CU -BCOM-Sem VI -Tax assessment and procedure

 On the 'e-Verify' page, select 'I would like to verify using OTP on mobile number registered with Aadhaar' and click 'Continue'. A pop-up will appear on your screen. You will be required to select the tick box saying 'I agree to validate my Aadhaar details' and click on 'Generate Aadhaar OTP'.  Third option of verifying ITR is by generating Electronic Verification Code (EVC) via one's bank account. You must have a pre-validated bank account to be able to generate EVC. Do keep in mind that pre-validation of bank account is a must for receiving income tax refund.  The notification clarified that in case the e-verification of the ITR or hard copy ITR-V is sent through post beyond the time-limit of 30 days, the return shall be treated as late or beyond the due date.  \"The date of dispatch of speed post of duly verified ITR-V shall be considered for the purpose of determination of the 30 days period, from the date of transmitting the date of Income-tax return electronically,\" it said. 5.5 KEYWORDS  Refund paid- the refund should be received by you, either in your bank account or by a cheque as selected by you. In case of non-receipt of cheque, please track your speed post reference number on TIN website.  Not determined– Please confirm if your return is filed and duly verified.  No demand no refund– If as per IT department, you are not eligible for refund, then “no demand no refund “will be reflected. An intimation u/s 143(1) will be issued showing comparison of their calculation on your registered email. Review the comparison and rectify the return if required.  Refund unpaid– This status gets reflected due to error in bank or address details. Please update the correct details on income tax portal and raise a refund reissue request  Refund determined and sent out to the refunding banker- it means a refund request is generated and sent for processing. Refunds should be received within a few days. 5.6LEARNING ACTIVITY 1. Explain verification of return ___________________________________________________________________________ ___________________________________________________________________________ 101 CU IDOL SELF LEARNING MATERIAL (SLM)

2. What are the steps of verification of return ___________________________________________________________________________ ___________________________________________________________________________ 5.7 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1.What is verification of return? 2.What all should include under interest income? 3.If not filed ITR for past two years. Can we file now 4.Is it necessary to provide Aadhaar card details? 5.Is it necessary to provide Aadhaar card details? Long Questions 1.Why is there a tax due even after TDS was deducted? 2.What to do if I have filed an erroneous return? 3.How to know that ITR has been filed successfully? 4.How much time does it take for ITR verification? 5.How can I verify my return in net banking? B. Multiple Choice Questions 1. PAN is required to be quoted in the documents pertaining to deposit of cash with bank, if the aggregate amount of cash to be deposited in bank is Rs...…. or more. a. Rs.10,000 b. Rs.15,000 c. Rs.50,000 d. Rs.60,000 102 CU IDOL SELF LEARNING MATERIAL (SLM)

2. A person, who has not been allotted PAN, shall make declaration in Form No...…. while opening a bank account. a. Form No. 61 b. Form No. 15H c. Form No. 15G d. Form No. 60 3. The last character of PAN indicates …. a. Surname b. First name c. Middle Name d. Alphabetic Check Digit 4. Mrs. Deepali Patel, Indian citizen, 62 years of age can apply for PAN in form a. From 15H b. Form 15G c. Form 49A d. Form 60 5. Which of the following is a proof of Identify for applying PAN ? 103 a. Passport b. Voter Card c. Driving License d. All of these Answers 1-c, 2-d, 3-d, 4-d, 5-d 5.8 REFERENCES Reference books CU IDOL SELF LEARNING MATERIAL (SLM)

 The e Hardware Verification Language Paperback – Import, 10 April 2014 by Sasan Iman  Check Register Book: Check Book Register: An Accouting Verification and Recording Register. Paperback – 13 May 2021 by Kitty Susette (Author) Textbooks  Sap MM Invoice Verification : Technical Reference And Learning Guide Paperback – 29 December 2015 by Agrawal P. K. (Author)  Chaurasia,N and Chaurasia ,P (2011). Library Stock Management: A case study of Stock verification of Central Library, IIT Delhi. International Journal Website  https://taxguru.in/income-tax/income-tax-return-verification-company-llp-any-person- prescribed- cbdt.html#:~:text=Section%20140%20of%20the%20Act,company%20can%20verify %20the%20return.  https://incometaxmanagement.com/Pages/KnowledgeBASE/8/79-Section-140.html  https://taxmantra.com/authorised-signatories-for-filing-of-return-us-140/ 104 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT - 6PAN PROVISIONS STRUCTURE 6.0 Learning Objectives 6.1 Introduction 6.2 Provisions relating to mandatory allotment of PAN& Aadhar Number 6.3 Summary 6.4 Keywords 6.5 Learning Activity 6.6 Unit End Questions 6.7References 6.0LEARNING OBJECTIVES After studying this unit, you will be able to:  What is the purpose of PAN option?  What are the benefits of PAN card?  What do you understand by PAN?  What is the use of PAN card for students? 6.1 INTRODUCTION The Indian Income Tax Government issues a laminated \"PAN card\" with ten alphanumeric characters, known as a permanent account number (PAN), to any \"person\" who requests for one or to whom the department assigns the number without a request. Additionally, a PDF version of it is accessible. According to the Indian Income Tax Act,[1] 1961, every judicial entity must have a PAN, a special identification number. Section 139A of the Income Tax Act governs the issuance of the income tax PAN and the associated card. It is a crucial form of identification and is issued by the Indian Income Tax Department under the direction of the Central Board for Direct Taxes (CBDT). 105 CU IDOL SELF LEARNING MATERIAL (SLM)

A PAN card is not recognized as evidence of Indian citizenship since it is also granted to foreign people (such as investors) subject to a valid visa. For income tax returns to be filed, a PAN is required. Organization of PAN The PAN (or PAN number) is an alpha-numeric, ten-character unique identification code. The PAN structure looks like this: The fourth character is [P — Person or Person] as in AAAPZ1234C The first five characters are letters, which are automatically capitalized. The next four characters are numbers, and the last (tenth) character is a letter. The code's initial three characters are three letters that create an alphabetical sequence going from AAA to ZZZ. The kind of card holder is indicated by the fourth character. Each sort of holder is identified by a letter from the following list: A — AOP (Association of persons) B — BOI (Body of individuals) Company, or C F — Firm G: The government 106 CU IDOL SELF LEARNING MATERIAL (SLM)

H — HUF (Hindu Undivided Family) L — Local government J for fictitious juridical person Person (P) (Individual) T — Believe (AOP) The first character of any of these two is the fifth character of the PAN. a \"personal\" PAN card, where the fourth character is \"P,\" of the person's first name, last name, or surname; a company/HUF/firm/AOP/trust/BOI/local authority/artificial judicial person/government, where the fourth character is \"C\", \"H\", \"F,\" \"A,\" \"T,\" \"B,\" \"L,\" \"J,\" \"G\" of the name of the entity, trust, society, or organization. An alphabetic digit is used as a check-sum in the last (tenth) character to ensure that the present code is still valid. Provisions In recent years, if the PAN card was issued by NSDL, the DOI (date of issuance) is shown at the right (vertical) side of the picture; if it was issued by UTI-TSL, the DOI is not included. The federal government has launched a new online tool called \"Know Your PAN\" that allows you to check your PAN[3] for both new and current PAN numbers in addition to learning your PAN number. 107 CU IDOL SELF LEARNING MATERIAL (SLM)

