Commission as turnover
This query is : Resolved
Nitesh Parmar
(Querist)
26 September 2014
If my Total Sales is Rs. 95,00,000 and Commission from credit society agency (Commission agent) is Rs. 5,00,000. is required to do tax audit? means whether commission Income will be considered for gross turnover purpose.
26 September 2014
No, as tax audit is for turnover of your goods you are dealing with , interest, commission etc are your indirect income and nothing to do with sales tax.
Nikhil Kaushik
(Expert)
27 September 2014
beg to disagree. there is linkage between sales tax and computation of turnover for income-tax purposes.
The test you need to do is to whether this commission income is business income or not. Before considering it as income from other sources, you need to first rule out Business income.
You are earning this income as commission agent. Commission agency is a business and not a some passive income that you can park in "other sources"
However, tax audit will apply only where turnover exceeds Rs 1 cr. If in your case it is equivalent to 1 cr, audit wont apply.
The test you need to do is to whether this commission income is business income or not. Before considering it as income from other sources, you need to first rule out Business income.
You are earning this income as commission agent. Commission agency is a business and not a some passive income that you can park in "other sources"
However, tax audit will apply only where turnover exceeds Rs 1 cr. If in your case it is equivalent to 1 cr, audit wont apply.
01 October 2014
commision income as an agent is income from business so total business income is exact 1 crore and hence no tax audit is applicable.
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