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Tax filing first time at age of 58 yrs

Learn Law (Student) (70 Points)

19 January 2014

Hi,

Person is self-employed and generating income from small street stall. Never filed return as income do not have any proof and not even taxable. Now, with Tax awareness increased want to file return. What are the thing need to take care? He has some money saved in past few years.

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5 Replies

CA Raj Doshi (Practising CA) (8735 Points)
Replied 19 January 2014

The cash deposits and withdrawals from bank statement, his personal rough record of debtors creditors , and information on investments FD Loan shall make u create a balance sheet p/l and thereby file I.T return. The client must be convinced to co- operate. Regards Raj C Doshi

Learn Law (Student) (70 Points)
Replied 20 January 2014

Money earned on daily basis is not going to bank and spent directly. For example, earning 2000 per month and spending same. How to show it in return as income?

(Guest)

Ask him to make an estimate of how much he earns per day/ week/month. ask him about his monthly home expenses budget. work out in the following way

Opening cash+ bank balances

Add:monthly stall income*12

Add: yearly interest, other income

Less: monthly stall expenses*12

Less: monthly household expenses*12

Less: yearly investments(PPF, LIC, FD etc)

Less: yearly extra spendings(eg medical, asset purchased)

= cash+ bank balances Closing balance

Mihir (Wealth Manager) (5293 Points)
Replied 20 January 2014

The method shown by Ms. Pandit will have to be followed to prepare P&L from cash inflow/outflow statements.

It needs to be seen whether he wants to go through this difficult exercise for the whole year just to file IT returns which, as you said, is not even taxable.