If Section 139A of the Income Tax Act is not followed, a penalty of 10,000 is due to the assessing officer 014e under Section 272B for each failure. PAN uses The PAN's main goals are to provide all financial transactions a universal identity and to combat tax fraud by tracking financial transactions, particularly those of high-net-worth persons who have an influence on the economy. When submitting income tax returns, deducting taxes at source, or corresponding with the Income Tax Department in any other way, you must provide the PAN. PAN is also increasingly required in order to create new bank accounts, demat accounts, landlines or mobile phone connections, buy foreign currency, make bank deposits more than $50,000, buy and sell immovable property, automobiles, etc. How to get a PAN Similar to getting a passport, driver's license, Aadhaar, etc., getting a PAN is elective or voluntary. But when carrying out high-value financial transactions, etc., its usage is required. One may apply for a PAN by submitting the required PAN application to the district's authorized PAN agency or online via the NSDL website, UTI, together with 2 current passport-size color pictures, ID documentation, proof of address, and payment. A photocopy of the previous PAN is also necessary in the event of a reprint (reissue). The card takes 10 to 15 days to arrive. A user who has an Aadhaar card may submit an e-KYC as well. PAN for non-resident aliens PAN is a crucial document for foreign nationals who want to invest in India or do business there. The PAN application process is the same as that used for Indian nationals. However, the application must be made via the authorized agent in India using Form 49AA, which is 108 CU IDOL SELF LEARNING MATERIAL (SLM)

intended for foreign nationals, at any approved PAN Service Centre. The following is a list of papers that are required for foreign citizens: Human beings and HUF documents recognized as identification verification a copy of a voter ID card or a passport a duplicate of the Person of Indian Origin (PIO) card issued by the Indian government, a duplicate of the Overseas Citizens of India (OCI) card issued by the Indian government, In countries that have ratified the Hague Convention of 1961, a copy of another national identification number or taxpayer identification number that has been properly attested by \"Apostille\" or by the Indian Embassy, High Commission, or Consulate in the nation where the applicant is located, as well as by duly authorized representatives of overseas branches of Scheduled Banks registered in India (in prescribed format). Acceptable documents for proving your residence papers containing the applicant's address from the aforementioned forms of identification a replica of a bank statement from the nation where you now live, or a replica of an Indian non-resident external (NRE) bank account statement, or a replica of the state police authorities' residential permission or certificate of residency in India, a copy of the foreigner's registration office's registration certificate with the Indian address, or 109 CU IDOL SELF LEARNING MATERIAL (SLM)

Copies of the visa approval letter, the contract or letter of employment from an Indian business, and the employer's original certificate certifying the Indian address. Other than for people and HUF (including those having no office of their own in India) documents recognized as identification and address evidence a copy of the applicant's country of residence's official certificate of registration, duly attested by \"Apostille\" (in the case of Hague Convention signatories) or by the Indian Embassy, High Commission, or Consulate in that country, or by duly authorized representatives of overseas branches of Scheduled Banks registered in India (in the format required); a copy of the registration certificate obtained in India or the authorization from Indian authorities to open an office there. PAN Service Centers are now only found in India. However, international nationals can find the pretended online application process more cumbersome. The NSDL PO Box in Pune (India) or the UTIITSL address in Mumbai, New Delhi, Chennai, or Kolkata must receive signed physical papers that have been received through postal mail or courier. The online payment option enables foreigners to pay fees in INR using a small selection of credit cards (only if they have India based credit card as international credit cards are not always accepted by the third-party fee collectors.) India charges a price to issue a TIN, in contrast to most other nations (PAN ID). The costs are 107 rupees if the PAN card is to be obtained in India and 989 rupees if it is to be obtained abroad. Keep in mind that the online application simply gets rid of data entering mistakes. To the India-based facilities, the application and images must still be sent. Two photos are required for the application. The box underneath the one on the top right has to be signed. The other in the upper left corner requests a signature all the way across the image (such that part of the signature is on the photograph and part on the form). Your papers arrive at the centre somewhere between 2 and 20 days later than the day- long initial processing and verification. Within 48 hours, the tax authority will really issue a PAN number. Following the issuance of the PAN number, which is first communicated by email, the real PAN card is delivered to the abroad location via registered or certified mail, which may take a further two weeks. 110 CU IDOL SELF LEARNING MATERIAL (SLM)

As of March 31, 2019, 445 million authentic PANs have been issued, even though India only has 58 million income tax filers. Even though each PAN card has a different alphanumeric PAN number, individuals and businesses have been able to illegally get several PAN cards. Multiple PAN acquisition is prohibited and punishable by a fine of 10,000 (US$130) if discovered. Due to the prevalence of plastic card printers, there are also phoney PAN cards. Additionally, PAN cards have been provided to illegal immigrants; the majority of them have utilized PAN card agents. Only two organizations, NSDL e-Governance & UTIITSL, are permitted to receive PAN applications for processing on behalf of the Income Tax Department (India). 6.2 PROVISIONS RELATING TO MANDATORY ALLOTMENT OF PAN& AADHAR NUMBER The transactions listed below are those in which everyone, save the Central Government, State Governments, and Consular Offices, must quote their PAN: 1) The sale or acquisition of a motor vehicle or a vehicle with more than two wheels. 2) Opening an account with a banking business or a cooperative bank (other than the time- deposit mentioned at No. 12 and a Basic Savings Bank Deposit Account). 3) Filling out an application to get a debit or credit card. 4) Opening a demat account with SEBI with a depository, participant, securities custodian, or any other entity. 5) Paying a hotel or restaurant more than Rs. 50,000 in cash at once in exchange for a bill. 6) Paying more than Rs. 50,000 in cash to go abroad or to buy more than Rs. 50,000 worth of foreign currency in a single transaction. 7) Making a payment to a mutual fund for the acquisition of more than 50,000 rupees' worth of its units. 8) Giving a corporation or organization more than Rs. 50,000 in exchange for bonds or debentures they have issued 9) Making a payment to the Reserve Bank of India in excess of Rs. 50,000 in order to purchase bonds the bank has issued. 10) Cash deposits with a financial institution or a cooperative bank that exceed Rs. 50,000 on any single day. 10A) Cash deposits made with a bank, cooperative bank, or post office between November 9 and December 30, 2016, totaling more than Rs. 2,50,000. 111 CU IDOL SELF LEARNING MATERIAL (SLM)

11) The payment of more than Rs. 50,000 in cash on any one day for the acquisition of bank draughts, pay orders, or banker's checks from a banking organization or a cooperative bank. 12) A time deposit with one of the following institutions throughout a financial year that exceeds 50,000 rupees or totals more than 5 lakh rupees: a post office, a nidhi as defined in section 406 of the Companies Act of 2013, or a non- banking financial firm, among others. 13) Payment of one or more pre-paid payment instruments, as defined in the policy guidelines for the issuance and operation of pre-paid payment instruments issued by the Reserve Bank of India under section 18 of the Payment and Settlement Systems Act, 2007, to a banking company, a co-operative bank, or to any other company or institution, for an amount totaling more than Rs. 50,000 in a financial year. 14) Paying an insurer a sum of more than Rs. 50,000 as a life insurance premium in a fiscal year 15) An agreement to sell or buy securities (other than shares) for more than Rs. 1 lakh in a single transaction 16) Any sale or acquisition of shares of a corporation not listed on a recognized stock exchange by a person for more than Rs. 1 lakh in a single transaction. 17) Any moveable property that is sold or purchased for more than Rs. 10 lakh or that is evaluated by the stamp valuation body mentioned in Section 50C of the Act for more than Rs. 10 lakh. 18) The sale or acquisition of any products or services other than those listed above for more than Rs. 2 lakh in a single transaction. NOTE: 1) If a minor does not have any income subject to income tax, he may use the PAN of his parent or guardian. 2) Anyone who engages in any of the aforementioned transactions but does not have a PAN may declare this in Form No. 60. 3) A non-resident is not needed to quote their PAN in a transaction mentioned in points No. 3, 5, 6, 9, 11, 13, or 18. 4) Anyone who maintains an account with a banking business or a cooperative bank (other than a time deposit mentioned at point no. 12 and a basic savings bank deposit account). If he did not mention his PAN or provide Form No. 60 at the time the account was opened or thereafter, he will be obliged to do so on or before June 30, 2017. 112 CU IDOL SELF LEARNING MATERIAL (SLM)

