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Taxchopal Latest Questions

CA Vishnu Ram
Enlightened
Asked: In:

  1. Kirti Agarwal Beginner

    Rent paid to parents can also be considered to take an exemption of HRA. It is not fundamentally different with HRA paid to somebody else. There is no is also Let’s understand this with an example. You can pay rent to your parents and can claim the exemption of HRA as per section 10(13A). But beforeRead more

    Rent paid to parents can also be considered to take an exemption of HRA. It is not fundamentally different with HRA paid to somebody else.

    There is no is also Let’s understand this with an example.

    You can pay rent to your parents and can claim the exemption of HRA as per section 10(13A).

    But before that you must ensure to follow the following procedure:

    1. Sign a rental agreement with your parents for the rental property.
    2. Transfer money to your parents every month.
    3. Ensure that your parents report the rent paid by you as income in their income tax returns.
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    • 1
CA Vishnu Ram
Enlightened
Asked: In:

  1. Advocate Dr Amit Dua Explainer

    HUF means Hindu Undivided Family. You can save taxes by creating a family unit and pooling in assets to form a HUF. HUF is taxed separately from its members.   Mainly A Hindu family can come together and form a HUF. And Buddhists, Jains, and Sikhs can also form a HUF. And also HUF has its own PRead more

    HUF means Hindu Undivided Family. You can save taxes by creating a family unit and pooling in assets to form a HUF. HUF is taxed separately from its members.

     

    Mainly

    A Hindu family can come together and form a HUF. And Buddhists, Jains, and Sikhs can also form a HUF.

    And also HUF has its own PAN and files tax returns independent of its members.

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    • 2
CA Sanjiv Kumar
Enlightened
Asked: In:

  1. CA Manish Kumar Gupta Enlightened

    Hi, So you have received money, generally, people pay to leave a job. So let see the Income-tax treatment of money received in lieu of notice of resignation. This amount will be treated as "Salary" as defined in section 17(1) and will be chargeable to tax on a receipt basis as mentioned in section 1Read more

    Hi,

    So you have received money, generally, people pay to leave a job. So let see the Income-tax treatment of money received in lieu of notice of resignation.

    This amount will be treated as “Salary” as defined in section 17(1) and will be chargeable to tax on a receipt basis as mentioned in section 15 of the Income Tax Act.

    Thanks

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    • 4
Vikas
Beginner
Asked: In:

  1. Swati Teacher

    Golden Rules of Accounting To understand the Golden Rules of Accounting we must first understand the types of accounts. The account classification applies to all the types of general ledgers. In other words, every account will fall in one of the broad classifications given below. There are three typRead more

    Golden Rules of Accounting

    To understand the Golden Rules of Accounting we must first understand the types of accounts. The account classification applies to all the types of general ledgers. In other words, every account will fall in one of the broad classifications given below.

    There are three types of accounts:

    Real Account

    Personal Account

    Nominal Account

    A Real Account is a general ledger account relating to Assets and Liabilities other than people accounts. These are accounts that don’t close at year-end and are carried forward. An example of a Real Account is a cash Account.

    A Personal account is a General ledger account connected to all persons like individuals, firms and associations. An example of a Personal Account is a Ram’s Account.

    A Nominal account is a General ledger account pertaining to all income, expenses, losses and gains. An example of a Nominal Account is an discount account.

    Golden rules of accounting

    As per the accounts type, the accounting rules have been defined. For each account there is a set of Golden Rules and hence there are three Golden Rules of Accounting. The Golden rules define the treatment of all transactions conducted by the business.

     

    Type of account Golden rules
    Real Account Debit – what comes in to the business

     

    Credit – what goes out from the business
    Personal account Debit – the receiver

     

    Credit – the giver
    Nominal Account Debit – the expenses or losses of the business

     

    Credit – the income or gain of the business

     

     

    Illustration An entity named Orange Ltd. has the following transactions.

    1. Purchase goods worth Rs.50,000 from Shyam Ltd.
    2. It deposits Rs.10,000 into Bank.
    3. It sells goods worth Rs.35,000 to Ram.
    4. It pays Rs.12,000 as salary.
    5. It earns Rs.3,000 as interest on a bank account.

     

    First of all, let us identify the accounts involved in these transactions and classify them into the different types of accounts:

    Transaction Accounts involved Type of Accounts Golden rules
    Purchase goods worth Rs.50,000 from shyam Ltd. Purchase Account

     

    Shyam Ltd. Account

    		 Nominal Account – Expense account

     

    Personal Account – Creditors account

    		 Debit the expense or loss

     

     

    Credit the giver

     
    Deposit Rs.10,000 in Bank Bank Account

     

    Cash Account

    		 Real Account – Asset account

     

    Real Account – Asset account

    		 Debit what comes into the business

     

    Credit what goes out from the business

     
    Sale of goods worth Rs. 35,000 to Ram. Sales Account

     

    Ram Account

    		 Nominal Account -Income Account

     

    Personal Account – Debtors Account

    		 Debit the receiver

     

     

    Credit the income or gain
    Pays Rs.10,000 as Salary Salary Account

     

    Bank Account

    		 Nominal Account

     

     

    Real Account – Asset account

    		 Debit the expense or loss

     

     

    Credit what goes out of business

     
    Earn Rs.3,000 as interest on Bank account Interest received

    Bank Account

    		 Nominal Account – Income Account

     

    Real Account – Asset Account

    		 Debit what comes into the business

     

    Credit the income or gain

     

     

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    • 2
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