PROJECT REPORT ON

COMPUTERIZED ACCOUNTING AND

E-FILLING OF TAX RETURNS

Subject Name: Computerised Accounting and E-Filing of Tax Return

Subject Code : SEC 6.1 Chg

Year : 3rd Year

Semester : 6th Semester

Present Class : 6th Semester

CU registration number : 046-1111-0173-20

CU Roll no : 201046-1-0068

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Question Number Page Number Content
1 4-7  Introduction
 Application of Computer in Accounting.
 Advantages and Disadvantage of
computerized accounting system.
 Difference between Manual and
Computerized accounting systems.
2 8-13  Definition of different type of accounting
voucher.
 How to create, edit and delete a voucher.
3 14  Short cut keys in Tally ERP 9

4 15-21  Procedure in tally

 To create balance sheet
 Profit and loss account
 Trail balance
 Ratio analysis
5 21-28  To create, alter and delete of ledger account in
Tally.
 To create, alter & deleting company.
 To show or display the balance sheet, Profit &
Loss account. Ratio, Cash & Fund flow
statements.

6 29-31  E-filing Statement of Mr. ABC in old tax

regime & new tax regime of AY: 2023-24
(Using MS-Excel).
7 31-34  Short Notes:
 Advance Tax, Self-assessment tax, Form
26AS, Form ITR-V, Form 16, Annual
Information Statement (AIS), Taxpayer
Information Summary (TIS), Generated
Electronic Verification Code (EVC).
8 34-38  Definition of different sections of Income Tax
Act 1961:
 U/S 80CCC, U/S 80CCD, U/S 80GGC, U/S
80RRB, U/S 80EEA, U/S 80DD, U/S
10(13A), U/S 191, U/S 24(a), U/S 87A.

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Name : Aryan Prakash Das

CU Roll no : 201046-21-0068
CU Registration no. : 046-1111-0173-20

Signature :

Date :

3
 Computer is very helpful in accounting. All the interested parties of
financial statements can easily track all accounting reports if it is in connected
computers. That is the reason, today, all accounting departments make accounts
in computer. Before explaining the application of computer in accounting, we are
providing little introduction to those who are new for understanding this
important concept.

Application of Computer in Accounting :

1. To Keep Accounting Record of Big Company is Possible Suppose, you are the
accountant of big MNC. What you see in its business. There are millions of clients
from whole world. Is it possible to record all in manual basis. It will be
impossible. So, computer and accounting software in it, it will so easy to keep
unlimited accounting records without any risk of forgetting.

2. Separate Payroll Accounting is Possible

We all know top costly expense in the business is the salary of employees. So, it
must be recorded separately. Computer can help in this. Anytime any edit
regarding salary, name or any other adjustment in payroll is possible.

3. Automation of All Financial Accounts

Just go to any CA office. In its computer system, you will see lots of company's
financial statements and other accounting reports. How can company fastly send
its financial statements to CA office for audit. Answer is very simple. Everything

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has connected with computer. If accountant will pass voucher entries, financial
accounts will automatically be created by computer software.

4. Graphic Presentation of Accounting Results

Computer can be used for graphic presentation of accounting results. You can see
the sale trend graphs, charts and diagrams. Not only sale trend but you can see
anything in accounting area through graphic way. It will so easy and
understandable instead of reading only manual financial results.

5. Updated Fastly
If there is any mistake, we can easily correct. All the accounts will automatically
corrected. In manual accounting, it is not possible. There are lots of options which
can help more fastly providing the updated accounting reports. For example,
computer reminder system can send updated debtor balance to the customer.

6. Best Inventory Control

To record every small item in computer is so easy without keeping big inventory
registers. By comparing computer records of inventory and actual inventory,
anytime, we can check the difference and find the reason behind this difference.

In simple words, single computer has saved the cost of keeping hundred accounts
clerks. Without any errors, computer can records millions of transactions.

 Accuracy: As compared to paper-based accounting, computerized

accounting give more accurate results. In this system, data needs to be
entered and the rest of the calculation is done by a computer. Also, there
are lots of functions that are performed by accounting software including
reconciliation, period end adjustment etc. The head Accountant need not
check every time if a new member or staff enters new input data.

 Speed: The computer is already known for faster speed. When it comes to
accounting, it is faster than ever before. Everything can be created in
accounts with just one click.

