LAL BAHADUR SHASTRI INSTITUTE OF

MANAGEMENT AND TECHNOLOGY, BAREILLY

SUMMER INTERNSHIP
PROJECT REPORT
ON

“FILING THE INCOME TAX RETURN OF

INDIVIDUALS”

Under the guidance of

Mr. Rajen Vidyarthi
(CHARTERED ACCOUNTANT)

SUBMITTED TO: SUBMITTED BY:

Mrs. Tanima Soni Diya Gupta

(PG-225006)
 ACKNOWLEDGEMENT

It gives me immense pleasure to present the report of a project undertaken

during the training in the second semester of PGDM at LAL BAHADUR
SHASTRI INSTITUTE OF MANAGEMENT & TECHNOLOGY,
BAREILLY UP. Upon successful completion of this training, I would
like to express my gratitude and thanks to my respected guide, Mr. Rajen
Vidyarthi for his precious guidance and insight into the practical aspects
of the training.

I would also like to convey my regards to Mrs. CA Ishita Oberoi

Vidyarthi and Mr. Mitul Vidyarthi for providing help and a congenial
environment during the completion of the training.

Further, I would like to give thanks to R.VIDHYARTHI & CO. for

allowing me to undertake my training under its esteemed banner and
allowing me to be a part of its healthy and cooperative environment.

Lastly, I thank the ALMIGHTY GOD who was with me during this
tenure to be a success.
 PREFACE

The purpose of writing this report is to explain and evaluate my

internship. During my internship, I have learned that what the importance
of tax is, why everyone should pay the tax, what are the benefits we get
after paying the tax & what is the procedure for filing the Income Tax
return.

When I had to choose the organization for my internship, my priority was

an accounting firm. Accounting is an essential part of an economy and
specifically for the student of Finance. Modern-day accounting is very
more advanced and fast than the traditional system. It provides an
opportunity to learn how to manage your tasks within the constraints of
time.

At R.Vidyarthi & Co. I was provided with the opportunity to deal with
real-time work, the accounts mechanism, functions, and operations. It
was an amazing experience working there with a cooperative staff and I
had so much to learn in these few weeks.
 DECLARATION BY THE STUDENT

Date: 18th August 2022

This is to certify that the Summer Internship Report entitled “FILING

OF INCOME TAX RETURNS OF INDIVIDUALS” is my original
work. This Summer Internship Report fulfills the requirement of the
“PGDM” diploma of this institute. It does not form the basis for the
award of any degree or diploma from any other institution or university.

Diya Gupta (PGDM 3rd SEM 2021-23)

Enrollment * - LBS25006
 EXECUTIVE SUMMARY

The internship report on the filing of income tax returns of Individuals.

The objective of the study was to get knowledge about taxation & ITR
filing. The other objectives are as follows: -

 How ITR will affect the Indian Economy.

 What is the importance of Taxation in our Indian Economy?

Primary data as well as secondary data were used to prepare this report.
This report was divided into a few parts such as industry & company
profile, work, and research, data analysis, and interpretation. The last part
is about the conclusion, recommendations, and limitations which are
drawn from the analysis of the whole study. The main findings of the
study are as follows: Overview of Taxation, Tax Deducted at Source.
Taxes are used by the government for carrying out various welfare
schemes including employment programmes. There are Lakhs of
employees in various departments and the administrative cost has to be
borne by the Government. There is a part of Data Analysis &
Interpretation in which we collect data from different clients and after
that we analyze to get better results. Some recommendations of the study
are: -they can adopt new technologies, ISO training programmes, they
can update their computer & laptop to increase the efficiency of work.
Overall learning from Internship duration: It has been the one of the most
important learning of my life. I have gained insights regarding how we
can save our tax with the help of deductions, building relationships
through clients, how to communicate with clients. The experience has
helped me to grow personality and taught me about not only the position
but also industry goals and initiatives.
 TABLE OF CONTENT

 Cover Page
 Internship Certificate
 Acknowledgment
 Preface
 Declaration by Student
 Executive Summary
 About Industry & Company Profile
 Introduction
 Mission & Vision
 Top 4 CA Firms in India
 Company Profile
 Departments of the Company
 Services Offering
 Objective of this Study
 Research Methodology
 Data Analysis & Interpretation
 Research Findings
 Overview of Taxation
 Overview of Tax Deducted at Source
 Recommendations
 Conclusions
 Limitations
 Bibliography
 Annexure
 PART II

ABOUT INDUSTRY &

COMPANY PROFILE
 INTRODUCTION

ABOUT ICAI

The organization is working as Chartered Accountants firm under the

rules and regulations and code of ethics designed for CA firms by ICAI
(The institute of Chartered Accountants of India).

