Author: CA Tarannum Khatri

New stipend rate for CA students

Good news for CA students.. Finally ICAI has opened its eyes towards lower stipend received by CA students. On 10th september, 2014, ICAI has proposed to increase the stipend of CA students. This is the new table in regulation no. 48 of the chartered accountant regulations, 1988.   Place of service of articled assistant During 1st year of training During 2nd year of training During remaining period of training Cities having population of 20 lacks or more Rs. 2000 Rs. 2500 Rs. 3000 Cities having population of 4 lacks and above but less than 20 lacks Rs. 1500 Rs. 2000 Rs. 2500 Cities having population of less than 4 lacks Rs. 1000 Rs. 1500 Rs. 2000 Explanation: No stipend will be payable for excess leave. For the purpose of population, population figure should be taken from the last published census report of india. If student has worked from more than one principal CA, he can add period of previous CA for calculating stipend limit....

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Reverse charge mechanism in service tax ( RCM)

Reverse charge mechanism in service tax  ( RCM) (section 68 (2) ) has been introduced  with effect from 1/7/2012. With its introduction, service receiver is also liable to file return and pay service tax on the portion of service tax. Motive of this change is mainly more tax compliance and increase tax revenue but it is giving hardship to service receiver as if your liability for payment of service tax under reverse charge is small amount like Rs. 1000 or Rs. 100, you have to get registration under service tax act and pay service tax and file return.But rules are rules and we have to follow it. Applicability of reverse charge mechanism in service tax ( RCM): Not all service receiver  are liable to pay service tax under reverse charge. Only on receiving specific services , reverse charge mechanism is applicable. Is service receiver paying extra service tax due to reverse charge mechanism? No, amount of service tax payment is remained the same but liability to pay tax to government is apportioned between service receiver and service provider. Example OF RCM:   If work contractor has rendered services and charged bill of Rs. 100000. Service tax liability is Rs. 1,00,000*14%*70%  = 9800. (30% abatement) Suppose service receiver is liable to pay 50% of service tax under reverse charge mechanism. which is 4900 ( 9800/2). Service provider will charge bill...

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Accountant can not be held liable for short payment of service tax.

M/S Mahisagar Welding works VS. CCI Ahmedabad Court: West zonal bench at ahmedabad court-III   Appeal No. : ST/328/2012 -SM   Appearance: For assessee: Shri vipul Khandar , Chartered Accountants For revenue: Shri GP thomus, A.R.   Brief: There was short payment of service tax by forging in duty paying challan. Appellant had appealed that accountant was responsible for this act act and assessee should not be held liable. Final order was passed that assessee can’t held liable to any other person, acting as his agent, responsible for his willful wrong act or fraud. Details: The assessee has filed appeal against order passed by Additional commissioner , Ahmedabad III. Shri Vipul Khandar , appearing on behalf of appellant argued that delay in payment of service tax is due to Accountant of assessee who had not deposited service tax in time and had forged in figures of service tax payment challan. The shortfall was made good by depositing service tax with interest. Interest was paid after issue of show cause notice. Mr Khandar also argued that penalty should not be levied in this case. He Relied upon following case for non levy of penalty: CBEC Circular No. 137/167/2006 -CX 4. date 3/10/2007 and Bajaj Travels LTD vs. CST. It was also argued that if the above arguement was not accepted then both penalty cannot be invoked  u/s 76 and 78...

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All about company secretary course

The importance of company secretary course has been increase with introduction of companies act, 2013. Company secretary has been considered as key managerial personnel according to the act. Company secretary work is not limited with compliance of company act but he can handle many laws like service tax, labour laws etc. You can also join the course and give KICK to your career.   You can join company secretary course after 12th or graduation/post graduation. Professional like CA, CMA, CWA can also join the course with some relaxation in subjects.   Stages of course: Foundation course (For who join the course after 12th) Executive Programme (for who join after graduation or CA/CMA) Professional Programme (can be joined after executive programme) Admissions dates: Foundation course: Last date for filling form is 31st march for the December exam. Last date for filling form is 30th September for June exam. Executive Programme: Last date for filling form is 28th February for appearing in both modules in December exam in same year. For appearing in one module in December exam, it is 31st May. Last date for filling form is 31st August for appearing in both modules in June exam in next year. For appearing in one module in June exam next year, it is 30 November.   Subjects of CS course:   Foundation: Business environment and Entrepreneurship. Business management, ethics and communication....

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Dividend distribution tax (sec115-O and 115R)-new calculation

If you have invested in the shares of company, you may be aware of dividend distribution tax.   What is dividend distribution tax? When domestic company distributes profit by way of dividend, the company has to pay additional tax via dividend distribution tax. This provision is applicable to mutual fund companies too. Company is not paying dividend from own income but deducting it from dividend and distributing remaining amount to shareholders. Necessity of DDT: We all know that dividend is income and it is taxable. Instead of collecting tax on dividend from each person, the government has introduced section 115O. As per section 115O, company deducts tax from dividend income while distributing dividend income and pays remaining amount to shareholders. DDT vs TDS: DDT is not tax deducted at source but it is like advance tax which shareholders deposit through company.   Does dividend income tax again in the hands of shareholder? No, dividend received by shareholders is exempt as it is already taxed before distribution.   Rate of dividend distribution tax: For domestic company:15% (effective rate is 16.995% including surcharge and education cess) Note: new rate 19.994% from 1st october, 2014. Mutual fund to individual and HUF: 28.325% (effective rate) The rates are effective rates for distribution of dividend. It will be calculated on dividend paid amount.     Calculation of dividend distribution tax: Before 1/10/14: Distribution of...

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