Question 1

What documents are needed for income tax return filing?

Accepted Answer

For salaried individuals: Form 16, bank statements (all savings and FD accounts), investment proofs under Section 80C/80D (LIC, PPF, ELSS, health insurance), home loan interest certificate (if applicable), Form 26AS or AIS from the income tax portal, and Aadhaar linked to PAN. For business owners: profit and loss account, balance sheet, bank statements, GST returns, and details of all receipts and payments for the financial year.

Question 2

Which ITR form should I file — salaried, business, or capital gains?

Accepted Answer

Salaried individuals with income up to Rs. 50 lakh and no capital gains file ITR-1 (Sahaj). If you have capital gains from shares, mutual funds or property, file ITR-2. Business owners and professionals file ITR-3, while those on presumptive taxation (Section 44AD/44ADA) file ITR-4 (Sugam). Companies file ITR-6 and trusts/NGOs file ITR-7. Filing the wrong form leads to a defective return notice under Section 139(9).

Question 3

What is the deadline for ITR filing for AY 2026-27?

Accepted Answer

For individuals and HUFs not requiring audit, the due date is 31 July 2026. For businesses requiring tax audit under Section 44AB, the deadline is 31 October 2026. For those requiring transfer pricing reports, it is 30 November 2026. A belated return can be filed until 31 December 2026, but attracts a late fee of Rs. 1,000 to Rs. 5,000 under Section 234F plus interest under Sections 234A/234B/234C. Please verify current deadlines against the official CBDT notifications.

Question 4

How can I save tax under Section 80C, 80D and other deductions?

Accepted Answer

Under the old tax regime, Section 80C allows deductions up to Rs. 1.5 lakh for PPF, ELSS, life insurance, NSC, fixed deposits (5-year), home loan principal, tuition fees, and Sukanya Samriddhi. Section 80D allows Rs. 25,000 for health insurance (Rs. 50,000 for senior citizens). Additional deductions include Section 80E (education loan interest, no limit), Section 80G (donations), Section 24(b) (home loan interest up to Rs. 2 lakh), and NPS under Section 80CCD(1B) for an extra Rs. 50,000. The new tax regime offers limited deductions — consult a CA to determine which regime saves more for your specific income structure.

Question 5

What happens if I miss the ITR filing deadline?

Accepted Answer

Filing after the due date but before 31 December of the assessment year is a belated return under Section 139(4), which attracts a late fee under Section 234F — Rs. 1,000 if total income is below Rs. 5 lakh, and Rs. 5,000 otherwise. You also lose the right to carry forward losses (except house property loss) and pay interest under Sections 234A, 234B and 234C on any outstanding tax. If you fail to file even a belated return, the Income Tax Department may issue a notice under Section 142(1) or initiate best judgement assessment under Section 144.

Question 6

Who needs to register for GST in India?

Accepted Answer

GST registration is mandatory if your aggregate turnover exceeds Rs. 40 lakh for goods (Rs. 20 lakh in special category states) or Rs. 20 lakh for services (Rs. 10 lakh in special category states). It is also mandatory regardless of turnover for inter-state suppliers, e-commerce sellers, TDS/TCS deductors, casual and non-resident taxable persons, input service distributors, and agents of a supplier. Voluntary registration is advisable if you want to claim input tax credit or supply to businesses that need GST invoices.

Question 7

What are the GST return filing deadlines — GSTR-1, GSTR-3B?

Accepted Answer

GSTR-1 (outward supplies) is due on the 11th of the following month for monthly filers, or quarterly under the QRMP scheme (13th of the month after the quarter). GSTR-3B (summary return with tax payment) is due on the 20th of the following month for monthly filers, or the 22nd/24th of the month after the quarter under QRMP. GSTR-9 (annual return) is due on 31 December. Late filing attracts Rs. 50 per day (Rs. 20 for nil returns) under each Act (CGST + SGST), capped at 0.25% of turnover. Please verify current dates against the CBIC portal as they may change by notification.

Question 8

What should I do if I receive a GST Show Cause Notice under Section 73 or 74?

Accepted Answer

A Show Cause Notice (SCN) under Section 73 alleges short payment without fraud (time limit: 3 years), while Section 74 alleges wilful misstatement or fraud (time limit: 5 years). On receiving an SCN, immediately engage a CA or tax professional. Check the DRC-01 notice for the exact demand, tax period and grounds. You must reply within 30 days (extendable by 30 days on request) via Form DRC-06 on the GST portal. If the demand is correct, paying the tax with interest before the order avoids penalties entirely under Section 73. For Section 74, paying within 30 days of the SCN reduces the penalty to 15% of the tax amount. Never ignore an SCN — non-response leads to an ex-parte order.

Question 9

How does GST apply to real estate and under-construction property?

Accepted Answer

GST applies at 5% (without ITC) on under-construction residential properties and 12% on commercial properties. Affordable housing (up to Rs. 45 lakh, carpet area up to 60 sqm in metros or 90 sqm elsewhere) attracts 1% GST without ITC. No GST applies on ready-to-move-in properties with an Occupancy Certificate (OC) or Completion Certificate (CC), or on resale of property. For developers, the effective rate depends on whether they opt for ITC — the 5%/1% scheme requires that 80% of inputs are procured from registered dealers. Land value is excluded by deducting one-third of the total consideration.

Question 10

What is RERA and who needs to register under MahaRERA?

Accepted Answer

RERA (Real Estate Regulation and Development Act, 2016) requires all real estate projects with land exceeding 500 sqm or more than 8 apartments to register with the state authority before advertising or selling. In Maharashtra, registration is with MahaRERA (maharera.mahaonline.gov.in). Promoters must deposit 70% of buyer payments in a separate escrow account, file quarterly progress reports (QPR), and cannot change plans without two-thirds buyer consent. Failure to register attracts a penalty of up to 10% of project cost, and continued violation can lead to imprisonment up to 3 years.