The addition of Section 139AA took place as of April 1, 2017. Below are the provisions of this section: Category-A: Quoting an Aadhaar Number Eligible Person [Section 139AA(1)]: On or after 1.7.2017, everyone who is eligible to receive an Aadhaar number must quote their Aadhaar number— in the application for PAN assignment (Permanent Account Number;) in the income tax return: The Enrolment ID of the Aadhaar application form supplied to him at the time of enrolment must be referenced in the application for a permanent account number or, as the case may be, in the return of income provided by the person in cases where they do not have an Aadhaar number. Category-B: Aadhaar Number Intimation Eligible Person [Section 139AA(2)]: Every person who had a permanent account number as of 1.7.2017 and was eligible to get an Aadhaar number must notify that authority of their Aadhaar number in the format and manner specified by the authority, on or before the date that will be announced by the Central Government in the Official Gazette. The permanent account number allocated to the person will be declared invalid and the other provisions of this Act will apply as if the person had not requested for allocation of a permanent account number in the event that the Aadhaar number is not provided. When Section 139AA Provisions Do Not Apply to Specific Persons or a State [Section 139AA(3)]: The provisions of this section shall not apply to any person, class of people, State, or portion of a State, as may be specified by notification published in the Official Gazette (See Notification No. 37/2017 in the box below) in this regard by the Central Government. Notice No. 37/2017, dated May 11, 2017. The Central Government hereby notifies that, in accordance with the authority granted by sub-section (3) of section 139AA of the Income-tax Act, 1961 (43 of 1961), the provisions of 113 CU IDOL SELF LEARNING MATERIAL (SLM)

section 139AA do not apply to anyone who does not have an Aadhaar number or an Enrolment ID and who is any of the following: dwelling in the states of Assam, Jammu and Kashmir, and Meghalaya; not being an Indian citizen; being a non-resident under the Income-tax Act, 1961; and being at least 80 years old at any point in the preceding year. `6.3 SUMMARY  The Income Tax Government will provide each \"person\" who applies for a Permanent Account Number (PAN), or to whom the department assigns the number without an application, a ten-digit alphanumeric number in the form of a laminated card.  PAN gives the department the ability to connect all of the \"person's\" transactions to the department. These deals include taxes.  payments, TDS/TCS credits, income/wealth/gift/FBT returns, specific transactions, communication, etc. PAN serves as the \"person's\" identification with the tax department.  PAN was created to enable easy retrieval of information and to enable matching of information relating to investments, loan raising, and other business activities of taxpayers collected through various sources, both internal and external, for detecting and combating tax evasion and expanding the tax base. These documents include payment of taxes, assessments, tax demands, tax arrears, etc. relating to an assessee.  PAN must be used in all interactions with income tax authorities and on tax returns. From January 1, 2005, all challans for payments to the Income Tax Department must include the PAN.  The Income Tax department has given National Securities Depository Limited (NSDL) permission to provide PAN services from TIN Facilitation Centers and UTI Investor Services Ltd (UTIISL) permission to establish and manage IT PAN Service Centers in all cities and towns where there is an Income Tax office in order to improve PAN-related services. UTIISL has established many IT PAN Service Centers and multiple TIN Facilitation Centers for the convenience of PAN applicants in large cities. 6.4 KEYWORDS  Permanent Account Number (PAN)- 114 CU IDOL SELF LEARNING MATERIAL (SLM)

PAN is a ten-digit alphanumeric number, issued in the form of a laminated card, by the Income Tax Department, to any \"person\" who applies for it or to whom the department allots the number without an application.  Tax provision- Simply put, a tax provision is the estimated amount of income tax that a company is legally expected to pay to the IRS for the current year. A tax provision is just one type of provision that corporate finance departments set aside to cover a probable future expense  SEBI- Securities and Exchanges Board Of India (SEBI) is one of the most significant regulatory body responsible for managing the securities market in India. SEBI was set up with the intent of preserving the interest of investors who invest in the securities market and to encourage the development and growth of the securities market.  Income tax- Income tax is a direct tax that a government levies on the income of its citizens. The Income Tax Act, 1961, mandates that the central government collect this tax. The government can change the income slabs and tax rates every year in its Union Budget. Income does not only mean money earned in the form of salary.  Apostille- An \"apostille\" is a form of authentication issued to documents for use in countries that participate in the Hague Convention of 1961. A list of countries that accept apostilles is provided by the US State Department. 6.5 LEARNING ACTIVITY 1. Full form of PAN? ___________________________________________________________________________ ___________________________________________________________________________ 2. What are PAN provisions? ___________________________________________________________________________ ___________________________________________________________________________ 115 CU IDOL SELF LEARNING MATERIAL (SLM)

6.6 UNIT END QUESTIONS 116 A. Descriptive Questions Short Questions: 1. What is the use of PAN card for students? 2. What is PAN and its features? 3. What is PAN application type? 4. What does 4th letter in PAN stands for? 5. What does 1st letter in PAN stands for? Long Questions: 1. What is the purpose of PAN option? 2. What are the benefits of PAN card? 3. What do you understand by PAN? 4. How to know PAN if the PAN card is lost and PAN is forgotten 5. Penalty for not complying with provisions of PAN B. Multiple Choice Questions 1. Arrange the sequence of e-payment procedure. (i) Enter its PAN/TAN as applicable (ii) Select the relevant challan (iii) Visit www.tin-nsdl.com (iv) Click on the link for ‘e-payment; Pay Taxes Online’ a. i, ii, iii, iv b. iii, iv, ii, i . c. i, ii, iv, iii d. iv, iii, ii, i 2. The last character of PAN indicates .......... CU IDOL SELF LEARNING MATERIAL (SLM)

a. first name b. Check digit . c. Surname d. Middle name 3. Amount of unabsorbed depreciation can be carried forward for .......... a. 4 years b. 8 years . c. zero year d. unlimited number of years 4. Which of the following is true for rebate under Section 87A for the assessment year 2018- 19 of the Income Tax Act, 1961. a. The amount of rebate is 100 percent of income-tax or Rs.2,000 whichever is higher b. The amount of rebate is 100 percent of income-tax or Rs.2,000 whichever is less. c. The amount of rebate is 100 percent of income-tax or Rs.5,000 whichever is higher d. The amount of rebate is 100 percent of income-tax or Rs.5,000 whichever is less 5. PAN is required to be quoted in the documents pertaining to deposit of cash with bank, if the aggregate amount of cash to be deposited in bank is Rs. ....... or more. a. Rs.10,000 b. Rs.1,00,000 c. Rs.50,000 . d. Rs.30,000 Answers 1-b, 2-b, 3-b, 4-b, 5-c 117 CU IDOL SELF LEARNING MATERIAL (SLM)

6.7 REFERENCES Reference books  Taxmann's Commentary Combo for Direct Tax Laws | Master Guide to Income Tax Act & Rules and Direct Taxes Ready Reckoner (DTRR) | Set of 3 Books | Finance Act 2022 Edition | A.Y. 2022-23 & 2023-24 Product Bundle – 7 April 2022 by Taxman (Author), Vinod K. Singhania (Author)  Taxmann’s Handbook on Taxation of Partnership Firms & LLPs: FAQs – The one-of-a- kind book covering 360 FAQs, exhaustively dealing with Section 9B & 45(4) of the Income-tax Act along with Case Studies Paperback – 30 December 2021 by Dr K. Shivaram (Author), Adv. Shashi Ashok Bekal (Author)  Master Guide To Income Tax Rules | 2022 | Virtual Book Taxmann  Tax-Free Wealth: How to Build Massive Wealth by Permanently Lowering Your Taxes (Rich Dad Advisors) Paperback – 26 May 2015 by Tom Wheelwright (Author) Textbooks  How to Pay Zero Taxes, 2020-2021: Your Guide to Every Tax Break the IRS Allows Paperback – Import, 17 January 2020 by Jeff A. Schnepper (Author)  J.K. Lasser′s 1001 Deductions and Tax Breaks 2019: Your Complete Guide to Everything Deductible Paperback – Import, 18 January 2019 by Barbara Weltman (Author)  Federal Income Taxation (Aspen Casebook) Hardcover – 17 August 2018 by Richard Schmalbeck (Author), Lawrence Zelenak (Author), Sarah B. Lawsky (Author)  Corporate Taxation (Examples & Explanations) Paperback – Import, 23 December 2009 by Cheryl D. Block (Author) Website  https://www.incometaxindia.gov.in/tutorials/1.permanent%20account%20number%20 (pan).pdf  https://taxguru.in/income-tax/permanent-account-number-pan.html  https://www.caclubindia.com/forum/provisions-regarding-pan-permanent-account- number-in-india-170616.asp 118 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT - 7TRP STRUCTURE 7.0 Learning Objectives 7.1 Introduction 7.2 Tax Return Preparer (TRP) 7.3 Sec 140A Self-Assessment Tax 7.4 Method of Accounting u/s 145 7.5 Summary 7.6 Keywords 7.7 Learning Activity 7.8 Unit End Questions 7.9 References 7.0LEARNING OBJECTIVES After studying this unit, you will be able to:  Understand sec 140A self-assessment tax  Understand what is the community discussion forum?  Understand who manages the TRP?  Understand who can use the TRP? 7.1 INTRODUCTION The Income Tax Act, 1961, and any subsequent changes thereto govern the assessment, management, collection, and recovery of income tax in India. However, while taking into account the number of PAN cards that are currently active in India, India has one of the lowest numbers of ITR filers. The Income Tax department established the (Tax Return Preparer) TRP programme, in which government-approved persons are educated to assist taxpayers in filing their income tax returns, in order to address this issue and make tax filing simpler for Indians from all socioeconomic backgrounds. A tax return preparer (TRP) is a person. 119 CU IDOL SELF LEARNING MATERIAL (SLM)

