Chartered Accountants May 2014 Exams got Postponed

ICAI has postponed the CA IPCC and CA Final Exams for May 2014.

Official Notification --> http://220.227.161.86/31966exam22047main.pdf

Revised Date Sheet for May 2014 Exams:

CA Final
26th May, 2014 --> Financial Reporting
28th May, 2014 --> Strategic Financial Management
30th May, 2014 --> Advanced Auditing and Professional Ethics
1st June, 2014 ----> Corporate Allied Laws
3rd June, 2014 ----> Advanced Management Accounting
5th June, 2014 ----> Information Systems Control and Audit
7th June, 2014 ----> Direct Tax Laws
9th June, 2014 ----> Indirect Tax Laws

CA IPCC
27th May, 2014 --> Accounting
29th May, 2014 --> Business Laws, Ethics and Communication
31st May, 2014 --> Cost Accounting and Financial Management
2nd June, 2014 ---> Taxation
4th June, 2014 ----> Advanced Accounting
6th June, 2014 ----> Auditing and Assurance
8th June, 2014 ----> Information Technology and Strategic Management

Note: CA Final & CA IPCC Exam Form can be purchased from 3rd Feb 2014 onwards and last date for submitting the CA Final and CA IPCC Exam Form is 24th Feb 2014.

Deduction in case of Donation to Political Parties or Electoral Trust

An assesse can take benefit of tax deduction under section 80GGB and 80GGC for the Donations made to Political Parties or Electoral Trust.


If you are a Indian Company:
Section 80GGB - any donation made to political parties will be allowed as deduction.
Maximum Ceiling - No Limit, Entire Amount will be allowed as Deduction
Formalities - Take Form 53 from the the trust as a proof that donation is received.
Donation in Kind - No deduction for donation made in kind (Clothes, foods etc.) is not allowed.
Note - Expenditure by way of advertisement in a magazine owned by a political party is also covered u/s 80GGB.





If you are a foreign Company:
No Deduction

If you are Individual, HUF, firm, Association of Persona, Body of Incorporations:
Section 80GGC - any donation made to political parties will be allowed as deduction.
Maximum Ceiling - No Limit, Entire Amount will be allowed as Deduction
Formalities - Take Form 53 from the the trust as a proof that donation is received.
Donation in Kind - No deduction for donation made in kind (Clothes, foods etc.) is not allowed.
Note - Expenditure by way of advertisement in a magazine is not allowed.

If you are any other person:
No Deduction.



Illustrations: Gross Total Income of Mr. X is Rs.4,00,000. Gross Total Income of X & Co. is Rs.40,00,000.
Both of them have made advertisement expenditure in the magazine owned by BJP (Political Party) of Rs.10,000. Decide the amount of deduction available.
Answer: Deduction available to X & Co. (assuming Indian Company) will be Rs. 10,000 under section 80GGB. But for Mr. X not deduction available.


Rohit Jain
frohit@live.in

Deduction in Income Tax for Interest on Education Loan Under Section 80E

Section 80E of Income Tax Act, 1961

Q.1 Who can claim deduction?
Only Individual can claim deduction under section 80E.

Q.2 What is Expenditure Qualified for deduction under section 80E?
Interest paid on Loan.
Loan should be taken:
1. for Study after Senior Secondary or its equivalent
2. from a Bank, Financial Institution or an Approved Charitable Institution
Interest must be actually paid for claiming deduction.

Illustration: Rohit has taken a loan  for MBA from a Bank. He has not paid any interest upto 4 Years. The accrued interest after 4 years is Rs. 40,000. He pays entire interest accrued today. What is the amount of deduction?
Answer: Rs. 40,000 because deduction under section 80E is allowed on the basis of actual payment.

Q.3 For whom education loan taken is deductible?
Deduction is allowed if loan is taken for
- Individual (himself/ herself)
- Relative (Spouse, children or any other student for whom individual is legal guardian)



Q.4 What is the Period of Deduction?
Deduction is allowed in the year when individual starts paying the interest and in subsequent 7 years or until interest is paid in full. However, Interest should be paid out of Income Chargeable to Tax.