The Institute of Chartered Accountants of India was established as a

statutory body on July 1, 1949, under the Chartered Accountants Acts,
1949 to regulate the profession of accountancy in the country.

ICAI is governed by the council which consists of Thirty-two members

elected by fellow members and up to eight members nominated by the
Government of India. The elected members of the council are elected
under the single transferable vote system by the members of the institute.
The council is re-elected every three years. The council elects two of its
members to be president and vice-president who hold office for one year.
The president is the chief executive authority of the council.

These kinds of firms provide different kinds of professional services like

audit, taxation, and management consultancy to their clients.

The Chartered Accountancy is conducted by the Institute of Chartered

Accountants of India, which has its headquarters in New Delhi, and 5
regional offices (Calcutta, Kanpur, Chennai, Mumbai, and New Delhi).
ICAI has 164 branches so far.

MISSION OF ICAI

Is to achieve excellence in professional competence, add value to

businesses and the economy, safeguard public interest; ensure ethical
practices and good corporate governance while recognizing the needs of
globalization.

VISSION OF ICAI

The profession of Chartered Accountants in India should be the

benchmark of professional excellence upholding the principles of
integrity, transparency, and accountability.

TOP 4 CA FIRMS IN INDIA

1. DELOITTE

Deloitte is the largest professional services network by revenue and

number of professionals in the world and is considered one of the
Big Four accounting firms along with EY, KPMG, and Price water
house Coopers.
Deloitte provides audit, consulting, financial advisory, risk
advisory tax, and legal services with approximately 334,800
professionals globally.
The Consulting services of industries work on the theory of
‘Providing practical perspectives and solutions to queries.’ Deloitte
 believes in ‘Good to make it great!’ They believe in ‘helping a
client to become Leaders’.

2. PWC

Price Waterhouse Coopers is the second largest professional

services network in the world. PWC firms are in 157 countries,
across 742 locations, with 284000 people. It manages the global
brand and develops policies and initiatives, to create a common and
coordinated approach in areas such as risk, quality, and strategy.
The firm believes in helping resolve complex issues and
identifying opportunities. People from all backgrounds such as arts,
business, economics, engineering, finance, health, information
technology, law, and more are entertained.

3. KPMG

KPMG is a multinational professional services network, and one of

the Big Four accounting organizations. Headquartered in
Amstelveen, Netherlands, although incorporated in the United
Kingdom, KPMG is a network of firms in 145 countries, with over
 236,000 employees, and has three lines of services: financial audit,
tax, and advisory.
KPMG was the preferred employer among the Big Four accounting
firms. It was also ranked No. 4 on the list of “50 Best Places to
Launch a Career" in 2009 according to Bloomberg Business Week.

4. Ernst & Young

Ernst & Young abbreviated as EY is a multinational professional

services partnership headquartered in London, England. It
primarily provides assurance (which includes financial audit), tax,
consulting, and advisory services to clients.
EY operates as a network of member firms that are structured as
separate legal entities in a partnership, which has 312,250
employees in over 700 offices in more than 150 countries around
the world.
 ABOUT THE COMPANY

R.Vidyarthi & Co. is a leading, oldest, and reputed Chartered

accounting firm in Bareilly. It is rendering comprehensive
professional services which include audit, management
consultancy, tax consultancy, accounting services, preparation of
projected balance sheet and provisional balance sheet, etc.

It is a professionally managed firm. The team consists of Two

Professional Chartered Accountants, Staff Members, and Articles.
The firm represents a combination of specialized skills, which are
geared to offer sound financial advice and personalized proactive
services. Those associated with the firm have regular interaction
with industry and other professionals which enables the firm to
keep pace with contemporary developments and to meet the needs
of its clients.

R.Vidyarthi & Co. has a clear vision for the future growth and
development of financial markets and services and researches to
stay ahead of those trends and developments.

DEPARTMENTS OF THE COMPANY

R.Vidyarthi & Co. is having its office in Bareilly. They consist of a

different number of departments that handle their respective functions.
The major departments include:

 Audit and Assurance Department:

 The firm provides audit and assurance services to a wide
range of clients which include performing audits of financial
statements of different companies, NGOs, and partnerships.
The firm also performs special assignments which include
management audits, internal audits, internal audits, and
investigations. The audit focuses on business issues and the
matters that can impact the financial statements, whilst also
retaining the basic audit procedures that test the information
contained in the financial statements. The firm always
endeavors to meet reporting deadlines as set out by the laws
and regulations or as mutually agreed with clients, without
compromising the professional, legal, and ethical
requirements.