A Tax Return Preparer (TRP) is a person qualified to help taxpayers file their income tax returns and who has been authorized by the Income Tax Department. A TRP has the necessary abilities to assist people in filing their tax returns in exchange for a small fee, but they are not obliged to be tax attorneys or chartered accountants. TRPs do, however, have one significant drawback: in situations when a tax audit is necessary or requested, they are not permitted to help file returns under current regulations. What a tax return preparer does  The primary responsibilities of a tax return preparer are summarised in the list below:  preparing a taxpayer's income tax return.  submitting the tax return that has been produced and has been validated by the resource centre to the appropriate Assessing Officer or relevant agency.  obtaining a copy of the IT department's acknowledgment on the taxpayer's behalf. This record serves as evidence that the tax return was submitted.  On or before the 7th of every month, submit a statement of details to the Resource Center.  keeping track of key information about each tax return they completed during the most recent assessment year as well as prior assessments. Important Information Mentioned in Tax Return Preparer Records  A TRP is required to save the following information for each and every income tax return filing they help with:  The taxpayer's name for whom they are producing returns 120 CU IDOL SELF LEARNING MATERIAL (SLM)

 The taxpayer's Permanent Account Number (PAN)  Assessment Year  The assessee's total income for which the TRP is submitting an ITR  The total tax that the taxpayer must pay  the day on which the tax return was submitted  The acknowledgment code included on the acknowledgment slip given after ITR verification  The Assessing Officer's authority  TRP fees for different services accessed via the TRP programme Using the income tax website, how to locate a TRP A TRP may be located in one of four ways:  Utilize the \"Locate a TRP\" option on the official TRPS website to get the contact information for TRP.  Using the TRPS website, you may sign up for a home visit from a tax return preparer.  To contact a TRP, call the helpdesk at 1800-10-23738.  To get a TRP, send an email to [email protected]. 121 CU IDOL SELF LEARNING MATERIAL (SLM)

7.2 TAX RETURN PREPARER (TRP) The Tax Return Preparer Scheme, often known as TRP, is essentially a service for timely tax filing. The Income Tax Department successfully implemented this plan to make the procedure of filing taxes for the taxpayer simpler and easier. The Income Tax Department developed the TRPS or Tax Return Preparer Scheme, a tax filing service that provides tax filing services right to the taxpayer's door. For a nominal price or for free, the service provides small and marginal taxpayers with assistance in preparing and completing their tax returns by qualified experts trained by the Income Tax Department. Targets of the TRPS The government created the Tax Return Preparer Scheme to accomplish the following goals: Give graduates who are jobless or just part-time employed work Reduce the expenses of compliance for small taxpayers broaden the tax base Increase public understanding of tax laws Encourage community involvement Who are TRPs? Tax Return Preparers (TRPs) are experts who have been educated by the Income Tax Department to help taxpayers file their returns while doing so in the convenience of their own homes. TRPs won't be allowed to submit tax returns however if a tax audit is required. How can I schedule a meeting with a TRP? In order to schedule a meeting with a TRP, taxpayers should go to the TRP website (trpscheme.com). You may choose to use the services of the appropriate TRP according on the city in which you live. 122 CU IDOL SELF LEARNING MATERIAL (SLM)

You may schedule an appointment by emailing [email protected] or phoning the hotline at 1800-10-23738. What Fees Does a TRP Charge? Due to the fact that TRPs are paid directly by the Income Tax Department, they often assist individuals in filing their taxes for free. Their compensation is based on how much tax you must pay. For the first year (up to a maximum of Rs. 1,000), TRPs will get 3% of the tax paid on the returns produced and submitted for each new assessee, followed by 2% for the second year and 1% for the third year. The cost is Rs 250 after the fourth year. Mission of a TRP The responsibilities of a tax return preparer include the following: Due diligence must be considered when preparing the return. His or her signature is required on the prepared return. Send the return to the appropriate Assessing Officer or a relevant organization that the Resource Center has indicated. Obtain an acknowledgement copy, which serves as evidence that the return was submitted. The TRP is required to keep a record of certain information on any returns he prepares. These specifics need to include the following: The individual's name for whom the TRP has prepared returns The PAN number of the assessee The assessment's year 123 CU IDOL SELF LEARNING MATERIAL (SLM)

The day the return was delivered or submitted The identification number on the acknowledgment slip the authority of the evaluating officer The total amount of income reported in the return The entire amount of taxes due The whole amount of taxes that must be paid Any sum pertaining to any fees and charges owed to the TRP in accordance with the Scheme's provisions. delivering a statement of specifics to the Resource Center by the seventh of every month or earlier The steps to use a TRP's services are as follows. The following steps must be taken by the taxpayer in order to use a tax return preparer's services: first, go to the TRPS website. Visit the area marked \"Register for Home Visit.\" In accordance with this initiative, the TRP will help the taxpayer by assisting them in filing their returns at their home. If you want to have the TRP visit you at home, you will need to specify the kind of help you need as well as a day and time for the TRP to come by. 124 CU IDOL SELF LEARNING MATERIAL (SLM)

Once this is completed, the support desk will locate the nearest TRP in your region and let you to schedule an appointment over the phone. 7.3 SEC 140A SELF ASSESSMENT TAX 1. Self-Assessment Section 140A Provisions The following are the stipulations of section 140A: 1. Before filing a Return of Income under the following: Section 139, Section 142(1), Section 148, or Section 153A, among others is required to undertake a self-assessment of his income and, if necessary, pay the self- assessment tax after accounting for any taxes that have already been paid. If the assessee delays in filing the return or makes a mistake with or fails to pay the advance tax, the assessee will be responsible for paying the tax due as well as any applicable interest and fees. 2. He must determine if any tax, interest, or charge is owed before filing the aforementioned return. Tax, interest, and/or fees must be computed as follows for this purpose: 3. Before completing an income tax return, the assessee must deposit the self-assessment tax that has been decided. All corporate assessees and other assessees (who are subject to a 125 CU IDOL SELF LEARNING MATERIAL (SLM)

mandatory audit under section 44AB) must submit electronic tax payments starting on April 1, 2008, using an online banking service provided by accredited banks. These taxpayers also have the option to pay their taxes electronically online using credit or debit cards. 4. The income tax return must be filed with the evidence of deposit (i.e., BSR code of bank, Serial No. of challan, amount of deposit and date of deposit). 5. If the amount paid by the assessee is less than the total of tax, interest, and fee as calculated above, the amount paid should first be applied to interest and fee due, and the remaining amount, if any, shall be applied to tax payable. Other considerations - The following should be kept in mind as well: Any sum paid under section 140A will be regarded to have paid towards such regular assessment after an income assessment has been performed on a regular basis. Without limiting any other repercussions he may face, any assessee who fails to pay all or any portion of the tax, interest, or fee in accordance with section 140A's requirements will be deemed to be in default and subject to all of the Act's provisions in relation to the unpaid tax, interest, or fee. 2. Self-Assessment Procedure and Determination of Self-Assessment Tax Liability: Tax Responsibilities for Self-Assessment The steps below describe how to calculate your self-assessment tax burden for your income tax return: Determine the whole income; Determine the amount of tax due based on the total income and the current rates; if appropriate, add a premium to the calculated tax; 126 CU IDOL SELF LEARNING MATERIAL (SLM)