 Security: The latest technology has developed integrated protection

software where accounts can be saved for a longer period of time. It also
gives password protection and access control.

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  Cost Efficient: Computerized accounting is efficient and economical than
paper based accounting. Nowadays some companies offer monthly
subscriptions at lower charges.

 Automation: In the case of invoice building software, invoices are

processed automatically and it saves time and energy. Once all the details
were entered, the computer automatically processed.

 Minimize Calculation error: calculation in a computer is error-free unless

the data is entered improperly.

Disadvantage of Computerized Accounting:

 High Cost of Installation: The cost of the Computer and its accessories are
costly. Computer hardware requires lots of maintenance, repair and
software need subscription fees. After some time of purchasing a system,
its new version comes into the market and makes the old system become
out dated.
 Training Cost: Operating a computer is not an easy task. A person needs to
be well trained and skilled to use a computer. Knowledge of accounting
software is also necessary to do accounting.

 Time-Consuming: Once there is any default in the system it takes a lot of

time and effort to restore the system. Sometimes computers work slow due
to weather and require air-conditioned room to work properly.

 Maybe Hacked: In today’s era, it is easy to hack someone’s security system.

Viruses and Malware can be entered into the system by hackers that cause
danger to data. New generation computer comes with strong security it can
combat this problem.

 Health Issues: It puts a lot of strain on the eyes. also excessive use of
computers leads to muscular pain which results in inefficiency and higher
health expenses to the employees.

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 Manual Accounting Vs. Computerized Accounting
BASIS FOR MANUAL COMPUTERIZED
COMPARISON ACCOUNTING ACCOUNTING

Meaning Manual Accounting is a Computerized Accounting

system of accounting that is an accounting system
uses physical registers that uses an accounting
and account books, for software, for recording
keeping financial records. financial transactions
electronically.
Recording Recording is possible Data content is recorded
through book of original in customized database.
entry.

Calculation All the calculation is Only data input is

performed manually. required, the calculations
are performed by
computer system.

Speed Slow Comparatively faster.

Adjusting entries It is made for rectification It cannot be made for

of errors. rectification of errors.

Backup Not possible Entries of transactions

can be saved and backed
up
Trial Balance Prepared when Instant trial balance is
necessary. provided on daily basis.

Financial Statement It is prepared at the end It is provided at the click

of the period, or quarter. of button.

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Ans: (a). Sales Voucher : Sales Voucher is used to record the Sales transactions
of the company. You can pass an entry using the Voucher mode or the Invoice
mode where the calculations can be automated and the transactions can be fed
into the system easily.

Purchase voucher : Voucher is a written,/documentary proof of payment. It is a

receipt given for cash paid or payment made through cheques. It support the
entry passed in the books of accounts. It gives full details, of payments made and
gives reasons for its payment.

Payment voucher : Payment voucher is used to account all the payments made
by the company by way of Cash/Bank. Payment voucher can be passed using
Single Entry or Double Entry mode by configuring the setting Use Single Entry
mode for Payment/Receipt/Contra in F12 configuration .

Receipt voucher : A Receipt Note voucher is used to record receipt of goods/items

at stores. For example , the Company receives new stock item from a Supplier. If a
Purchase Order exists for that supply, selecting the PO reference in the Receipt
Note will display its particulars.

Contra voucher : As per the Accounting Principles, a Contra entry is a transaction

involving transfer of cash between one Cash A/c to another or one Cash A/c to
another Bank A/c i.e., is a transaction indicating transfer of funds from:

● Cash account to Cash account

● Cash account to Bank account

● Bank account to Cash account

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● Bank account to Bank account
Journal voucher : Journal voucher in Tally is an important voucher which is used
to make all kind of adjustment entries, credit purchases or sales, fixed assets
purchase entries. In order to pass entries as journal voucher, we have to press
“F7” shortcut key from accounting Voucher screen on Gateway of Tally.
Credit note voucher : Invoices are an essential part of the sales process. Even
when the invoicing process is computerized, there is the possibility of the invoice
having an error. This may be a mistake in the quantity or the price or any other
item. A credit note is helpful in such a situation. A credit note is a legal document
used to cancel a previously issued invoice partially or in full. So, when you issue a
credit note, you can delete the amount of the invoice from the financial records
without having to delete the invoice itself. It is essential to use credit notes to
cancel an invoice as deleting an invoice may be unlawful. This is because the
original invoice is essential to maintain an audit trail.