 Tax Department:

The firm delivers taxation services to clients and assists

them in obtaining optimal tax benefits available under the
laws. The firm also assists clients to comply with the tax
rules and regulations and always keeps them updated with
the latest developments and amendments. Tax personnel is
qualified professionals, experienced and knowledgeable. We
maintain a comprehensive tax library that always provides
ready references and timely solutions in complex situations.
The firm provides a comprehensive range of tax services
which include:
 Preparation and submission of annual tax returns.
 Compliance services.
 Tax advisory services.
  Representation and litigation with tax authorities.
 Individual income tax services.

 Computer Department:

Department handles the computer-related matters and assists

other departments in working properly and efficiently. It
deals with the networking of computers in the office and all
other problems which may be faced by computer users from
time to time.

SERVICES OFFERING

 GST Registration:
GST registration of business is to enable the selling of
goods with turnover value beyond a certain limit that may
differ from state to state. It is necessary to get GST Input
Tax Credit. Experienced CA firms can ease the process with
reasonable fees.

 GST Return:
GST Return is a document that will contain all the details of
your sales, purchases, tax collected on sales (output tax),
and tax paid on purchases (input tax). Once you file GST
returns you will need to pay the resulting tax liability
(money that you owe the government).

 TDS Returns:
 TDS Return filling is a quarterly statement that is to be
given to the Income Tax Department. It is necessary to
submit the TDS return on time. TDS Return filling can be
done completely online. Once the TDS returns are submitted
the details will come up on Form 26 AS.

 Income tax (Salaried):

Income Tax returns of the salaried employee can be filed
with the help of Form 16 & Form 16A. Form 26 AS will
help you in getting information about TDS on salary.

 Income tax (Business):

Income Tax returns filing is a requirement of the Income
Tax Act for companies/businesses. Tax Audit reports help in
compliance with income tax laws.

 Tally Accounting:
Tally Accounting is software used for accounting purposes.
It is provided by Tally Solutions and is a standard business
accounting Software. Tally ERP is a very robust ERP
product and is a complete business management solution.
Tally is defined as a record, count, or a record of debit and
credit or an account.

 Internal Audit:
Internal Auditing is an independent, objective assurance and
consulting activity designed to add value and improve an
 organization's operations. An internal audit is not as
compulsory as a statutory audit.

 Statutory Audit:
A statutory audit is an independent assessment of the
financial accounts of a company or institution. The auditor’s
role is to report on whether the financial statements issued
by an organization are true and fair and meet all relevant
guidelines or legal requirements.

 Tax Audit:
A Tax Audit is the process of verification and inspection of
the accounts of a taxpayer to confirm their adherence to the
provisions of the Income Tax law. Section 44AB of the
Income Tax Act, 1961 deals with the Audit of the Accounts
of a certain category of persons carrying on a business or
engaged in a profession.

 Preparation of Projected & Provisional Balance Sheet:

The provisional balance sheet is prepared with past actual
figures but prepared before the end of the financial year (on
any specific date before the end of the financial year and
annual expenses of incomes are proportioned for a related
period). But the projected balance sheet is fully prepared
with estimated figures for future dates.

 Project Reports:
 A project report is simply a document that provides detail
on the overall status of the project or specific aspects of the
project’s progress or performance.

 CMA Data:
Credit Monitoring Arrangement, commonly known as CMA
Data is the financial report used by lending institutions to
appraise and analyze the financial position of a company
before lending.

 GST Compliance:
The GST Compliance rating is a score given by the
government to a business so that other businesses can see
how compliant they are with the tax department.
 OBJECTIVE OF THIS STUDY

I choose to work with R.VIDHYARTHI & CO. During this internship I

have learned many new skills. Before the internship, I have only
theoretical knowledge about working in an organization but now I have
practical experience of working in an organization. Now I know the
organization’s working environment and how organizations work and
achieve their goals and objectives.

This internship gives me an understanding of business and also about the

elements of strategic thinking, planning, and implementation, and how
these things are applied in the real world. Following are the objectives
that I have in my mind before working as an internee.

 To improve communication skills.

 To analyze business, the business situation.
 To establish a high standard of professionalism.
 To learn more than theoretical knowledge.
 To learn the bookkeeping practice of different companies.
 To make quick decisions in the real world.
 Develop organizational skills to complete the project promptly.
 Develop time management skills and the ability to be responsible
for more than one project at a time.
 Develop a solid work ethic & professional demeanor as well as a
commitment to ethical conduct & social responsibility.
 Expand networks of professional relationships & contacts.
 Enhance & expand the student’s knowledge of particular areas of
accounting.
 To know how to present your recommendations in front of your
boss.
 To compare practical aspects with theoretical aspects.
 To apply the theoretical knowledge in an actual organization.
 To enhance my knowledge and professional preparation for the
future.
 To get knowledge of opportunities and threats while entering into
an organization.
 Assist the student development of employer-valued skills such as

teamwork, strong communication, and attention to detail.