Add the SHEC at 1% and the education chess at 2%; Add the following to the tax due when step (4) is completed: any concession granted under section 89; any tax reduction or deduction based on taxes paid outside of India that is made according to Section 90 or Section 91; any tax relief sought under Section 90A for taxes paid in any of the aforementioned listed territories outside of India; any tax credit sought to be offset in line with section 115JAA's (MAT credit) or section 115JD's (AMT credit) rules; any tax withheld from or collected at source; and any taxes, if any, that have previously been paid under this Act's provisions, such as advance taxes; To the Net-tax determined at step (5), add the following interest and fees that are due: When a return is filed late under Section 234A, interest is charged on the tax due on the entire amount of income reported on the return, less the amount of— advance tax paid, if any; any tax deducted or collected at source; any tax reduction or deduction based on taxes paid outside of India that is made according to Section 90 or Section 91; 127 CU IDOL SELF LEARNING MATERIAL (SLM)

any tax relief sought under Section 90A in connection with taxes paid in any of the aforementioned designated territories outside of India; and any claimed tax credit must be offset in line with section 115JAA or section 115JD rules. Interest under Section 234B is calculated on the amount by which the advance tax paid falls short of the assessed tax, or, as the case may be, on the amount equivalent to the assessed tax. See point 2 in the box for the definition of assessed tax; Interest on the advance tax deferral (under section 234C); charge for failure to provide a timely income tax return as required by section 234F (applicable for return of income furnished for the assessment year commencing on or after 1.4.2018). Before submitting an income tax return, the aforementioned tax, interest, and fee due should be paid as self-assessment tax. 1. Interest under paragraph (vi)(a) and (b) above shall only be payable for the self-assessment requirements of section 140A. It differs from what is due under sections 234A or 234B, however. The tax on total income calculated under section 143(1) or regular assessment under section 143(3) or 144, as reduced by TDS/TCS, advance tax paid, relief under section 90, 90A, or 91, and MAT credit under section 115JAA or 115JD, is subject to interest under section 234A. As opposed to section 140A, which requires payment of the tax based on the entire income reported in the return less TDS, advance tax, relief, etc. 2. Similarly, the definition of assessed tax for purposes of section 140A differs from that provided under section 234B with regard to interest due under paragraph (6)(ii) as per section 234B above. For the purposes of this section, \"assessed tax\" refers to the tax on the whole amount of income reported in the return, less— tax deducted or collected at source in accordance with Chapter XVII's requirements on any income subject to such deduction or collection and included in calculating such total income; 128 CU IDOL SELF LEARNING MATERIAL (SLM)

b. any tax reduction or deduction sought under Sections 90 or 91 in relation to taxes paid outside of India; c. any tax relief sought under Section 90A in connection with taxes paid in any of the designated territories outside of India mentioned in that Section; and d. any tax credit that is allegedly to be offset in line with section 115JAA or 115JD rules. 3. The sections 139(1), 139(3), 139(4), 139(4A), 139(4B), 139(4C), 139(4D), and 139 make up Section 139. (5). 4. The self-assessment tax return must be submitted with proof of payment. 5. The amount paid by the assessee as self-assessment tax shall first be adjusted towards the interest and fee payable and the balance, if any, shall be adjusted towards the tax payable when the amount paid by the assessee as self-assessment tax is less than the total of the tax and the interest (the word \"fee\" also inserted in case of return furnished for A.Y. 2018-19 and onwards) calculated at step No. (7) above. 6. The tax paid on self-assessment will be applied to the \"tax payable\" under normal assessment. 7.The self-assessment tax collected under Section 143 will be applied to the \"tax owing\" under a normal assessment. On the other hand, this tax does not become refundable if a routine assessment is unsuccessful. Only the amount paid in excess of the tax due on the assessee's total returned income is refundable in cases where the assessment is vacated. (B) Self-Assessment Tax Return Procedure The assessment procedure starts whenever the assessee sends their income tax return to the income-tax department. Even if the assessee was obligated to file a return of income, the assessment may sometimes be pursued by the Assessing Officer. Any of the following methods may be used by the Assessing Officer to make the assessment: 129 CU IDOL SELF LEARNING MATERIAL (SLM)

I Summary Assessment/Return processing to determine if tax is refundable or payable based on the income return [section 143(1)]. (ii) Scrutiny and Evaluation based on the receipt of further proof and the return of income [ 143(3)]. Best judgement evaluation (iii) Regarding section 144 7.4 METHOD OF ACCOUNTING U/S 145 The method of accounting used by the individual taxpayer is outlined in Section 145 of the Income Tax Act of 1961. Certain standards, referred to as the systems of accounting, are created to maintain a consistent procedure of documenting the revenue, spending, assets, and liabilities of every firm. There are two categories for accounting techniques: Cash Approach When there is a cash influx or outflow, that is the time a transaction is recorded in the books of accounts. Cash flowing in is referred to as cash inflow, while cash leaving the country is referred to as cash outflow. Mercantile Approach When an income or cost accrues, a transaction is documented. Regardless of whether currency is received or paid, the transactions are documented using this approach. 130 CU IDOL SELF LEARNING MATERIAL (SLM)

Article 145(1): Profits and profits from business or profession, as well as income from other sources, must be calculated using the method of accounting that the assessee normally uses: The computation shall be made on such basis and in such a manner as the Assessing Officer may determine in any case where the accounts are correct and complete to the satisfaction of the Assessing Officer but the method employed is such that, in the Assessing Officer's opinion, the income cannot properly be deducted therefrom: Furthermore, any income received in the form of interest on securities will be taxed as income from the prior year in which it is due to the assessee if no regular system of accounting is used by the assessee: Furthermore, nothing in this sub-section will prevent an assessee from having interest on securities received by him in a prior year that was not previously subject to income tax from being charged to income-tax for that previous year. According to Section 145(1), income taxable under the headings \"Profits and gains of business or profession\" or \"Income from other sources\" must be calculated using either the cash or mercantile method of accounting that the taxpayer normally uses. Some assessees use a hybrid way of accounting, which includes both the cash method and the mercantile technique but does not calculate income accurately. The assessees are no longer permitted to adopt the mixed technique. Either the Cash Method or the Mercantile Method must be used. Provision 1: The assessing officer will calculate income using the accounting technique of his choosing where the accounts are accurate and complete but the accounting method used does not compute accurate income. Provision 2: In the event that an assessee does not use a regular method of accounting, his income will be determined using the method of accounting used during the previous fiscal year. Provision 3: Even if a person gets interest on a security that hasn't been charged in previous years, it doesn't guarantee that he won't be in this year. Article 145 (2) 131 CU IDOL SELF LEARNING MATERIAL (SLM)

The Central Government may sometimes publish in the Official Gazette notifications on accounting standards that any class of assessees or in relation to any type of income must adhere to. Article 145 (3) If the Assessing Officer is not satisfied with the accuracy or completeness of the assessee's financial statements, or if the assessee has not consistently adhered to the accounting standards announced under subsection (1) or section (2), the Assessing Officer may make an assessment in accordance with section 144. The following inconsistencies allow the evaluating officer to reject the books of accounts: Ineffective Accounting Technique No accounts were produced for verification. Not producing records faulty accounts Lack of stock register upkeep The Assessing Officer must make the best decision that complies with all the requirements of Section 145 of the Income Tax Act 1961 after rejecting the books of accounts owing to dissatisfaction with the accuracy of the accounts supplied by the assessee. Important Information Regarding the Rejection of Books of Account 1. A chance for the assessed The Assessing Officer must provide the Assessee a chance to refute any evidence used by the Assessing Officer to reject the books of account. 132 CU IDOL SELF LEARNING MATERIAL (SLM)