Debit note voucher: Debit Note is a document issued to a party stating that you
are debiting their Account in your Books of Accounts for the stated reason or vice
versa. It is commonly used in case of Purchase Returns, Escalation/De-escalation
in price, any other expenses incurred by you on behalf of the party etc. Debit Note
can be entered in voucher or Invoice mode.

(b). Activate / Deactivate Voucher Types in TallyPrime

In TallyPrime you can activate / deactivate voucher types as per your business
need from voucher type creation / alteration screen.

To activate / deactivate voucher type.

Gateway of Tally > Alter > Voucher Type > type Sales Order > it will open
below mentioned screen.

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 Create Voucher Types:
Based on your business needs, you can create the required voucher types
in TallyPrime by grouping them under the pre-defined voucher types.
In this section

 Sales voucher type

 Manufacturing Journal Voucher Type

Sales voucher type

1. Gateway of Tally > Create > Voucher Type.

Alternatively, Alt+G (Go To) > Create Master > Voucher Type.
2. Enter the Name of the voucher.
3. Select the type of voucher as Sales.
4. Enter the abbreviation in the Abbreviation field, if required.
5. Select the Method of voucher numbering from the Methods of
Numbering list, which appears as shown below:

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6. Enable Use effective dates for vouchers to enter the effective dates
for vouchers. This option is useful when you have recorded a
transaction on a particular date, but the voucher comes into effect
only on a future date. If the effective date is entered, the
overdue/ageing will be considered from the effective date and not
from the voucher date.
7. Set the option Allow zero-valued transactions to Yes if required.
enabling this option will allow this voucher type to accept
transaction without any value.
8. Set the option Make this voucher type as ‘Optional’ by default
to Yes if you want the voucher to open as an optional voucher by
default.
9. Enable Allow narration in voucher to give a common narration for
the voucher.
10. Enable Provide narration for each ledger in voucher, if you
want to give a separate narration for each ledger selected in the
voucher. This will be useful when you want to provide specific
details for each ledger.
For Delivery Note, Receipt Note, Sales Order, Purchase order, Physical
Stock, Stock Journal, Rejection In and Rejection Out, the option
Provide narrations for each ledger in voucher is not available.
11. Set this option Enable default accounting allocations to Yes,
for all item invoice (except for the items specified), if required.
12. Enable Print voucher after saving to print every voucher
immediately after saving it.
Note: Depending on the Type of Voucher selected to create or alter,
different printing features appear in this field. For example, if you
select Receipt as Type of Voucher, the option Print Formal Receipt
after saving will be displayed.
If you want to know how to disable printing after saving the voucher
for a specific voucher type, then refer to Disable Print After Saving
for Voucher Types.
13. Set Use for POS invoicing to Yes to use the sales invoice as POS
invoice. If enabled for POS, set the Default title to print on invoice to
print the same title for POS invoice.
Note: You cann ot enable this option for default Sales voucher type,
you need to create a new voucher type under Sales to enable this
option.

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 14. Set Default title to print to Yes, to use the sales invoice
default title name to print.

15. Select the bank in Default bank option to print the default bank
ledger when the option Print Bank Details is enabled in a Sales
voucher.
16. Enter the Default jurisdiction to be printed on the invoice, if
required.
17. Set Set/alter declaration to Yes, if required.
18. Create a voucher class in the Name of Class field, if required.

19. Accept the screen. As always, you can press Ctrl+A to save.

Delete transactions recorded using a Voucher Type :

Before deleting transactions, you should take a Company data backup so that you
can restore those transactions by restoring the Company data in the future if
needed.

You can delete the transactions by drilling down on the Statistics report in
TallyPrime.

Follow the path given below.

1.Press Alt+G (Go To) > type or select Statistics and press Enter.

Alternatively, Gateway of Tally > Display More Reports > Statements of Accounts
> Statistics and press Enter.

2. Drilldown to the transactions.

a. Drilldown on the required Voucher Type.

The Voucher Monthly Register screen appears.

b .Drilldown on the months in which the transactions were recorded.

The Voucher Register screen appears where all the transactions for
the month are listed.

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 c.Select all the transactions using Spacebar and press Alt+D.

Statistics Report in TallyPrime for Deleting Transactions Using a Specific Voucher

Type

Similarly, you can delete vouchers recorded using the Voucher Types in other
months.