Q.5 Does it matter the Education/ Course pursued is Full Time or Part Time?
No, it does not matter now.
Earlier, deduction was allowed only for the full-time courses.
But, the budget of 2009 changed all this and now you can claim tax benefits in respect of part-time courses too. What is required is that the course should be pursued from any government-recognised school, board or university, though not necessarily under the central government. It may be recognised even by a local authority. Even a part-time course or a diploma course will qualify for the purpose of claiming this interest deduction, provided the institution imparting such course is recognised

Illustration: Mr. Jain has taken a loan for Part Time MBA of Rs.100,000 and Rs.2,50,000 for his son for Full Time MCA. Interest paid on loan is 10%. What is amount of deduction?
Answer: Deduction will be available to Mr. Jain under section 80E. Amount Rs. 35,000.

Note: Deduction is also available for education pursued outside India.

Q.6 Is there any maximum ceiling on the amount of deduction?
Earlier the maximum ceiling was Rs. 40,000.
But, currently there is no limit on maximum amount of deduction uder section 80E.

FAQ1. Suppose Ram has taken Loan of Rs. 1,00,000 for his higher studies but his father has paid the interest. Is there any deduction available under section 80E for the interest paid?
No, Interest must be paid by the person, who has taken the loan only.


FAQ2. Other Relevant points:
1. You need to obtain a Certificate from your Bank to claim deduction under section 80E by specifically segregating the principal amount and interest paid by you during the financial year.
2. You have to pay the entire amount within 8 Years from the year you starts paying the interest, otherwise after 8 years, no deduction will be allowed.

Rohit Jain
frohit@live.in

Accounting Standards: A Brief Intro

Meaning

Accounting Standards are written documents

Issued by

Expert Accounting Body, Government or Other Regulatory Bodies

Covering the aspects of

Recognition, Measurement, Treatment, Presentation and Disclosure

Of Accounting Transaction

In the Financial Statements

Objectives of Accounting Standards

1.      To eliminate non - comparability of Financial Statements to the extent possible.

2.      To standardize the diverse Accounting Policies and Practices.

3.      To add the reliability to the Financial Statements.

Role of Various Departments

Formulated by                         Accounting Standard Board of ICAI

Notified by                              Ministry of Corporate Affairs

In Consultation with                National Advisory Committee on Accounting Standards

Advantages of AS

Understandability

The accounting standards formulated by the ASB represent the required processes for businesses to follow. Financial statement users expect companies to follow the published accounting standards when creating financial statements. The users interpret the financial statements of different companies using the same assumptions. Once the users understand these assumptions, they use this knowledge when reading any financial statement.

Guidance

When financial reporting issues arise, the accountant may refer to the published accounting standard to determine how to record the event. This process allows the accountant to trust that the guidance provided through the accounting standard passed the rigorous process of ensuring that it meets everyone's needs.

Disadvantages of AS

Inflexible Framework

A disadvantage of using accounting standards involves the inflexible framework the accountant must comply with. Each company faces different experiences. The accountant must make the company's unique experiences fit into the guidelines of the published accounting standards.

Cost to Comply

New accounting standards require the company to consider the requirements of the standard, what actions the company must take to implement the standard and what the cost will be. In many cases, the company must design new procedures, which requires a large financial investment that includes employee labour costs, system upgrades and employee training.

Existing Accounting Standards and Indian Accounting Standards

Now India will have two sets of accounting standards viz. existing accounting standards under Companies (Accounting Standard) Rules, 2006 and IFRS/ IAS converged Indian Accounting Standards (Ind AS).

There are 36 Ind AS hosted by MCA on its website. The date on which these will come into force is yet to be notified.

