On what basis should you pay advance tax ? business and CA worried and confused

Advance tax

Mumbai. Due to epidemic, the condition of all small and big companies and business people are in a poor condition , they are also facing new types of challenges. One such problem arose with advance tax. The deadline for filing the first installment of advance tax has come to a close on Monday, June 15, and for the past one week, the owners of most companies and their CAs have been worrying about the fact that when the business is closed, and there is no revenue. Calculate tax on the basis and how much tax to pay. And how to arrange money to pay taxes? In this way, there is a sense of anxiety and confusion before the companies.

How much will there be sales in the whole year?

In fact, companies have to pay the first installment of 15% of that tax by June 15 on the estimated turnover and earnings of their entire year. After that, 30% has to be paid till 15 September, 30% by 15 December and the remaining tax has to be paid by 15 March. The estimated tax liability should not be more than 10% difference. Now, due to the Kovid epidemic and lockdown, many companies did not have any sales in this quarter (April-June) and the future seems uncertain. Now in such an environment, it is very difficult to guess the business of this year in front of entrepreneurs. Because there is a risk of corona. And when it will end, it seems impossible for anyone to guess. When will corona end? When will the markets open, how many sales will happen in the whole year? So how should tax be calculated.

..Then you have to pay interest

For many companies in Mumbai, this first quarter has been almost zero. No business is done and there are no chances of quick sale. A garment company, which had a turnover of about Rs 10 crore last year and made a profit of Rs 25 lakh. On which his tax liability was Rs 7 lakh last year, if the situation were normal this year, then this garment company would have to pay tax of about one lakh rupees by June 15, but due to Corona, this time how much should he pay, the problem Its operator is confuse. And if tax is not paid, then they may have to pay 12% interest. Under compulsion, many companies are now opting to pay interest only after paying tax.

Dire situation: Mishra

Senior Chartered Accountant Narottam Mishra says that due to Corona, a serious situation has arisen for both the entrepreneur and the government. When the business itself is stagnant and the future ahead is uncertain, how can an entrepreneur calculate the tax and on the other hand if the government does not take tax, then how will its expenses be spent. How will the country run? The government also has helplessness. However, for the convenience of entrepreneurs, the government should consider taking advance tax in September instead of taking installment in June this year. If the government does this then it will be a big relief.