 RESEARCH METHODOLOGY

 Quantitative Research: Quantitative research is the process of

collecting and analyzing numerical data. It can be used to find
patterns and averages, make predictions, test casual relationships,
and generalize results to wider populations.
In my case, this method is used because I have collected large
number of data which is interpreted correctly. I have collected data
of bank statements, expenses, Fixed Deposit Receipt, GST on
purchases & on sales etc.

 Analytical Research: In analytical research, the researcher has to

use facts or information already available, and analyze these to
make a critical evaluation of the material. At the time of filing the
ITR i have received so many documents for e.g. bank statements,
FDR receipts, List of expenses, Details of Shares & Mutual Funds,
 I have to interpret the data to draw the matched Balance Sheet and
Profit & Loss A/C to undertaken an acute evaluation of the data.

 Descriptive Research: Descriptive research refers to the

methods that describe the characteristics of the variables under
study. This methodology focuses on answering questions
relating to the “what” than the “why” of the research subject.
We have asked the client, what is the nature of expenses or
businesses are there in their company.

DATA ANALYSIS & INTERPRETATION

This part involves all the necessary steps that are taken into consideration
while filing Income Tax return of Individuals, and the data given by the
clients and the analyses part are to be directly updated through Google
Sheets, and with that recorded data many more filtrations and analyses
have been performed.

This whole study includes various steps that are briefly described
according to format:

At the time of filing the Income Tax return of Individuals, client gave
us certain documents like:

 Bank Statements
 FDR Receipts
  LIC Premium Cover Note
 PPF A/C Statements
 Sukanya Samriddhi A/C Statements
 Form 16
 Bank reconciliation Summary
 Salary Sheets, PF & ESI Challans.
 Expenses Checking

The process of filing the Income Tax Return of Individuals:

 Download AIS, TIS & 26 AS.

 Preparation of Bank Summary.
 Preparation of FDR Receipt, Share A/C.
 Preparation of Balance Sheet, Profit & Loss A/C.
 Upload on Computax (Image shown below).

 Interpretation:
Data that we’ve collected through clients are just raw data that
need to be analyzed through a filtration process and import aspects
from that data need to be considered important and helpful for the
 decision-making process and evaluating the factors that impact the
income of clients.

 Data Analysis:
Several steps have been taken while preparing the data for its
usage, processes are briefly explained below:
 MS Excel: Raw data that I have collected, i have to make
various accounts, balance sheets & profit and loss A/C in
MS Excel, so that we can analyze it. We have to analyze
various aspects which help us in decision-making for current
and future planning for improving efficiency. At the time of
using the Microsoft excel I learn various shortcuts and tricks
to increase the efficiency of work.
 Filtration of Data: Data that can be filtered as per the need
of important information. At the time of filtration, I have to
keep relevant data, which is helpful at the time of analyses.

If I’ve to conclude the data analysis and interpretation part of

the report many important aspects of MS Excel through various
conditions are introduced by our guiders and they helped me
throughout my journey for better learning and to become a
close-to-perfect analyst in every situation.
 RESEARCH FINDINGS

Overview of Taxation
Taxes are considered to be the “cost of living in a society”. Taxes are
levied by the Governments to meet the common welfare expenditure of
the society. A tax is a mandatory fee or financial charge levied by any
government on an individual or an organization to collect revenue for
public works providing the best facilities and infrastructure. The collected
fund is then used to fund different public expenditure programs. If one
fails to pay the taxes or refuse to contribute towards it will invite serious
implications under the pre-defined law.

TYPES OF TAXES:

Be it an individual or any business/organization, all has to pay the

respective taxes in various forms. These taxes are further subcategorized
into direct taxes and indirect taxes depending on the manner in which
they are paid to the taxation authorities. Let us delve deeper into both
types of tax in detail:

1. Direct Tax –
 The definition of direct tax is hidden in its name which implies that
this tax is paid directly to the government to the taxpayer.
 From the government’s perspective, estimating tax earnings from
direct taxes is relatively easy as it bears a direct correlation to the
income or wealth of the registered taxpayers.
  The general examples of this type of tax in India are Income Tax
and Wealth Tax (but it is not applicable now).

2. Indirect Tax –
 Indirect taxes are slightly different from direct taxes and the
collection method is also a bit different. These taxes are
consumption-based that are applied to goods or services when they
are bought and sold.
 The indirect tax payment is received by the government from the
seller of goods/services.
 The seller, in turn, passes the tax on to the end-user i.e., buyer of
the goods/service.
 Thus the name indirect tax as the end user of the good/service does
not pay the tax directly to the government.
 Some general examples of indirect taxes include Goods and
Service Tax (GST).

