Maintenance and inspection of documents in electronic form effective from 1st april, 2014 without prejudice to any other provisions of this act, any document, record, register, minutes, etc. Those persons requires to maintain and keep books of accounts when. As per new companies act, 20, many new amendments have overcome and hence a company needs to comply with these amendments as those are mandatory w. Maintenance of books of accounts as per companies act, 20. Provisions under the income tax act, 1961 in relation to retention of records books of accounts of a company. The above books of accounts are to be maintained for a period of 6. Service tax assesses should maintain the above said files, documents, records and the it has to be intimated to the service tax department at the time of first time of filing of service tax st3 returns and the same should be acknowledged.
Expenditure incurred on renovation of the living room, bathroom, back verandah, study, etc. Where to keep your records, for how long and how to. Section 44aa specifies the books of accounts to be maintained for income tax. How to request the permission to destroy your records before the end of their retention period. Every person covered under sub section 4 of section 44ada, i. Maintenance of accounts under income tax act fe newsline chandigarh, wednesday, august 21, 2002 to gain a better understanding of the maintenance of accounts under the income tax act, it would be worth the while to go over certain terms, such as. The detailed requirements of different transactions are prescribed under section 44aa. Following first and second provisos shall be inserted to subsection 2 of section 44aa by the finance act, 2017, w. How long do you have to keep your income tax related. The accounting policies mentioned in icdsi shall be applicable for computing income under the heads. Documents such as rent receipts, section 80c tax saving documents etc.
Section 44ada presumptive taxation for professionals the assessee filing return under section 44ada is not required to maintain books of account under section 44aa. For doctors and other specified professionals, section 44aa of the income tax act, 1961 require compulsory maintenance of books of accounts. Companies act, 1956 books of accounts and vouchers of a company required to maintain for a period of 8 years immediately preceding the current year. The income tax act has specified the books of accounts that are required to be. For how many years do accounts and records need to be.
Maintenance of books of accounts under income tax act, gst act. Provided that where an investigation has been ordered in respect of the company. Expenditure incurred to protect capital asset income of which is assessable to tax. Compulsory maintenance of accounts section 44aa income. Under the act, if any foreign income is suspected to have escaped the tax net, the department can issue a notice to reopen the case up to 16 years after the end of the relevant. Section 209 of the companies act talks about maintaining books of accounts and penalties for non compliance therein. Section 128 of the companies act, 20specifies the following key features related to the proper books of account as under. Section 80hhc of incometax act 19612017 deduction in.
Maintenance of books of accounts in companies act, 1956. Section 44ab compulsory tax audit requirement income tax. In this advance learning we will learn about the provisions relating to maintenance of books of account as given in section 44aa. Maintenance of books of accounts under income tax act, gst. That means the books and records need to be maintained for a period of 8 years effectively.
In case, books of accounts not prepared or not maintained for prescribed period, then penalty of 25000 p. As per section 44aa1 read with rule 6f the persons carrying on any of the profession as mentioned. Compulsory maintenance of books of account under income tax. The due date to file the incometax returns for the f. Commissioner of income tax 2009 10 tmi 569 supreme court of india the supreme court held that the assessing officer cannot refer the matter to the district valuation officer under section 142a of the act without rejecting the books of accounts under section 1453 of the act.
On april 7, 2020, posted by administrator, in articles, with comments off on maintenance of books of accounts under tax laws download pdf maintenance charges in respect of house property penalty notice under section 2711c r w 274 of income tax act, 1961. The period of preservation of books of accounts is different in different laws as under. Section 128 of companies act, 20 books of account, etc. Chandrashekar m the applicable section of income tax act are sections 44aa read with rule 6f maintenance of books of accounts and section 92d read with rule 10d for international transactions. How to keep books of account as per new companies act. Thus, accounts must be maintained for py 199798 and onwards and accounts up to 31st march, 1997 py 199697 need not be maintained for incometax purposes. Compulsory maintenece of books of accounts under income. Every registered person, other than a person paying tax under section 10, i. Books of accounts including vouchers and receipts are required to be maintained under different statutory laws income tax act, companies act 20 and gst act. Section 80hhc of income tax act 19612017 provides for deduction in respect of profits retained for export business. Assessees are required to preserve the specified books of account for a period of 6 years from the end of the relevant assessment year, i. Because epf inspector comes to our office and given a notice to show all accounts records like cash book, ledger, voucher etc since date of last inspection. Maintenance of books of accounts under tax laws a c.
The provisions of income tax act shall also be complied with in this regard. Clarifications issued by cbdt on icds notified under the income tax act, 1961 march 27, 2017. Provisions relating to maintenance of books of account as. Every company is required to maintain books of accounts for 8 financial years. The income tax department never asks for your pin numbers, passwords or similar access information for credit cards, banks or other financial accounts through email the income tax department appeals to taxpayers not to respond to such emails and not to share information relating to their credit card, bank and other financial accounts. It is important to file the incometax return before due date as delay in filing the return will attract late filing fee under section 234f of the income tax act, 1961. Check if you are required to maintain books of accounts as per the income tax act 1961. Books of accounts and vouchers of a section 25 company required to maintain for a period not less than 4. Under income tax act if the saleturnovergross receipts from the business or profession is more than rs. Under this scheme of section 44ad the individuals who are running a business are not required to maintain books of account regularly. Icds is not meant for maintenance of books of accounts or preparing financial statements.
