Tax Audit AY 2026-26 Introduction Taxpayers engaged in business or profession must have their books of accounts audited if their turnover, receipts, or income exceed prescribed thresholds under Section 44AB. This tax audit is conducted by a Chartered Accountant in practice. Who Requires a Tax Audit? Following persons are compulsorily required to get their books of account… Read More »

INCOME-TAX RETURN FILING OF INCOME-TAX RETURN BY AN INDIVIDUAL OR HUF Individuals and HUFs is required to file an Income-tax return if their income before claiming specified exemptions or deductions exceeds the maximum exemption limit. Filing is mandatory in certain cases even if income is below the exemption limit, such as foreign assets ownership or… Read More »

Introduction The Annual Information Statement (AIS) is a comprehensive tax passbook provided to taxpayers. It details prepaid taxes and prescribed financial transactions of the assessee for a given financial year. Key Highlights Purpose:AIS is intended to enhance the scope of available financial information for taxpayers. This aids in pre-filled returns and better tax compliance. Contents:AIS… Read More »

Introduction The Statement of Financial Transactions (SFT) is a mechanism for reporting high-value financial transactions to the Income-tax Department. Specified entities are required to file the SFT by May 31st each year, following the financial year in which the transactions were recorded. However, the SFT related to capital gains must be filed on a half-yearly… Read More »

Fair Market Value Introduction Fair Market Value (FMV) is required to compute deemed income under various provisions of the Income-tax Act. The Income-tax Rules provide the valuation methods to determine FMV for different assets, including immovable property, jewellery, unquoted shares, quoted shares, and business undertakings. Applicability of FMV FMV determination is necessary in the following… Read More »

Introduction Generally, income is taxed in the hands of the person who earns it. However, Sections 60 to 64 provide the provisions for clubbing of income in specified cases to curb tax avoidance through indirect transfers or arrangements. Transfer of Income without transferring the Assets. If income is transferred without transferring the asset, such income is clubbed with the… Read More »

Quoting and Linking of Aadhaar Number Introduction Aadhaar, a 12-digit unique identification number, is mandatory for quoting in Income Tax Returns (ITRs) and PAN applications. Aadhaar can replace PAN for specific purposes. PANs allotted before 01-10-2024 using Aadhaar Enrolment ID must be updated with Aadhaar by 31-12-2025. Eligibility for Aadhaar Any resident who has stayed… Read More »

Permanent Account Number (PAN) Introduction PAN is a ten-digit alphanumeric identifier issued by the Income-tax Department to identify taxpayers uniquely. It is mandatory for income-tax filings, high-value financial transactions, and correspondence with the tax authorities. Aadhaar can be used in lieu of PAN. How to obtain PAN A resident applies for PAN inForm 49A, while… Read More »

Losses from certain specified sources falling under the head “Income from other sources” Set-off of losses from activity of owning & maintaining horse races Loss from owning & maintaining horse races can be set off only against income from the same activity. If there is no stake money income in a year, the entire expenditure… Read More »

Loss under the Head Capital Gains Introduction Losses under “Capital Gains” are classified as Short-term Capital Loss (STCL) and Long-term Capital Loss (LTCL). They must be distinctly computed and disclosed in income tax returns, with specific rules for set-off and carry forward. Set-off and Carry Forward Rules Intra-head Adjustment: o STCL: Can be set-off against… Read More »