THE INCOME TAX ACT, 1961

The Income-tax Act, 1961 is the charging statute of Income Tax in

India. It provides for levy, administration, collection and recovery of
Income Tax. The Government of India brought a draft statute called the
"Direct Taxes Code" intended to replace the Income Tax Act, 1961 and
the Wealth Tax Act, 1957. However, the bill was later scrapped.

The scope of Total Income depends on the category of a taxpayer and his

residential status in India. For example, a person resident in India is liable
to pay income tax in India on his total world income. On the other hand, a
person non-resident in India is liable to pay tax in India only on his Indian
income.
INCOME TAX CAN BE CALCULATED UNDER TWO REGIME:

 OLD REGIME –
Under the old structure of taxation, the assessee can claim the
deduction, exemptions and allowances with which they can have
proper tax planning and save taxes.
The existing tax structure is convoluted. Despite the high tax rates,
there are several strategies to lower your tax obligation. The
government has provided Indian taxpayers approximately 70
exemptions and deduction choices through the addition of sections
to the Indian Tax Act throughout the years, allowing them to
reduce their taxable income and hence pay less tax.
Some exemptions are included in your income, such as the House
Rent Allowances (HRA). And Leave Travel Allowances (LTA).
The deductions allow you to lower your tax obligation by
investing, saving or spending on specific items. Section 80C is the
most popular and generous deduction, allowing you to reduce your
taxable income by up to Rs.1.5 Lakh. Besides, there are several
more exemptions and deductions most widely available for
taxpayers.

Deductions and Exemptions Under Old Tax Regime :

 Deductions –
 Public Provident Fund
 Equity Linked Savings Scheme (ELSS)
 Employee Provident Fund
 Life Insurance Premium
 Principal and Interest component of Home Loan
 Children Tuition Fees
  Health Insurance Premiums
 Investment in NPS
 Tuition fee for Children
 Savings Account Interest
 Exemptions
 Standard Deduction
 Uniform Allowance
 Company Leased Car
 Food Coupons or Vouchers
 Mobile and Interest Reimbursement
 Leave Travel Allowance
 House Rent Allowance
Your taxable income might be reduced by lakhs due to a
combination of exemptions and deductions. Hence, tax planning is
imperative to maximize your income, savings, and investments
each year in order to limit your taxable income to a minimum.

SLAB RATE UNDER OLD TAX REGIME

 For Individuals
 NET INCOME RANGE FOR ASSESSMENT YEAR 22-23

Up to Rs. 2,50,000 NIL

Rs. 2.50,000 to Rs. 5,00,000 5%

Rs. 5,00,000 to Rs. 10,00,000 20%

Above Rs. 10,00,000 30%

 For Senior Citizens

NET INCOME RANGE FOR ASSESSMENT YEAR 22-23

Up to Rs. 3,00,000 NIL

Rs. 3.00,000 to Rs. 5,00,000 5%

Rs. 5,00,000 to Rs. 10,00,000 20%

Above Rs. 10,00,000 30%

  For Super Senior Citizens

NET INCOME RANGE FOR ASSESSMENT YEAR 22-23

Up to Rs. 5,00,000 NIL

Rs. 5.00,000 to Rs. 10,00,000 20%

Above Rs. 10,00,000 30%

 NEW REGIME –
It has six tax slabs, each having a lower rate on income up to Rs.
15 Lakhs. Multiple exemptions and deductions are not available
 due to the varying income slabs and tax rates. There are benefits
and drawbacks to the new tax regime.
In two ways, the new tax scheme differs from the previous one:-
1. The number of tax slabs has expanded under the new system,
with reduced rates in the range of Rs. 15 Lakh brackets.
2. In the new tax regime, all the exemptions and deductions that
taxpayers used in the old regime will be unavailable.

SLAB RATE UNDER NEW TAX REGIME

INCOME TAX SLABS NEW TAX RATES (WITHOUT EXEMPTIONS &

DEDUCTIONS)
Up to Rs 2,50,000 NIL

Rs 2,50,000 - 5,00,000 5%

Rs 5,00,000 – 7,50,000 10%

Rs 7,50,000 – 10,00,000 15%

Rs 10,00,000 – 12,50,000 20%

Rs 12,50,000 – 15,00,000 25%

Above Rs 15,00,000 30%

In simple words you can see that the income between Rs 5 lakh and Rs.
7.5 lakh is taxed at 10%, while income between Rs. 7.5 lakh and Rs. 10
lakh is taxed at 15% under the new system. For the current
administration, this was a 20% flat under the old structure of taxation.
The previous Rs. 10 lakh+ slab, which charged 30%, has been divided
into three sections, with rates of 20% for Rs. 10 lakh-12.5 lakh, 25% for
Rs. 12.5 lakh-15 lakh, and 30% for Rs. 15 lakh and above that.
UNDER INCOME-TAX ACT, THERE ARE FIVE HEADS OF
INCOME –

1. Taxable Income from Salary –

Salary Income refers to the compensation received by an employee
from a current or former employee for the execution of services in
connection with the employment. Thus, income is taxable as salary
under section under Section 15 only if an employer – employee
relationship exists between the payer and payee. Salary income
could be in any form such as gift, pension, gratuity, usual
remuneration and so on.