Books of accounts under gst, company act and income tax. Presumptive taxation scheme under section 44ad of income. Set off of loss from one source against income from another source under the same head of income. As per proviso to subsection 5, where an investigation has been ordered in respect of a company under chapter xiv of the act related to inspection, inquiry or investigation, the central government may direct that the books of account may be kept for such period longer. Section 44aa of income tax act and rule 6f of income tax rules deal with the provisions regarding maintenance of books of accounts under income tax act. How long do you have to keep your income tax related documents.
Provisions under the income tax act, 1961 in relation to. Section 44aa gives details of who all are required to maintain books of accounts for the purpose of income tax. Businesses and professions are required to maintain the books of accounts for income tax purpose. Books to be maintained, retention period and compulsion requirements are different under all the 3 laws. Journal if the accounts are maintained according to the mercantile system of accounting ledger. Chapter via sections 80a80u of income tax act, 1961 deals with provisions related to deductions to be made in computing total income. To give relief to small or medium sized taxpayers, the income tax act incorporated scheme of presumptive taxation. It is generally seen that there is confusion among taxpayers about maintenance of books of accounts under income tax act like who is required compulsorily to maintain the books of accounts and for how many years one has to keep his books of accounts.
Clarifications issued by cbdt on icds notified under the. Provided that where the assessment in relation to any assessment year has been reopened under section 147 of the act within the period specified in section 149 of the act, all the books of account and other documents which were kept and maintained at the time of reopening of the assessment shall continue to be so kept and maintained till. Each years books must be kept for a period of 6 years from the end of that year. Every person carrying on legal, medical, engineering or architectural profession or the profession of accountancy or technical consultancy or interior decoration or. Section page contents division one 111 incometax act, 1961 page u arrangement of sections i3 u text of the incometax act, 1961 as amended by the finance act, 2011 1. Period of preservation of accountsrecords under different laws. For this purpose would mean legal, medical, engineering, architectural. How long we should keep company accounts records for epf inspection. Income computation and disclosure standards icds section s. Books should be maintained for a period of 6 years from the end of the relevant year.
Which provision deals with the maintenance of records for the service tax purpose. Interpretation in this act, unless the context otherwise requiresaccounting period, in relation to any person, means the period for which that person makes up the accounts of his or her business. Period of preservation of accounts or for which books are. Books of accounts are a prime source of information through which information can be extracted about a company.
Section 44aa compulsory maintenance of books of account under income tax act. List of income tax documentation to be maintained by. Period of preservation of accountsrecords under different. Municipal property tax chargeable under local tax law of. Filing return of fy 201718 ay 201819 and tax planning. These have been prescribed under section 44aa and rule 6f. Some of the amendments with respect to the books of accounts and keeping the books of accounts have been presented here. However, in case an investigation has been ordered against the company, central government may extend such period. The books of accounts are to kept and maintained for a period of six years from the end of the relevant assessment year. As per income tax act, all assessees are require to preserve the specified books of account for a period of 6 years from the end of the relevant assessment year, i.
Maintenance of books of accounts us 44aa of it act. How long we should keep company accounts records for epf. Followings are the provisions of section 44aa of income tax act. As per income tax rules, books and records need to be maintained for a period of 6 years from the end of the relevant assessment year. Rules regarding maintenance of books of accounts under gst. Maintenance of accounts by certain persons carrying on profession or business. Section 44aa compulsory maintenance of books teachoo. This section provides that every person carrying on the legal, medical, engineering or architectural profession or accountancy or technical consultancy or interior decoration or any other profession as has been notified by the central board of direct taxes in the official gazette must statutorily maintain such books of accounts and other. Text of remaining provisions of allied acts referred to in incometax act 1. The category of persons specified above under section 44aa is mandatorily required to maintain the books of accounts as mentioned below. Section 44aa compulsory maintenance of books of account. If you want to destroy your books of account and records earlier than the retention period specified in how long to keep your records, you first must get written permission from the cra. Books of accounts section 2 of the continue reading how to keep books of account as per. If in the above case income or turnover exceeds the limit of rs.
The retention period for the maintenance of accounts once all the taxes are paid and the legal gst procedures are completed, the balance sheet and the records have to be maintained by the registered taxpayer for a time period of 72 months as per the gst act. Set off of loss from one head against income from another. Assessees are required to preserve the specified books of account for a period of 6 years from the end of the relevant assessment. Section 44aa, talks about the various provisions related to maintenance of books of accounts, which books are required to maintain and the period for which such section 44aa, talks about the various provisions related to maintenance of books of accounts, which books are required to maintain and the p. The books of account and other documents shall be kept and maintained for a period of six years from the end of. Maintenance of books of accounts refers to the records that company has to maintain to keep the details of the specified financial transaction.