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Mercantile or cash system

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(Querist)
14 April 2014 I am an Individual having small business in which I am a proprietor. I am maintaining Mercantile accounting system. I have also some fixed deposit with bank in my personal name. Can I adopt cash system in respect of interest earned on fixed deposit. My question is this that can I adopt both mercantile & cash system in this case.

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Sanjiv
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Nikhil Kaushik

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Nikhil Kaushik (Expert)
14 April 2014 i believe you can very much do so. But please be assured that banks would deduct tax on accrual basis.
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Rupesh Jain

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Rupesh Jain (Expert)
15 April 2014 you adopt accrual method due to under income tax act income taxable as accrual basis.

this practice will beneficial in future.




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