PERSONAL ACCOUNTING

MODULE 2

NEED TO MAINTAIN To know the assetsACCOUNTto pay off. owned and liabilities
To ascertain the operational profit or loss. To assess the financial position of an individual. To keep systematic records of financial transaction. To protect the business properties from unjustified and unwarranted use. To facilitate rational decision-making.
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METHODS
TRADITIONAL METHOD:
Book keeping. Maintaining journal, ledgers, account books etc.

ELECTRONIC METHOD:
Use of software to manage accounts. Popular Software like Tally, Perfios, Microsoft Money, Microsoft excel (for budgeting).

PAN
10 digit Alpha Numeric Code allotted by Assessing Officer of Income Tax Department. PAN enables the department to link all transactions of the person with the department. These transactions include:- Tax payments, TDS credits, Returns of income/wealth/gift/FBT, specified transactions, correspondence, and so on.
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 Under section 139 (A), following persons have to compulsory apply for PAN: Whose total taxable income is more than the exemption limit of income tax. Businessman whos total sale, turnover or receipt is more than Rs. 5 lacks in previous year. Besides the above mentioned, as per section 139 A (1A), Charitable religious trust, Importers & Exporters as well as assesses of Central Excise, Sales Tax and Service tax, have to also file for return. Penalty of Rs. 10,000 under section 272 B (1).
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 As per Income Tax Rule 114B, it is mandatory to quote PAN for following transactions: Sale, Purchase of Immovable property valued at Rs. 5 lacks or more. Sale & Purchase of Motor Vehicle (excluding 2 wheelers). Opening of Bank Account/ Application for Credit Card/ Telephone. Payment of Hotel Bill for more than Rs. 25,000. Cash deposit of Rs. 50,000 or more in a day in the Bank or Post Office. Payment of Rs. 50,000 or more to purchase MF/ Shares/ Debentures/ RBI Bond. Income Tax return, Challan for payment of Direct Tax. A contract of a value exceeding Rs. 1 lacks for sale or purchase of securities; Payment in cash in connection with travel to any foreign country of an amount exceeding Rs.25,000 at any one time.
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SPECIMEN FORM 49 (A)

INCOME TAX RETURN

OBLIGATIONS OF FILING TAX RETURNS: It is a legal obligation for every individual to file a return of income, whose taxable income during the year has exceeded the exemption limit . DOCUMENTS REQUIRED: Form No. 16 (received from the employer). Form No. 16A (received from all the payers who have deducted tax). Summary of all bank accounts operated during the year
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 Details of property owned during the year:

Sale & purchase bill / documents / contract note in respect of investments / assets sold during the year
Details of tax payments made during the year: This is required only if you have made advance tax payment during the year.

ITR FORMS
ITR-1 Meant for Individuals, who have Income from salary, Interest income (taxable / exempt), Family pension and Income from agricultural activities ITR-2 Individuals / HUF not having any income on account of carrying out business / profession or on account of being a partner in a partnership firm. ITR-3 Individuals / HUF who are partner in a partnership firm and does not carry out any other separate business / profession. ITR-4 Individuals / HUF who is carrying out business / profession under a proprietary concern.
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