Suggestions for finalizing personal accounts and ITR

[CA DEV KUMAR KOTHARI]

Due date for furnishing Return of Income (ROI) is approaching fast. It is high time to be more careful and diligent towards filing of ROI on time to avoid consequences and disadvantages of delay in filing ROI

New ITR forms have been prescribed. There are many new disclosure and computation requirements in comparison to earlier years. Therefore, it is suggested to take immediate steps and advise clients to take immediate steps for.

Identifying applicable and most suitable form of ITR  according to facts and circumstances of assesse.

Go through new ITR forms and compile information, reports, forms etc.  Required to be filled in or attached to the ITR form as may be applicable.

Reconcile all balances of assets, liabilities in monetary terms and physical terms both wherever applicable and get confirmed from third parties and as per physical verification and statements etc., as far as possible.

Also check adjustments in income from any assets which are not incorporated in accounts / Balance sheet but were charged to drawings, or gifts received and  not  incorporated in accounts  etc. as many people do in case of PPF, EPF, NSC, gifts received in kind and cash, …..  etc. .

Make reconciliation of receipts of gross income / payments and TDS with form 26AS.

This will also ensure accounting of incomes and expenses, and greatly reduces chances of mistakes in ascertainment of income.

Carefully check and get confirmed figures of incomes which are not subject to TDS and for which third party statements may not be immediately available. Obtain confirmations and make necessary adjustments.

Account for income like interest on PPF, EPF, securities, mutual funds, LIP and ensure proper adjustment for refunds of Life insurance policies, interest on income tax refund and similar items which are prone to omissions.

Medical insurance, and preventive medical health check-up check payments, also check  in drawings/ personal expenses account and insurance premium account etc. so that can  be properly claimed. Can plan  health insurance and preventive check –up expenses considering composition of family, parents and payments being presently made to take full advantage of provisions.

Gifts given and received, check  proper adjustments in capital accounts and respective assets in hands of donor and done within family and close relations.

Re-investment for capital gain exemption to be planned and done preferably  before due date.

Salary as  director – as director or  executive: - employer – employee relationship to be establishes. For this ensure:

Monthly payment, Attendance, Perquisites, deductions for absence. ,  … etc. as is generally in case of senior officers.

Plan to compile all documents and information well in time and file ITR well before due date so that list of pending work are reduced.

The above  list is illustrative and not exhaustive.