Question 11

What due diligence should a buyer do before purchasing property from a builder?

Accepted Answer

Before purchasing, verify the builder's MahaRERA registration number on maharera.mahaonline.gov.in — check project timeline, complaints and quarterly reports. Obtain and verify the title search report, commencement certificate (CC), approved building plan, and environmental clearance. Check whether the builder maintains the mandatory three separate bank accounts under MahaRERA (collection, separate and withdrawal). Review the builder's financial health through audited financial statements, ongoing litigations via court websites, and past project delivery track record. For redevelopment projects, additionally verify the existing society's resolution, the development agreement terms, and the corpus fund arrangement.

Question 12

What are the tax implications of a Joint Development Agreement (JDA)?

Accepted Answer

In a JDA, the landowner transfers development rights to a builder in exchange for constructed flats or revenue share. For the landowner, capital gains tax liability arises in the year of the Completion Certificate (CC) or Occupancy Certificate (OC), not at the time of signing the JDA — this was clarified by Section 45(5A) introduced via Finance Act 2017. GST applies on the construction service provided by the developer to the landowner at applicable rates. The developer faces GST on the transfer of development rights (TDR) under reverse charge mechanism (Notification 5/2019). Stamp duty applies on both the JDA and individual sale deeds. Proper structuring by a CA can significantly reduce the combined tax outgo.

Question 13

How to register a Private Limited Company in India?

Accepted Answer

Private Limited Company registration is done through the SPICe+ form on the MCA portal. You need a minimum of 2 directors (at least one Indian resident) and 2 shareholders. Documents required: PAN, Aadhaar, passport-size photo, address proof and a specimen signature for each director; registered office address proof with NOC from the owner. The process includes obtaining Digital Signature Certificates (DSC), Director Identification Numbers (DIN), name approval, drafting the MOA and AOA, and filing SPICe+ which now integrates PAN, TAN, EPFO, ESIC and bank account opening. Typical timeline is 7-15 working days. Post-incorporation, you must appoint an auditor within 30 days and file annual returns and financial statements with the ROC each year.

Question 14

What are the benefits of MSME or Udyam Registration?

Accepted Answer

Udyam Registration (formerly MSME registration) is free and done online at udyamregistration.gov.in using Aadhaar. Benefits include: priority sector lending from banks at lower interest rates, collateral-free loans up to Rs. 100 lakh under CGTMSE, protection against delayed payments (buyers must pay within 45 days or face compound interest at 3x the bank rate under the MSMED Act), concession on electricity bills in some states, 50% subsidy on patent and trademark filing, exemption from direct tax for the first 5 years in some schemes, access to government e-procurement tenders (mandatory 25% procurement from MSMEs), and eligibility for various MSME development schemes including PMEGP, CLCSS and ZED certification.

Question 15

What is a Virtual CFO and how is it different from a regular accountant?

Accepted Answer

A Virtual CFO provides strategic financial leadership on a part-time or retainer basis without the cost of a full-time CFO. While a regular accountant handles compliance — bookkeeping, tax filing, TDS returns — a Virtual CFO focuses on forward-looking functions: monthly MIS and dashboards, cash flow forecasting, budgeting, funding readiness and investor reporting (financial projections for banks and investors), banking relationship management, compliance calendar across all regulators, business valuation, and strategic financial planning. Engagements are scoped to the business, usually as a monthly retainer. MSMEs with turnover between Rs. 1 crore and Rs. 50 crore benefit most, gaining CFO-level insight at a fraction of the cost.

Question 16

When does a business need a Virtual CFO?

Accepted Answer

Consider a Virtual CFO when your business experiences any of these: turnover crossing Rs. 1 crore with increasing compliance complexity, planning to raise funding from banks or investors (they expect financial projections and MIS), cash flow problems despite growing revenue, managing multiple GST registrations or entities, entering regulated sectors like real estate or export, needing DPDP Act compliance or ESG reporting, or when the founder is spending more time on finance than on the business. A Virtual CFO is particularly valuable during transitions — pre-audit preparation, expansion to new states, starting exports, or preparing for a merger or acquisition.

Question 17

What is the difference between statutory audit and internal audit?

Accepted Answer

A statutory audit is mandated by law — under the Companies Act 2013 for companies, or under Section 44AB of the Income Tax Act for businesses exceeding the turnover threshold. It results in an independent audit report expressing an opinion on whether financial statements give a true and fair view, conducted by an external Chartered Accountant. An internal audit is an ongoing assurance function focused on improving internal controls, risk management, and operational efficiency. It is conducted by an internal team or outsourced CA firm and reports to management or the audit committee. Companies with turnover above Rs. 200 crore or borrowings above Rs. 100 crore must have a mandatory internal audit under Section 138 of the Companies Act.

Question 18

When is tax audit mandatory under Section 44AB?

Accepted Answer

Tax audit under Section 44AB is mandatory if: business turnover exceeds Rs. 1 crore (Rs. 10 crore if at least 95% of transactions are digital), or gross receipts of a profession exceed Rs. 50 lakh. It is also required if a person covered under presumptive taxation (Section 44AD/44ADA) claims profits lower than the presumptive rate and their income exceeds the basic exemption limit. The audit must be completed and the report filed in Form 3CA/3CB and Form 3CD by 30 September (for non-transfer-pricing cases) of the assessment year. Non-compliance attracts a penalty of 0.5% of turnover or Rs. 1.5 lakh, whichever is lower, under Section 271B. Please verify current thresholds against official CBDT circulars as they are periodically revised.

Chartered Accountants in Kandivali East, Mumbai

Core services

Guides

Areas we serve