2. Taxable Income from House & Property –

A house property could be your home, an office, a shop, a building
or some land attached to the building like a parking lot. The
Income Tax Act does not differentiate between a commercial and
residential property. All types of properties are taxed under the
head ‘income from house property’ in the income tax return. An
owner for the purpose of income tax is its legal owner, someone
who can exercise the rights of the owner in his own right and not
on someone else’s behalf.
There are 3 types of house & property:
 Self-Occupied House Property
 Let Out House Property
 Inherited Property
3. Taxable Income from Business & Profession –
The term ‘Income from business and profession’ means any
income shown in profit and loss account after taking into account
all the allowed expenditures by an assessee.
 The income also include both positive (profit) and negative (loss).
In other words ‘profit and gains’ represent plus income while ‘loss’
represents minus income. So, both legal and illegal business
incomes are taxable in nature.

4. Taxable Income from Capital Gains –

Capital gain can be defined as any profit that is received through
the sale of a capital asset. The profit that is received falls under the
income category. Therefore, a tax needs to be paid on the income
that is received. The tax that is paid is called capital gains tax and it
can either be long term or short term.
Under the Income Tax Act, capital gains tax in India need not be
paid in case the individual inherits the property and there is no sale.
However, if the person who has inherited the property decides to
sell it, tax will have to be paid on the income that has been
generated from the sale. Some of the examples of capital
assets are jewelery, machinery, leasehold rights, trademarks,
patents, vehicles, house property, building, and land.

5. Taxable Income from Other Sources –

Income from Other Sources is one of the five heads of income
subject to taxation under the Income Tax Act, 1961. Any income
that is not covered in the other remaining four heads of income is
taxed under income from other sources. It is referred to as
residuary head of income. Incomes excluded from salary, house
property, business & profession (PGBP) or capital gains are
covered in Income from Other Sources, barring incomes that are
exempt under the Income Tax Act.
SOME IMPORTANT TERMS USED IN INCOME TAX ARE:

 Previous Year: As per the Income tax law the income earned in
current year is taxable in the next year. The year in which income
is earned is known as the previous year. In Layman language the
current financial year is known as the previous year. The financial
year starts from 1st April and end on 31st march of the next year.
 Assessment Year: The year in which your income is associated is
known as Assessment year. The period for assessment year starts
from 1st April and ends on 31st March of the next year. In other
words, it is the year immediately following the financial year i.e.
the year in which you have earned your income.

SOME IMPORTANT DOCUMENTS REQUIRED TO FILE ITR

ARE AS FOLLOWS:

 26AS: A form 26AS contains all tax-related information of a

taxpayer such as tax deducted at source (TDS), tax collected at
source (TCS), advance tax paid by the assessee, self-assessment tax
payments, details about income tax refunds, and the details of tax
deducted on the sale of immovable property, among other details.
 Annual Income Statement (AIS): Annual Information Statement
(AIS) is comprehensive view of information for a taxpayer
displayed in Form 26AS. Taxpayer can provide feedback on
information displayed in AIS. AIS shows both reported value and
modified value (i.e. value after considering taxpayer feedback)
under each section (i.e. TDS, SFT, Other information).
  Taxpayer Income Statement (TIS): Taxpayer Information
Summary (TIS) is an information category wise aggregated
information summary for a taxpayer. It shows processed value (i.e.
value generated after deduplication of information based on pre-
defined rules) and derived value (i.e. value derived after
considering the taxpayer feedback and processed value) under each
information category (e.g. Salary, Interest, Dividend etc.). The
derived information in TIS will be used for prefilling of return, if
applicable.

OVERVIEW OF TDS
Tax Deducted at Source (TDS) in India is a means of collecting tax on
income, dividends, or asset sales by requiring the payer (or legal
intermediary) to deduct tax due before paying the balance to the payee
(and the tax to the revenue authority). The types of income that are
subject to TDS include:

 Salary.
 Interest and Dividends.
 Winning from the Lottery.
 Insurance Commission.
 Rent.
 Fees from professional and technical services.
 Payments to contractors and subcontractors.

Under the Indian Income Tax Act of 1961, income tax must be deducted
at source as per the provisions of the Income Tax Act, 1961. Any
payment covered under these provisions shall be paid after deducting a
prescribed percentage of income tax. It is managed by the Central Board
for Direct Taxes (CBDT).