2. Profit estimation After the assessee's books of account are disregarded, profit must be calculated using the correct material that is at hand; nevertheless, he is not permitted to estimate profit based only on speculation or on any accessible proof or material. 3. Calculated turnover Two important elements that have an impact on the evaluation are the estimated turnover and the fixed gross profit rate. The assessee has a right to know the basis and to be given the chance to contest it if they are set or calculated in a manner that is detrimental to his case. 4. Maximum credit Peak Credit cannot be determined by using rejected account books. After rejecting the books of accounts that the assessee provided, the income tax officer estimates the assessee's business revenue since it is not feasible for the officer to calculate the Peak credit using such records of accounts. 5. Using the Valuation Officer's Name In order to determine the worth of any asset, property, or investment for the purposes of assessment or reassessment, the Assessing Officer may refer the matter to a Valuation Officer. Only after rejecting the books of accounts may he get a copy of the valuation officer's report. 6. Assessing gross earnings from previous years. It is the assessee's responsibility to explain and justify the causes of any sudden, significant losses to his firm. Even if the Assessing Officer later finds the information provided by the Assessee to be incorrect in light of the comparative statement of accounts from the prior years, he cannot continue to make modifications to the accounts based only on speculation. He can only act if he refers to some information in the records or proof. ? If the assessee's return's profit figure is rejected, the taxation authorities will have to establish that the assessee really earned more money. The mere fact that the assessee's gross profit during the relevant period is low in comparison to the book results of prior years cannot support the rejection of books of accounts under Section 145(3). Similar to this, the assessee's accounting method cannot be disregarded solely because the total profits reported in his books were modest when compared to those of competitors in the same industry. 7. An estimate of revenue or profit The revenue must be assessed once the books have been correctly rejected, and while doing so, the best record as well as other items will become significant information. 133 CU IDOL SELF LEARNING MATERIAL (SLM)

8. Judicially exercisable power The Assessing Officer's right to reject the books of accounts must be used in a legal proceeding. The evidence that supported the Assessing Officer's decision about the accuracy or completeness of the Assessee's accounts or the system of accounting used by it must be included in the record. 9. First Appellate Authority's Power It is a well-established legal principle that the Commissioner of Income Tax (Appeals) utilizes all the authority granted to the Assessing Officer to wield when drafting the assessment order during the appeal processes. Therefore, the Commissioner (Appeals) may, provided that all other circumstances exist warranting rejection of such books of accounts, reject the assessee's books of accounts by first using the requirements of Section 145(3) of the Act when formulating the appeal judgement. 10. No implication Any evidence that the Assessing Officer uses to reject the books of account should not be assumed to be reliable. He must examine it carefully from every angle before rejecting it. 11. The Assessee's Defense The Assessing Officer has the right to reject the books of account if the justification offered by the assessee is deemed unsatisfactory by him. How does Section 145A work? For the purpose of calculating the income taxable under the subject \"Profits and profits of business or profession,\" regardless of anything to the contrary provided in section 145, the value of purchases and sales of goods and inventories shall be determined by (a) in conformity with the ordinary accounting system the assessee uses; and (b) further modified to take into account any tax, duty, cess, or charge (by whatever name called) that the assessee really paid or spent to get the items to the location and condition they were in as of the valuation date. Clauses in Section 145A 134 CU IDOL SELF LEARNING MATERIAL (SLM)

For calculating the income subject to taxation under the heading \"Profits and Gains of Business or Profession\": i. The net realizable value calculated in line with the income calculation and disclosure rules announced under subsection (2) of section 145 should be used as the basis for valuing inventory, if it is lower than actual cost. ii. Any tax, duty, cess, or charge that the assessee really paid or spent to get the goods or services to their location and condition as of the valuation date must be included to the valuation of purchases and sales of goods and services as well as inventories. Securities in the inventory that are not listed on a recognized stock exchange or that are listed but are not regularly quoted on a recognized stock exchange must be valued at real cost when they are first recognized in line with the income calculation and disclosure rules. iv. In accordance with the income calculation and disclosure criteria announced under subsection (2) of section 145, the inventory that consists of securities other than those mentioned in paragraph (iii) should be valued at the lower of actual cost or net realizable value. Paragraph 145B The three subsections of section 145B are often referred to as 145B(1), 145B(2), and 145B. (3) the clause in Section 145B (1) The interest earned by an assessee on any compensation or on increased compensation, as the case may be, must be regarded to be the income of the prior year in which it is received, notwithstanding anything to the contrary provided in section 145. the clause in Section 145B (2) 135 CU IDOL SELF LEARNING MATERIAL (SLM)

Any claim for price increases under a contract or export incentives will be treated as revenue for the year in which there is a reasonable likelihood that it will materialize. the clause in Section 145B (3) If the income from a subsidy, grant, or reimbursement was not subject to income tax in a prior year, it will be considered to have occurred in the year it was received. For their revenue from profit and profits of company or profession and income from other sources, the assessee must use either Cash Accounting or Mercantile Accounting. The provisions relating to accounting standards are amendable by the central government. Regardless of their income bracket, all assessees are required to adhere to these modifications. Before rejecting the books of accounts, the Assessing Officer must record the evidence that led to his determination about the accuracy or completeness of the assessee's accounts or the system of accounting used by it. The assessee has a responsibility to provide the accounts and documentation to the Assessing Officer when needed. The Assessing Officer may use best judgement, but only when it is done legally and without going against natural justice principles. According to the guidelines established by the Income Tax Department, the value of product purchases and sales as well as the presumed income from the prior year must be adhered to. 7.5 SUMMARY  TRPs are also permitted to request up to Rs 250 from income tax payers. As a result, some TRPs charge the costs while others don't if they believe their incentive will cover them.  A Tax Return Preparer (TRP) is a person qualified to help taxpayers file their income tax returns and who has been authorised by the Income Tax Department. A TRP has the necessary abilities to assist people in filing their tax returns in exchange for a small fee, but they are not obliged to be tax attorneys or chartered accountants.  preparing a taxpayer's income tax return. submitting the tax return that has been produced and has been validated by the resource centre to the appropriate Assessing Officer or relevant agency. 136 CU IDOL SELF LEARNING MATERIAL (SLM)

 obtaining a copy of the IT department's acknowledgment on the taxpayer's behalf. This record serves as evidence that the tax return was submitted.  On or before the 7th of every month, submit a statement of details to the Resource Center.  keeping track of key information about each tax return they completed during the most recent assessment year as well as prior assessments.  The Tax Return Preparer Scheme, often known as TRP, is essentially a service for timely tax filing. The Income Tax Department successfully implemented this plan to make the procedure of filing taxes for the taxpayer simpler and easier. 7.6 KEYWORDS  TRP- A Tax Return Preparer (TRP) is an Income Tax Department-approved individual who is trained to assist taxpayers in filing their income tax returns.  Board- “Board” means the Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963 (54 of 1963)  eligible person - means any person being an individual or a Hindu Undivided Family.  Partner Organization - means an organization or agency selected by the Board and with whom an agreement has been entered into by the Board or the Resource Centre authorizing it to act as Partner Organization.  Resource Centre- means the Directorate of Income Tax constituted by the Board to act as the Resource Centre . 137 CU IDOL SELF LEARNING MATERIAL (SLM)

7.7LEARNING ACTIVITY 1. Define TRP ___________________________________________________________________________ ___________________________________________________________________________ 2. State the principles of TRP ___________________________________________________________________________ ___________________________________________________________________________ 7.8 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Who is a tax return preparer (TRP)? 2. Who is eligible to become a TRP? 3. What is the process to become a TRP? 4. What are the duties of a tax return preparer? 5. What is the objective of this scheme? Long Questions 1. How to locate TRPs? 2. How do you calculate TRP? 3. What should be filled in TRP in ITR? 4. What is tax return preparer TRP give further details below? 5. What is identification of TRP in ITR? B. Multiple Choice Questions 1. For purposes of the Earned Income Credit, a qualifying child is a child who... 138 a. is over age 24 at the end of 2010 and not permanently and totally disabled b. has lived with you in the United States for at least 12 months c. is filing a joint return d. meets the relationship test CU IDOL SELF LEARNING MATERIAL (SLM)

2. A taxpayer should itemize deductions if the taxpayer’s total itemized deductions are... a. less than the taxpayer’s interest income b. more than the taxpayer’s standard deduction c. equal to the taxpayer’s self-employment tax d. double the taxpayer’s unemployment compensation 3. Which of the following payments are generally taxable? a. Qualified disaster relief payments b. VA benefits c. Unemployment compensation d. Payments from a government welfare fund based on need 4. The distributions made to a taxpayer from a traditional IRA are less than the required minimum distribution for the year. The amount of excise tax that the taxpayer may have to pay on the amount not distributed is a. 75% b. 50% c. 25% d. 10% 5. Self-employment tax applies to which of the following? a. Individuals who report only interest and dividend income b. Corporations that report less than $50,000 in gross receipts c. Independent contractors reporting net earnings from self-employment of $100 d. Independent Contractors reporting net earnings from self-employment of $400 or more Answers 1-d, 2-b, 3-c, 4-b, 5-d 139 CU IDOL SELF LEARNING MATERIAL (SLM)

