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Self assessment tax

francis desilva (Assistant Manager Accounts & Finance) (27 Points)

29 August 2013

can any one explain me ,, what is the self assessment tax and when it should be paid.. and the difference between self assessment tax and the advance tax paid and their implication in the preparation of final account under revised schedule VI including cash flow,,, pleeeeez

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6 Replies

Mihir (Wealth Manager) (5293 Points)
Replied 29 August 2013

Tax paid before the end of the financial year is advance tax; thereafter self-assessment tax.

NAGASAI.K (Article Assistant) (193 Points)
Replied 29 August 2013

Advance tax means tax paid on estimation basis whereas self assessment tax is paid on actual basis

CA Pracheta Shirish Deshmukh (CA) (204 Points)
Replied 29 August 2013

advance tax is the tax paid by the assesse on an estimation basis if the estimated tax on the estimated net taxable income exceeds Rs. 10000. It is paid in instalments-eg. 4 instalments for the company and 3 instalments for the individual assesse. it is the tax paid in advance before the end of the financial year.the meaning of self assessement tax can be self explained from its name only i.e. SELF ASSESSEMENT.i.e. the assessement of the tax done on the actual basis by the tax payer or its chartered accountant before the actual tax assessement done by the income tax department through sec 143(1). Under Revised Schedule VI, advance tax paid is shown under the loans and advances.

srikumar (audit staff) (1203 Points)
Replied 02 September 2013

sir, i have one doubt for u/s 44ad . in my one client maintain books of accounts but turnover of netprofit below 8% whether such assessee accounts goes to 44ad. pls explain briefly sec 44ad

which situation 44ad is applicable and not applicable ? urgent pls ..............

Ranu Purohit (Job) (55 Points)
Replied 02 September 2013

Dear Srikumar,

From Assessment year 2011-12, a new section 44Ad has been inserted in the I.T.Act

The new Section will be aplicable to any business ( whether it is Retail trade,or Civil construction or any other business).
The provisions of the new Section will be applicable if the following conditions are satisfied:

1. Assessee eligible for the purpose of this Section has to be an Individual/a HUF/a Partnership Firm( not being a LLP);
2. The assessee has not claimed any deduction u/s.10A,10AA,10B,10BA,80HHto 80RRB in the relevant Assessment Year;
3. The is not engaged in the business ofplying,hiring,or leasing goods carriages referred to u/s. 44AE; and
4. Total Turnover/ Gross Receipt of the Assessee in the previous year should not exceed Rs. 60.00 lakhs.

Consider the following cases :

Turnover is 50 Lac

case-1 : NP 2 Lac

case-2 : NP 5 Lac

Now if u want to take benifit of sec.44AD :

case-1 : u can claim minimum amount of upto 4 lac (i.e.8% of turnover)

case-2 : In such case u can claim actual profit (i.e. higher than 8% of t/o) of amount 5 lac.

I hope it will help u to better understand.

thanks/regards,