TDS Certificates -A deductor is required to issue a TDS certificate

called form 16 for salaried employees and form 16A for non-salaried
employees within a specified time. Form 16D is a TDS certificate issued
for payment of a commission, brokerage, contractual fee, the professional
fee under section 194M by the payer. Under section 194M if the
payments to resident contractors and professionals exceed INR
50,00,000. During the Financial year, the payer/ deductor has to deduct
tax at the rate of 5% from the sum payable to a resident payee/deductee.
Deductor has to issue TDS Certificates within two months of the financial
year.

There are two types of major forms under TDS namely:

Form 16: Form 16 is a certificate where the employer declares details

about the salary an employee earned during the year and details of
deducted TDS. Form 16 has two parts Part A and Part B. Part A consists
of employer and employee details, which includes name, address, PAN,
TAN details, employment period, and details of TDS deducted &
deposited with the government. Part B includes salary, income,
deductions, tax payable details, etc.

Form 16A: Form 16A is also a TDS Certificate but it is applicable for
TDS on Income other than Salary. This certificate features details such as
the name and address of the deductor or deductee, PAN/TAN
details, challan details of TDS deposited, income, and TDS deducted and
deposited on such income. Details from Form 16A will be fetched on
Form 26AS.

Section 194C of Income Tax Act, 1961

 Tax needs to be deducted 1% (for individual, HUF)/ 2% (for

others) of payment where payment is made for carrying out any
work (including supply of labor for carrying out any work and
advertisements) by a contractor/sub-contractor.
  Such work must be in pursuance of a contract (including sub-
contract) between the contractor and payer.
 TDS is to be made at the time of credit to the account of the
contractor or at the time of payment in cash or by cheque or draft
or by any other mode whichever is earlier.
 No TDS shall be deducted if the single-time payment to the
contractor does not exceed RS. 35,000 or Rs 10,00,00 in aggregate
during the year.
 TDS Can be deducted when the date of actual payment of cash or
the date of crediting the sum to the payee's account or the date of
issue of cheque, draft, or by any other mode, whichever is earlier.

Section 194J of Income Tax Act, 1961

Every person, other than an individual or a HUF, who is responsible for

paying to a resident any sum by way of –

(i) Fees for professional services; or

(ii) Fees for technical services; or
(iii) Any remuneration or fees or commission, by whatever name
called, other than those on which tax is deductible under section
192, to a director of a company; or
(iv) Royalty, or
(v) Non-compete fees referred to in section 28(VA) shall deduct tax
at source at the rate of

(a) 2% in case of fees for technical services (not being

professional Services) or royalty like consideration for sale,
distribution, or exhibition of cinematographic films; and
(b) 10% in other cases
 (c) However, in the case of a payee, engaged only in the
business of operation of the call center, the tax shall be
deducted at a source of @2%.

Threshold limit for deducting tax

 The tax has to be deducted in case the payment is greater than

30,000during the year. Such 30,000 is the maximum limit that
applies to each item or payment immediately.

Example: Firm XYZ paid 25,000/- as fees for technical services

and 20,000/- as professional charges to Mr. Red Here firm XYZ is
not liable to deduct TDS from payments made to Mr. Red as
30,000/- limit as separate for each item, namely fees for technical
services and professional charges.

 TDS under this section is also applicable on commission or

remuneration or fees are given to a company’s director. In these
cases, the 30,000 limit is not applicable.

Section 194H of Income Tax Act, 1961

Section 194H of the Income Tax Act deals with TDS levied on the
earnings received as commission or brokerage. This commission is the
amount paid to an entity for rendering services during a sale or purchase.

Both individuals and HUFs are liable to pay this tax. It is applicable on
income exceeding Rs. 15,000/-

The TAN of the deductor and PAN of the deductees are the most
important documents for TDS deduction.

When is TDS Deduction under Section 194H applicable?

An authorized entity can deduct TDS on brokerage under Section 194H
in the following cases:

 Crediting the commission in the account of the resident payee.

 Paying commission in any suspense account through cash, cheque,

or draft.

TDS is the tax deducted at source on the amount payable to the service
provider. It is then remitted to the Central Government of India. Only
authorized entities can deduct TDS. Neither an individual nor a HUF
(Hindu Undivided Family) can do so. The 194H threshold limit of
deduction is 15000.

Section 194I of Income Tax Act, 1961

Introduced by the Finance Act, 1994, Section 194I states that any person,
whether an individual or HUF who receives rent as income is liable for a
tax deduction at source when the income credited is more than
Rs.1,80,000 in the financial year. The limit is increased from Rs.1,80,000
to Rs.2,40,000 For FY2019-20. There is no surcharge unless the amount
is more than Rs.1 Crore. Rent paid to a government body/agency is
exempt from TDS.