7.9 REFERENCES Reference books  Tax Practice Manual Mahendra B. Gabhawala  ZI Padhuka Books CA Final Direct Tax Ready Referencer Book Nov 22 By CA G Sekar  Students' Guide to Income Tax Including GST Vinod K. Singhania, Monica Singhania  Statutory Guide for NBFCs Taxmann Textbooks  Practical Guide to Income Tax Practice The Chamber of Tax Consultants  Tax Audit Srinivasan Anand G.  Law & Practice of Income Tax by Pithisaria&Pithisaria (Set of 3 Vols.) M.K. Pithisaria, Abhishek Pithisaria  Direct Taxes Law & Practice Vinod K. Singhania, Kapil Singhania Website  https://tax2win.in/guide/tax-return-preparer  https://www.bankbazaar.com/tax/income-tax-return-prepared-by-trp-home-for- free.html  https://www.indiafilings.com/learn/income-tax-return-preparer/ 140 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT - 8ASSESSMENT RULES STRUCTURE 8.0 Learning Objectives 8.1 Introduction 8.2 Officer 142A 8.3 Income Computation and Disclosure Standards. 8.4 Summary 8.5 Keywords 8.6 Learning Activity 8.7 Unit End Questions 8.8 References 8.0LEARNING OBJECTIVES After studying this unit, you will be able to:  define 'taxes' and 'microeconomics'  explain different types of taxes  describe how taxes affect demand  give a general explanation of the United States tax code  define income computation and disclosure standards 8.1 INTRODUCTION Every taxpayer is required to provide the Income-tax Department with information on their income. These facts must be provided by completing his income tax return. Following the taxpayer's filing of the income tax return, the Income Tax Department processes the return of income. The Income Tax Department checks the accuracy of the income return. Assessment refers to the procedure through which the Income-Tax department examines the income return. Reassessment and best judgement assessments are included in assessments under section 144. There are four main assessments under the Income-tax Law, which are listed below: Assessment made in accordance with section 143(1), also known as a summary assessment without summoning the assessee. evaluation made in accordance with section 141 CU IDOL SELF LEARNING MATERIAL (SLM)

143(3), or scrutiny assessment Best judgement assessment, which is the evaluation required under section 144. Assessment in accordance with Section 147, often known as Income Escaping Assessment. Section 143 assessment (1) Without contacting the assessee, this is a preliminary evaluation known as a summary assessment (i.e., taxpayer). Areas covered by the section 143 assessment (1) Assessment under section 143(1) resembles a preliminary review of an income tax return. No thorough examination of the income tax return is done at this time. The total income or loss is then calculated, with the following adjustments (if any) being made: I any arithmetical errors in the return; (ii) an incorrect claim (*), if such an incorrect claim is apparent from any information in the return; (iii) disallowing the loss claimed if the return for the prior year for which the set-off of loss is claimed was submitted after the deadline specified under section 139(1); or (iv) disallowing the expenditure indicated in I However, for returns submitted for the assessment year 2018–19 and thereafter, there will be no such modification. However, no such adjustment shall be made until the assessee is notified in writing or electronically of the adjustment. Before making any changes, the assessee's answer, if any, must also be taken into account. If no response is received within 30 days after the issuing of the notification, the modifications must be made. For the aforementioned purposes, \"an incorrect claim apparent from any information in the return\" refers to a claim based on an entry in the return that is I inconsistent with another entry of the same or another item in such return; (ii) for which the information is required to be furnished under the Act to substantiate such entry and has not been so furnished; or (iii) for a deduction, where such deduction exceeds specified statutory limitations Every assessee who generates income during a Financial Year (FY) beyond the basic exemption level is required to provide a statement detailing their earnings, deductions, and other pertinent data. The term for this is the Income Tax Return (ITR). The Income Tax Department will handle your income tax returns after you, the taxpayer, submit them. There are times when an assessee's return is chosen for an assessment based on criteria established by the Central Board of Direct Taxes (CBDT). Self-Evaluation 142 CU IDOL SELF LEARNING MATERIAL (SLM)

The amount of income tax due is decided by the assessee. Different forms for submitting an income tax return are available from the tax department. The assessee combines all of his sources of income and subtracts any losses, deductions, or exemptions he may have been eligible for during the year. The assessee's total income is then calculated. To calculate the tax due on such income, the assessee subtracts the TDS and advance tax from the total. Self- assessment tax, if it is still owed by him, must be paid before he submits his income tax return. Self-assessment is the name of this procedure. Summary Evaluation It is a sort of evaluation that is conducted automatically. In this kind of assessment, the data that the assessee provided in his income tax return is compared to the data that the income tax department has access to. The department checks the return's accuracy and reasonableness along the procedure. The return is completed online, and automated corrections are made for arithmetical mistakes, false claims, and disallowances. For instance, the department's records reveal that the taxpayer's TDS credit is more than what is available against his PAN. A change in this area may result in a rise in the taxpayer's tax obligation. If the assessee must pay tax after the aforementioned modifications, he would get an intimation under Section 143. (1). The assessee is required to react to this notification appropriately. Here is a more in-depth article about Section 143. (1). Regular Evaluation The Assessing Officer or Income Tax Authority, not below the level of an Income Tax Officer, is authorized by the Income Tax Department to carry out this assessment. The goal is to confirm that the assessee hasn't inflated any loss or cost, underestimated any tax, or understated his income. The CBDT has established criteria that determine which taxpayer cases are chosen for a scrutiny examination. a. The Department will notify an assessee well in advance if they will be the subject of a scrutiny assessment. However, such a warning cannot be sent after six months have passed since the fiscal year for which the return was submitted. 143 CU IDOL SELF LEARNING MATERIAL (SLM)

b. To verify the income claimed in his tax return, the assessee will be required to provide his books of accounts and other supporting documentation. The assessing officer issues an order either validating the submitted return of income or adding to it after reviewing all the information available. As a result, an income tax demand is raised, and the assessee must answer appropriately. Best Assessment of Judgment The following situations call for this assessment: a. If the assessee ignores a department notification requesting that he provide certain information or books of accounts; b. If he or she ignores a Special Audit request made by the Income Tax authorities. c. The assessee fails to submit the return by the due date or an additional deadline that the CBDT has permitted. d. The Assessee violates the conditions outlined in the Notice of Summary Assessment. After giving the assessee a chance to present his case, the assessing officer makes a decision based on all the pertinent information and evidence at his disposal. The term \"best judgement assessment\" refers to this. Income Evasion Analysis The assessing officer has the right to assess or review the assessee's income if he has good cause to suspect that any taxable income has eluded assessment. A notification to reopen an assessment must be sent 4 years after the conclusion of the relevant assessment Year. Below are a few situations when reappraisal is prompted. a. Although the assessee has not yet submitted his return, he has taxable income. b. The assessee overstated his income or claimed excessive allowances or deductions after submitting the income tax return. b. Where necessary, the assessee failed to provide reports on overseas transactions. For some taxpayers, assessment may end quickly, while for others it may be quite taxing. A Chartered Accountant is advised to assist you with your case if you are uncomfortable speaking with income tax officials. 144 CU IDOL SELF LEARNING MATERIAL (SLM)

