax is payable as follows:

Particulars	For Companies	For other than Companies
Up to 15th June of financial year	15% of Tax Payable	Not Applicable
Up to 15th September of financial year	45% of Tax Payable	30% of Tax Payable
Up to 15th December of financial year	75% of Tax Payable	60% of Tax Payable
Up to 15th March of financial year	100% of Tax Payable	100% of Tax Payable

Points to remember:-

1. Advance Tax provisions are not applicable in case of assesses having income under head Profits & Gains from Business or Profession U/s 44AD and 44AE i.e presumptive income.
2.      Advance Tax provisions are not applicable in case of senior citizens aged above 60 years, but if senior citizens have business income then Advance Tax provisions are applicable.
3.      Note above points are applicable for residents only i.e exemptions are available only for residents. No exemption for senior citizens if such individual is Non-resident.
4.      Advance Tax can be paid by challan ITNS 280 under the minor head code 100 and Major Head code is 0020 for tax on Companies and 0021 for Tax on other than Companies.
5.      Tax can be paid by challan either by cheque, cash or by the online mode.

Interest on Late Payment of Advance Tax

If the Income Tax is not paid as per the above schedule, Interest is liable to be paid for late payment of tax as follows

1.     Interest under section 234B – Interest @ 1% is payable if 90% of the tax is not paid before the end of the financial year i.e. for Default in Payment of Advance Tax

2.     Interest under section 234C – Interest @ 1% per month is payable if the tax is not paid as per the above schedule i.e. for Deferment in Installments of Advance Tax.