Section 192 of Income Tax Act, 1961

All persons paying salary are responsible to deduct TDS on income

chargeable under the head “Salary.” In other words none of the payer of
salary is excluded; Individual, HUF, Partnership firms, companies,
cooperative societies, Trust and other artificial judicial persons have to
deduct TDS on Salary.
Any employee having taxable income under the head of “Salary” shall be
treated as payee for TDS u/s 192. For application of Sec.192, there must
exist employer employee relationship between payer and payee. For e.g.,

1. Director of company is not employee and such as no TDS u/s Sec

192 on any amount paid to Director.
2. Part-time Directors of the company, visiting professors & visiting
doctors are covered u/s 194J and not covered u/s 192. The whole-
time Directors are employees of the company and hence TDS is
deductible u/s 192.

Threshold limit

No tax is required to be deducted at source unless the estimated salary

exceeds the maximum amount not chargeable to tax. No TDS u/s 192 if
tax payable (after taking rebate u/s.87A) by the employee is NIL.
 RECOMMENDATIONS
Though the organization is good at everything and everything is well
maintained and managed. But still, there are some chances of
improvement whether it is a human being or any organization till
there are improvements and chances to develop and grow, the
organization must improve itself at its best. In my opinion, some of
the recommendations are:

 It is 6 days of working in the organization; most organizations

use 5-day working schedules so that employees don’t feel
exhausted and their efficiency increases. So the organization
must provide at least one day- of leave to the employees to
rest and freshen up.
 Some of the computers and laptops on which the work was
done were old and because of that, we were unable to carry
out our tasks properly. The organization must have proper
systems so that the workload can be handled efficiently.
 The infrastructure and working conditions reviews can
improve the working efficiency of the trainees.
 The working staff is limited, they can increase their staff to increase
work efficiency.
 Try to adopt new technologies that their competitors are not
using.
 They have a good opportunity to introduce the ISO standards
training program which no other firm is giving to customers.
 CONCLUSIONS
It can be concluded from the above discussion that Income Tax Return
filing is a sign that you are responsible. As the bank loan documents
process becomes easier for individuals. ITR receipts can be used for
address proof. If you want to claim adjustment against past losses, a
return is necessary.

Income Tax is one of the major sources of income for the government,
which is thereafter used to fund public services, payment of government
obligations and provide goods and services to citizens. Paying taxes not
only helps the government collect money to facilitate the needs of the
citizens of a country, but also helps the taxpayers get multiple advantages
if they pay their taxes on time. It’s important to also know why we, as
taxpayers, need to pay Income Tax.

 Income Tax is one of the major taxes in our country that every
earning individual and company needs to pay.
 The constitution of India gives its government to collect taxes in
order to provide services and goods to its citizens, to borrow
money in times of need or to prepare for war in case the need
arises.
 Furthermore, since Income Tax is one of the major taxes in our
country, it helps to fund most of the big projects such as meeting
the defense needs of a nation and development of the country.

The best Practices I Observed in the Organization are as follows:-

 Everyone is disciplined and dedicated to their job, thus motivating

us to do our jobs perfectly and to learn and grab as much as we
can. The perfect competitive environment always motivates us to
excel in our job responsibility and to perform better than we are
performing.
 The employees are always energetic and ready to do work; they
don’t waste their time. They always strive for excellence with
effectiveness and efficiency in their work. Even if the proprietor is
not at the office they don’t skip work hours.
 The proprietor is good at customer handling, he is always too
humble towards the clients even though if the clients are in a bad
mood or temper, he never loses his temper and handles them greet
fully. He never abuses his employees even if they do silly mistakes,
and corrects their mistakes by smiling and sarcastically
commenting on them so the employees don’t feel down and
eventually improve themselves.
 There is no racism based on any caste, creed, color, or gender.
Everyone is treated the same thus making it easy to coordinate with
each other and to share views and ideas. The mentors as well as the
colleagues are always ready to sort out any problem that the interns
could not resolve on their own.
 LIMITATIONS

In undertaking this study, some problems were faced are:-

 Incentives not provided: They do not provide the stipend for

internship.
 Confidential: I can’t disclose the name of clients.
 BIBLIOGRAPHY

 https://www.bajajfinservmarkets.in/gst/components-of-gst.html

 https://en.wikipedia.org/wiki/The_Income-tax_Act,_1961

 https://tax2win.in/tax-glossary/previous-year

 https://www.incometax.gov.in/iec/foportal/sites/default/files/2022-

07/Click%20Here_1.pdf

 https://en.wikipedia.org/wiki/Methodology
ANNEXURE