Thanks

Rohit Jain

frohit@live.in

Requirement of Industrial Trainees at BPCL, Noida

          

Company Name: BPCL - Bharat Petroleum Corporation Limited, Engineering and Project Department.
Address: 1st Floor, A-5 & 6, Sector - 1, Noida - 201301
Stipend: Rs. 12,000 per month.
Eligibility: Students pursuing CA IPCC as per ICAI's Guidelines.
Contact Person: Mr. V K Kapoor (Deputy General Manager - Finance)
Send Resume to Email id: KapoorV@BharatPetroleum.in
Or Post Resume at following address: Mr. V K Kapoor, Secretary to Deputy General Manager (Finance), Bharat Petroleum Corporation Limited, Engineering and Project Department, 1st Floor, A-5 & 6, Sector - 1, Nodia - 201301.

Kindly also mention the status of CA Final Examination.
Interested Candidates may send their Resume with all details on jobs handled in brief with balance period of training left.

BPCL will call eligible candidates in due course of time.

Source: CAConnect.In
Official Announcement: http://www.caconnect.in/wp-content/uploads/2014/01/induustrial-training.pdf 

CA Final Nov 2013 and CA CPT Dec 2013 Result Date

The result of the CA Final held in November, 2013 and CPT held in December, 2013 are likely to be declared on
Wednesday, the 15th January, 2014 around 2.00 P.M. 
The result will be announced on http://www.caresults.nic.

For more refer the official announcement by ICAI --> http://220.227.161.86/31856exan21982.pdf

Tax Haven

Have you ever daydream about going to a Tax Free Country?

Meaning

A tax haven is a state, country or territory where certain taxes are levied at a low rate or not at all.

According to Geoffrey Colin Powell, “What identifies an area as a tax haven is the existence of a composite tax structure established deliberately to take advantage of, and exploit, a worldwide demand for opportunities to engage in tax avoidance.”

According to Sinclair Davidson, “Any country which modifies its tax laws to attract foreign capital could be considered a tax haven.”

According to OECD, the tax havens have three characteristics:

• Nil Tax or only Nominal taxes
• Protection of personal financial information
• Lack of Transparency

There are many major corporations in tax havens, such as Apple, Microsoft, Bank of America, Cisco and many more.

Consequences

In 2007 the OECD estimated that capital held offshore* amounted to between US $5 trillion and US $7 trillion, making up approximately 6-8% of total global investments under management.

*Capital held offshore means keeping of money in a jurisdiction other than one’s country of residence. They are generally adopted by investors as a mean of reducing the taxes.

In 2012 the Tax Justice Network estimated that capital held offshore amounted to between US $21 trillion and US $32 trillion, making up approximately 24-32% of total global investments under management.

The Tax Justice Network also claimed that Global Tax Revenues lost due to tax havens is between US $190 Billion and US $225 Billion per year.

List of Top 10 Tax Havens Countries [Source: TheRichest.Com]

1. Switzerland

The Country implements an extremely high level of secrecy when it comes to the financial assets of its clients.

2. Cayman Islands

No Personal Income Taxes, Capital Gains, Corporate Taxes, and Payroll Taxes. The Country does not even withhold tax on foreign clients.

3. Luxembourg

In the Tax Justice Network Report, the country got a Financial Secrecy Index Value of 1,621.

4. Hong Kong

No Sales Taxes, Capital Gains, and Payroll Taxes.

5. USA

No Corporate Taxes, Inventory Taxes, Unitary Taxes, Gift Taxes, Estate Taxes, Personal Income Taxes, Franchise Taxes, and Inheritance Taxes.

6. Singapore

Almost anyone can open such a bank account without experiencing any hassle.

7. Jersey

Houses a Great Number of Banks offering Offshore Accounts to foreign Clients.

8. Japan

Many of the Offshore Banks in Japan do not subject the deposits made by their clients to interest rate standards and regulations.

9. Germany

Easy for people to open Offshore Bank Accounts. But the country is now trying to control this problem.

10. Bahrain

There are plenty of Financial Institutions offering offshore banking services and bank accounts in the island, but its client financial secrecy is the lowest of all the other nations included in this list.

Roughly 15% of Countries are tax havens; these countries tend to be small and affluent.