8.2 OFFICER 142A Prior to the Finance (No. 2) Act of 2014, section 142A allowed the Assessing Officer to ask the Valuation Officer to estimate the worth of any investment, bullion, jeweler, or fair market value of any property in order to conduct an assessment or reassessment. After providing the assessee with a chance to be heard, the Assessing Officer may consider the Valuation Officer's report for the purposes of the first assessment or any subsequent assessments after receiving it. The Valuation Officer may be consulted to estimate the value of any investment or piece of property, although Section 142A does not specify that the books of accounts must be rejected as a prerequisite. Furthermore, section 142A does not provide a deadline for the Valuation Officer to produce the report. According to the Finance (No. 2) Act of 2014's modified section 142A, the Assessing Officer may refer any asset, property, or investment to a Valuation Officer in order to determine its worth for the purposes of assessment or reassessment. The Assessing Officer is not obligated to note any satisfaction on the accuracy or comprehensiveness of the assessee's accounts. Additionally, the report of the valuation officer may be approved after a chance for the assessee to be heard. Potential difficulties after the Finance (No. 2) Act of 2014 amendment (a) According to the previous Section 142A, the Assessing Officer may use valuation to determine the value of any investment mentioned in Sections 69, 69A, 69B, or 56. (2). In terms of the valuation trigger, the legislation was clarified and approved. Only when the Assessing Officer was certain that the books of account were inaccurate or incomplete was it permitted to use valuation. According to the modification, the Assessing Officer is no longer required to provide a justification for the referral. In fact, if the Assessing Officer doesn't send instances for value, they could even be afraid of an audit investigation or objection. (a) The revised provision could invite valuation in every case, leading to pointless litigation and wasteful use of the Department's precious resources. (c) The Valuation Officer will take on the role of yet another authority who will make decisions on the appropriate value of any property. It could potentially lead to misuse depending on the valuation discretion he has. (d) The jurisdiction to refer to a valuation officer has been expanded to include any asset, property, or investment, providing the assessing authority wide discretionary latitude that is unchecked. Section 142A: Asset valuation estimated by the valuation officer 145 CU IDOL SELF LEARNING MATERIAL (SLM)

(1) The Assessing Officer may request a Valuation Officer to estimate the worth, including fair market value, of any asset, property, or investment for the purposes of assessment or reassessment and to provide a copy of the report to him. (2) Whether or not the Assessing Officer is satisfied with the accuracy or comprehensiveness of the assessee's accounts, he may refer the matter to the Valuation Officer under subsection (1). (3) The Valuation Officer must, upon a referral under subsection (1), have all the powers provided for in section 38A of the Wealth-tax Act, 1957, for the purpose of determining the value of the asset, property, or investment (27 of 1957). (4) The Valuation Officer must determine the asset, property, or investment's worth after considering the evidence that the assessee may provide and any other evidence that he has obtained and after providing the assessee with a chance to be heard. (5) If the assessee refuses to cooperate or follow his instructions, the valuation officer may estimate the asset, property, or investment's worth using his best judgement. (6) Within six months after the end of the month in which a reference is made under subsection (4) or subsection (5), as applicable, the Valuation Officer must transmit a copy of the report on the estimate produced under those subsections to the Assessing Officer and the Assessee (1). (7) The Assessing Officer may take into consideration such report while conducting the assessment or reassessment after receiving the report from the Valuation Officer and providing the assessee a chance to be heard. The definition of \"Valuation Officer\" in this section is the same as in clause (r) of section 2 of the Wealth-tax Act of 1957. (27 of 1957). 146 CU IDOL SELF LEARNING MATERIAL (SLM)

8.3 INCOME COMPUTATION AND DISCLOSURE STANDARDS Standards for Income Calculation and Disclosure (ICDS) The Income Tax Department and taxpayers may use the Income Computation and Disclosure Standards (ICDS) as a set of rules to determine the assessee's taxable income for a given financial year. The Government of India created the ICDS with the aim of fostering standardization in accounting practices. The ICDS's main function is to control how income is calculated in conformity with the relevant tax laws. With the help of the Institute of Chartered Accountants of India, ICDS was developed utilizing generally accepted accounting principles (GAAPs) (ICAI). It has been around since the 2015–16 fiscal year. The many ICDS provisions are covered in this article. Applicability Regardless of the company's accounting practices, ICDS is applicable to taxpayers who receive income classified as \"Profits and gains of business or profession\" or \"Income from other sources\". The people who compute their income according to the appropriate presumptive taxation system will also be subject to the terms of the ICDS. The rules outlined in ICDS are applicable to gross-basis taxable income, such as internet revenue, royalties, and fees for technical services provided to non-residents under Section 11A of the Act. All taxpayers are subject to the terms of ICDS regardless of their level of income or turnover, with the exception of individuals and Hindu Undivided Families who are not covered by the provisions of Tax Audit. ICDS will not be taken into account for determining the Minimum Alternate Tax (MAT). Qualities of ICDS The key characteristics of the ICDS that the government enacted are as follows: The purpose of ICDS is to calculate income, not to maintain books of account. If the rules are not followed, the authority may be forced to estimate the income using its \"best judgement.\" The ICDS has no revenue or turnover requirements. 147 CU IDOL SELF LEARNING MATERIAL (SLM)

Except for securities, every ICDS has transitional features to make its initial acceptance and evaluation of its implications easier. If there is a dispute between the Act's provisions and those of ICDS, the Act's provisions will take precedence. Prudence is not a basic premise of ICDS unless it is explicitly stated as such in the relevant ICDS. In compared to the Accounts created under the current Accounting Standards, it may result in the earlier recognition of income or profits or the later recognition of costs (AS). In the case that income is not computed in accordance with ICDS, the Assessing Officer may undertake an assessment in line with Section 144 of the Income Tax Act. In order to comply with ICDS, Form 3CD has been updated to provide necessary disclosures. Any assessee with taxable income falling under the headings \"Profits and gains from business or profession\" or \"Income from Other Sources\" is required by Section 145 of the Income Tax Act to calculate their taxable income using the cash or mercantile mode of accounting. The provision further indicates that the Central Government may periodically inform the public whether it applies to any class of taxpayer or any kind of income. Essentials of ICDS Regardless of turnover or income, it applies to all taxpayers (corporation and non-corporate as well as residents and non-residents). As it will be based on the book profits to be computed in accordance with the current relevant AS, it won't have any effect on the minimal alternate tax (MAT) for corporate assessees. Only income charged under the headings \"Profits and gains of business or profession\" or \"Income from other sources\" will be subject to this rule. 148 CU IDOL SELF LEARNING MATERIAL (SLM)

It does not apply to keeping the records up to date; it only applies to calculating revenue. The Income Tax Act will take precedence over the ICDS if there is a dispute. On the basis of ICDS non-compliance, income tax authorities have the authority to assess income using their best judgement. Every ICDS (with the exception of VII, which deals with securities) contains transitional provisions that, in general, call for the recognition of ongoing contracts and transactions as of 1 April 2015 in accordance with it after taking into account income, expense, and loss that have already been incurred in the past. As of March 31, 2015, there was no \"grandfathering\" in place for active contracts or transactions. Like AS, it doesn't provide any justifications or examples. It just sets forth the guidelines to follow when calculating income. Existing AS will continue to apply to revenue and expenses that are not covered by an ICDS. List of ICDS that have been alerted under the Income Tax Act Accounting policies, inventory valuation, construction contracts, revenue recognition, and tangible fixed assets are all covered in the following order: I. The Impacts of Changing Foreign Exchange Rates, Chapter Six IX - Borrowing Fees VII - Government Grants VIII - Securities X - Contingent Assets, Contingent Liabilities, and Provisions The list of ICDS and related notified AS is shown below: Comparison between ICDS and AS There were some ICDS for which draughts were disseminated but no one was informed. 1. Things that happened after the previous year's conclusion 149 CU IDOL SELF LEARNING MATERIAL (SLM)

2. Cost from a Previous Period 3. Rentals A fourth intangible asset Specific deviations from the current AS were used to generate the ICDS. However, the ICDS does not provide the same explanations and examples that AS does. 8.4 SUMMARY  Assessment under section 143(1) can be made within a period of 9 months from the end of the financial year in which the return of income is filed.  This is a detailed assessment and is referred to as scrutiny assessment. At this stage a detailed scrutiny of the return of income will be carried out is to confirm the correctness and genuineness of various claims, deductions, etc., made by the taxpayer in the return of income.  The provision provides that the assessment, re-assessment or recomputation under Section 143(3), Section 144, or Section 147 shall be made in a faceless manner in respect of the specified territorial areas, persons, income or class of cases.  National Faceless Assessment Centre The purpose of this centre is to facilitate the conduct of faceless assessment proceedings in a centralized manner.  If reference is made to TPO, the period available for assessment shall be extended by 12 months.  If return has been furnished under section 139(8A), the order of assessment shall be passed within 9 months from the end of financial year in which such return was furnished. 150 CU IDOL SELF LEARNING MATERIAL (SLM)