Delete a Voucher Type:

Now that you have ensured that there are no transactions recorded using the
Voucher Type, you can go ahead and delete the Voucher Type.

To delete a Voucher Type in TallyPrime, follow the procedure given below.

1. Press Alt+G(Go To) > Voucher Type > type or select the Voucher Type and press
Enter. Alternatively, Gateway of Tally > Alter > Voucher Type > type or select the
Voucher Type and press Enter.

2. Press Alt+D and then press Y to accept.

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Ans : (a).

Inventory Master Creation/Alteration Screen

Crtl+G To go to Stock Group Creation/Alteration screen.

Ctrl+C To go to Stock Category Creation/Alteration screen.

Ctrl+I To go to Stock Item Creation/Alteration screen.

Ctrl+O To go to Godown Creation/Alteration screen.

Ctrl+V To go to Voucher Type Creation/Alteration screen.

(b) Debit note : Click on Ctrl+F9

Credit note : click on Ctrl + F8

(c) Calculator in Tally : Click on Ctrl+N

(d) To repeat the narration in the voucher : Click on Ctrl+R

(e) To save the changes in the alteration mode: Click on Ctrl + A

(f) Transaction related to deposit and withdrawals : Press Alt+Q

(Reconcile) to reconcile the Cash Withdrawal/Deposit to Bank
transactions by specifying the Bank Date if the vouchers are not
reconciled.
(g) To view report in detail : Click on Alt + F1

(h) To toggle between the invoice and voucher screens : Click on

CTRL+F2

(i) To delete a voucher type : Click on Alt +D

(j) For vertical balance sheet : Click on Alt +F5

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Ans. a. Balance sheet : Just like every other report, the source for you to
prepare a balance sheet is from the transactions accounted in your books of
accounts. In the process of preparing the balance sheet, you need to prepare
other financial statements which will help you gather the accounting data. Let’s
start with a step-by-step process to prepare the balance sheet.

Step- 1: Prepare ledger accounts

Step-2: Create trial balance
Step- 3: Preparing trading and profit & loss account
Step-4 : Prepare balance sheet :
Now that you have prepared all the above statements, it’s time to prepare a balance
sheet. You need to consider all the ledgers which are non-revenue in nature. In other
words, all the ledgers except the one which you have already considered for the
Trading and Profit & loss account should be considered for the balance sheet. Broadly,
the balance sheet consists of assets and liabilities. In the process of preparing a balance
sheet, first, start with the assets side. Start capturing fixed assets ledgers like land and
buildings, furniture, etc., and then investments and all the current assets like cash,
Bank, Accounts receivables, Closing stock, etc.

Next step is to bring all the ledgers having nature of liability under the liabilities side
of the balance sheet. Remember, if there is any adjustment like depreciation, bad
debts, etc. you can do it in the balance sheet as well.

Once you have captured all details into the balance sheet, the assets side should be
equal to the liabilities side of the balance sheet. Only then, your balance sheet is
arithmetically correct.

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 b. Profit and loss account : You can view the Profit & Loss account
details in Tally.ERP 9 for a specified period.
To view the Profit & Loss Account
1. Go to Gateway of Tally > Display > Profit & Loss A/c.
2. Click F1: Detailed to view the Profit & Loss Account in detailed format.
The Profit & Loss Account appears as shown below:

16
 The Profit & Loss Account is generated and updated immediately from
the date of opening of books till the date of last entry.
3. Press F2: Period to change the period as required.
Horizontal Form of Profit & Loss Account.
The Profit & Loss A/c is in horizontal form, by default. You can view the
report in vertical format by enabling the option Show Vertical Profit &
Loss? by clicking F12: Configure. You can view additional information or
toggle to another report using the options available in the button bar.
Schedule VI Profit & Loss A/c
To view Schedule VI Profit & Loss A/c in Profit & Loss Account screen
● Click S: Schedule VI in the Schedule VI Profit & Loss A/c, as shown
below:

c. Trial balance:
1. Go to Gateway of Tally > Display > Trial Balance . The Trial
Balance appears as shown below:

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 2. Press F12 to configure the Trial Balance , as required.
3. Press Ctrl+A to accept.
The Trial Balance shows the flow of the accounts from the opening balance to
the effect of transactions on the closing balance.
● Press F12 to configure. The Configuration screen appears as shown
below:

After the configurations have been set, the Trial Balance appears as
shown below:

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Receipt Notes in Trial Balance
When a receipt note transaction is entered with a tracking number, it affects
the Trial Balance .
● Go to Gateway of Tally > Display > Trial Balance > F5: Ledger-wise .
The Trial Balance report appears.

