Tax Audit Limit u/s 44AB
This query is : Resolved
25 August 2010
What will be tax audit limit for person (agent) who is selling online lottery at fix percentage of commission??
When agents sells lottery online, sales price of lottery is credit to agent's account as sales and at the same time after deducting commission percentage from sales price of lottery that much amount is debited to agent's account as purchase of lottery by agent from lottery co. So net effect is that, only commission amt is credited in agent's account.
Please note that lottery company is not deducting any TDS on such commission.
I think tax audit limit for FY 2009/10 should be Rs. 40 lacs commission amount not the sale amount.
When agents sells lottery online, sales price of lottery is credit to agent's account as sales and at the same time after deducting commission percentage from sales price of lottery that much amount is debited to agent's account as purchase of lottery by agent from lottery co. So net effect is that, only commission amt is credited in agent's account.
Please note that lottery company is not deducting any TDS on such commission.
I think tax audit limit for FY 2009/10 should be Rs. 40 lacs commission amount not the sale amount.
25 August 2010
Applicability to commission agents - If the commission agent does not sell the goods of his principal as his own and only charges commission for bringing two persons to holy marriage of sale and purchase, then he will not come within the ambit of section 44AB, except when his professional receipts exceed Rs. 10 lakhs - Abhay Kumar & Co. v. Union of India [1987] 164 ITR 148 (Raj.).
25 August 2010
But how can this be professional income...agent is just selling lottery without any professional skill. so it just a business so i think limit should be of Rs. 40 lacs. As agents sells lottery, co. debits agent's account by stateing purchase of lottery, then??
25 August 2010
It is just a reference to case law. If you are professional then 10 lacs if not then 40.
As per details mentioned by u, u are not falling in professional so 40 lacs.
As per details mentioned by u, u are not falling in professional so 40 lacs.
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