does notional gain/income is recorded in books of account
like if a doctor received free service/consultation from a professional then does it is recorded as income in books of accounts of doctor
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Notional gain accounting treatment
Replies (6)
Quick Summary
Yes, provided the value of aggregate services exceed Rs. 50,000/- in any year.
Also for the purpose of accounting?
Yes, without accounting how the tax liability be ascertained.
Sir can you please explain why free service received is recorded in books of account of receiver as income/gain/benefits as no monetary benefits is derived by the firm
please clarify
please clarify
Notional gain itself means gain which is not monetary in nature,
As per sec. 56(2)(X) of IT act, any gain be monetary or notional is taxable.
Accounting in books means it is recorded based on its fair value.
Now since you know its a notional gain its probable that economic benefit inflow is certain. It must be recognised. If not make a disclosure. Its rarely that I see an example valid in accounting where benefits substituted for income.
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