The values of Purchase Accounts (Bills to come) is displayed in

the Debit field.
The values of Purchase Bills to Come is displayed in the Credit field.
The receipt note transaction does not affect ledger accounts, when it is entered
without tracking number. It is an inventory transaction; hence Trial Balance is
not affected . There will be increase in the stock quantity and stock value.
Group-wise Trial Balance in detailed mode
1. Go to Gateway of Tally > Display > Trial Balance > F5 : Ledger-
wise > F5 : Grouped > F1 : Detailed .
2. Click F12 : Configure .
3. Set Expand all levels in Detailed Format? to Yes . The group wise Trial
Balance appears.
4. To view the ledger details of the Sundry Creditors in detailed mode:

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 o Select Sundry Creditors field.
o Press Shift + Enter .
The group wise Trial Balance in detailed mode appears as shown below:

o In Sundry Creditors group, the value of stock for which the receipt
note is entered, but the purchase voucher is not yet accounted, is
displayed as Purchase Bills to Come under Credit .
o In Purchase Accounts group, the value of stock for which the receipt
note is entered, but the purchase voucher is not yet accounted, is
displayed as Purchase Bills to Come under Debit .

d .Ratio analysis : The Ratio Analysis Report is divided into two parts,
Principal Groups and Principal Ratios. The Principal Groups are the key figures
that give perspective to the ratios. Principal Ratios relate two pieces of
financial data to obtain a comparison that is meaningful.
● Go to Gateway of Tally > Ratio Analysis . The Ratio Analysis screen is
displayed as shown below:

1. Go to Gateway of Tally > Ratio Analysis .

2. Drill down from Racy. Turnover in days .
3. Select a party ledger and press Enter to drill down. The Ledger Payment
Performance screen is displayed as shown:

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 The Ledger Payment Performance statement displays the receivable turnover
in days. This is the balance outstanding in relation to the total sales made
multiplied by the total number of days in the period. This ratio should be used
in combination with the Average Performance of actual payments and the
payment history of the customer to assess how long he might take to pay the
outstanding balance.
The Actual payment history is given in the table for each invoice that was paid
by the customer. It shows when the invoice was paid, how long it was due and
what was the delay in payment. The customer's average performance is shown
at the bottom of the screen.

Ans: You can alter any information of the ledger master with the except for
the closing balance under the group stock-in-hand.
How to Create Ledger Account in Tally
Step 1: Use the following path to create ledger accounts in Tally Gateway of Tally
→ Accounts Info → Ledgers → Single Ledger → Choose Create

Step 2: Click on Accounts Info under Gateway of Tally screen.

Step 3: Choose Ledger option under Account Info.

Step 4: Under Single Ledger, choose the option Create

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Step 5: Update the following details on Ledger creation screen.

Name: Specify the unique name of the ledger account.

Under: Under List of Groups, choose the group name that pertains to the ledger
account.

In Tally, choose the "Yes" option under Accept to save the configured details.
To display/alter a ledger
● Go to Gateway of Tally > Accounts Info. > Ledgers > Display or
Alter.
Modification of account ledgers is possible for single ledgers as well as
multiple ledgers. However, for multiple ledgers, all the fields are not
available for alteration.
To delete a ledger
● Go to Gateway of Tally > Accounts
Info > Ledgers > Alter > Press Alt+D.
b).How to create, alter and deleting company ?
Ans : After the company creation in Tally, the given information of the company
can alter/ modify/ change as per requirement. Use the following steps to alter
company in Tally:

Step 1: Gateway of Tally → Press Alt+F3 → Alter

Step 2: Under "List of Selected Company", select the company name and click on
the name of company to alter as shown below:

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Step 3: On the screen of company alteration, add and modify the required details.
To save the details, use the Ctrl+A option. Here we are going to add contact
details of a phone number.

How to delete company

In Tally, if we delete the company, it can remove the company's complete

information from Hard disk. All the directories and files that are associated with
the company will be permanently deleted. This information cannot be reserved.

In Tally ERP 9, use the following path to delete the company:

Gateway of Tally → Alt+F3 → Alter → Alt+D

Step 1: The company information will display on the screen after using Alt+F3
keys. Here, the delete option will not be available. Now, click on the alter option.

Step 2: Now, click on Select Company and then click Alt+D. After this, click on the
YES option to delete the company.

How to Shut Company in Tally

In Tally, shut a company does not mean that delete a company, it means close.
After working with the company, choose the "Quit" button to close the present
company or press Alt+F1 if we chose more than one company.

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(c) How to create, alter and deleting of group ?
Ans : Create account groups one-by-one
1. Go to Gateway of Tally > Accounts Info. > Groups > Create ( under Single
Group)

2. Enter the Name of the group.

3. Enter the Alias name, if required.

4. In the field Under , from the List of Groups displayed, select the parent group
under which the group has to be classified. For example, Indirect Expenses

5. Click Yes to accept the screen.

A new group created under primary will not be reflected in reports until you
pass masters/transactions for that group.
Alter a Group

The details entered in a group can be modified when required.

1. Go to Gateway of Tally > Accounts Info. > Groups > Alter ( under Single Group ).

2. Select the name of the group required from the List of Groups displayed.

3. Make the necessary changes in the Group Alteration screen.

4. Click Yes to save the changes.

Create Multiple Groups in one-go

You can create, edit or delete multiple groups in Tally.ERP 9.

1. Go to Gateway of Tally > Accounts Info. > Groups > Create (Multiple Groups).

2. Select the group category in the field Under .

3. Enter the Name of the group. The screen appears as shown below:

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4. Select All Items in the field Under to create multiple groups of different categories.

Delete a Group
Groups can be deleted from the alteration screen. You cannot delete groups
from the Multiple group Alteration mode.
1. Go to Gateway of Tally > Accounts
Info. > Groups > Alter ( under Single Group ).
2. Select the group from the List of Groups .
3. Click D : Delete .
4. Click Yes to confirm deletion.

(d) ​How to show or display the balance sheet , profit and

loss A/c , Ratio, Cash and fund flow statements ?

Ans : View the Balance Sheet

1. Go to Gateway of Tally > Display > Balance Sheet .

2. Press F12 to configure the Balance Sheet .

3. Press Ctrl+A to accept.

25
 View Profit & Loss Account
1. Go to Gateway of Tally > Display > Profit & Loss A/c .
2. Click F1 : Detailed to view the Profit & Loss Account in detailed format.
The Profit & Loss Account appears as shown below:

The Profit & Loss Account is generated and updated immediately from the
date of opening of books till the date of last entry.
3. Press F2: Period to change the period as required.
The Profit & Loss A/c is in horizontal form, by default. You can view the
report in vertical format by enabling the option Show Vertical Profit &
Loss? by clicking F12: Configure . You can view additional information or
toggle to another report using the options available in the button bar.
4. Click S : Schedule VI in the Schedule VI Profit & Loss A/c

View Ratio Analysis Report

The Ratio Analysis Report is divided into two parts, Principal Groups and
Principal Ratios. The Principal Groups are the key figures that give perspective to
the ratios. Principal Ratios relate two pieces of financial data to obtain a
comparison that is meaningful.

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● Go to Gateway of Tally > Ratio Analysis . The Ratio Analysis screen is displayed
as shown below:

To view Funds Flow

1. Go to Gateway of Tally > Display > Cash/Funds Flow > Funds Flow .

2. Press Alt+F2, change period - From: 1-04-2008 to 31-8-2008. The funds flow
statement is displayed as shown below:

27
3. A Monthly Funds Flow Summary with the movement of working capital for each
month is displayed. It shows the Opening and Closing Balances of each month with a
column for Funds Flow.

4. Select a month and press Enter to drill down.

5. Select F1: Detailed to see the funds flow for the selected month.

28
VI. Mr. ABC earned INR 1.75 lakh per month in the last FY: 2022-23. He had also
earned interest from FD INR 35,530. He deposited 1 lakh, 1.25 lakhs and 50
thousand for GPF, PPF and LIC respectively in the FY 22-23. Besides this, he bought
health insurances, for which he paid premiums of INR 28,550 and 30,500 for his
family and parents (less than 60 years) respectively. Also, to save more taxes from
his earnings, he made additional investments of INR 10,000 in NPS in each month.
He also claimed a LTA amount of INR 25,000, which is tax exempted. He also
donated INR 75.000 in last financial year to an NGO for having 50% tax deduction.
Moreover, he is entitled to have HRA exemption is exact rent paid minus (-) 10% of
the (basic) salary (assume 50% of the monthly salary is considered as basic).

Show the step-by-step e-filing statement of Mr. ABC in old tax regime and new tax
regime for the AY: 2023-24 (probably using MS-Excel).

Note:

a. Additional 4% of basic tax liabilities is levied as Educational Cess.

b. Use separate excel sheets for calculating tax in old and new regimes.

c. Tax slabs in old and new regimes follow the guidelines defined by income tax
department, GOI.

Ans :

29
Financial Year 2022-23
Assessment Year 2023-24
Mr. ABC (Individual less than 60years )
CALCULATION UNDER NEW REGIME
Particulars AMOUNT (Rs.) AMOUNT (Rs.)
INCOME FROM SALARY
Salary (Rs.175000*12) 2100000
Less: Standard Deduction 50000
2050000
Less: LTA -
Less: HRA (50% of Basic Salary) - 2050000
INCOME FROM OTHER SOURCES
Interest on FD 35530
Interest Received (Saving) - 35530
GROSS TOTAL INCOME 2085530
Less: Deduction u/s 80C
Interest on FD -
LIC -
GPF -
PPF -
Maximum Deduction Allowed under section 80C - -
Less: Deduction under section 80CCD
NPS -
Maximum Deduction Allowed under section 80CCD (1B) - -
Less: Deduction u/s 80D
For Self to the maximum of 25000 2855 -
For Parents to the maximum of 25000 3050 - -
Maximum Deduction can be claim 50000/-
less: Deduction u/s 80G
Donation (claim 50% as deduction) - -

TOTAL INCOME 2085530

TOTAL INCOME ROUNDED OFF 2085530

TAX THEREON (WN-1) 363159
Less: Rebate u/s 87A -
Tax Payable After Rebate 363159
Add: Cess(4%) 14526.36
Add: Interest u/s 234A -
Add: Interest u/s 234B -
Add: Interest u/s 234F -
TAX PAYABLE 377685

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 TAX SLAB UNDER NEW REGIME
Financial Year 2022-23
TAX SLAB UNDER NEW REGIME
Financial Year 2022-23
Assessment Year 2023-24
Mr.ABC (Individual lessthan 60years )
PARTICULARS SLAB RATE AMOUNT
INCOME UPTO 250000/- NIL 0
RS.250000 - RS. 500000/- 5% 12500
RS.500000 - RS. 750000/- 10% 25000
RS.750000- RS.1000000/- 15% 37500
RS.1000000- RS.1250000/- 20% 50000
RS.1250000- RS.1500000/- 25% 62500
ABOVE RS. 1500000/- 30% 175659
363159
ADD: EDUCATION CESS @4% 14526
TAX PAYABLE 377685

Ans : . Advance tax Advance tax is also known as pay tax as you earn. It
should be paid in advance during the financial year instead of a lump sum
payment after the end of the year. You need to pay advance tax, if your estimated
total tax liability [after TDS] is Rs 10,000 or more in a financial year.
These payments have to be made in instalments as per due dates provided by the
income tax department. Advance tax applies to all taxpayers irrespective of the
profession, whether you are salaried, freelancer, or businessmen. However,

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Senior citizens, who are 60 years or more , and do not run a business, are exempt
from paying advance tax.

b. Self-assessment Tax : Self- Assessment Tax means the amount that an

assessee pays on the requisite income after deducting Advance Tax and TDS for
the given financial year. Individuals who are required to file their income tax
returns are liable to pay their SAT beforehand. A taxpayer can file SAT by
submitting Challan 280, also used for e-filing income tax.

There is no specific date for paying SAT as it is computed at the end of a financial
year. Hence, there is no deadline associated with the payment of such tax.
Nevertheless, taxpayers must make SAT payments before filing their respective
income tax returns to avoid paying interest on the tax amount.

c. Form 26AS: Form 26AS is a statement maintained and generated by the

Income Tax Department for each individual assessee (person). Income Tax Form
26AS is also known as an annual statement which contains all tax-related
information of a taxpayer. The details give a clearer picture of the tax
commitments of a taxpayer. It is associated with PAN. Form 26AS income tax
contains

1. Details of tax deducted from your income by deductors (TDS).

2. Details of tax collected by collectors (TCS).
3. Advance tax paid by the taxpayer.
4. Self-assessment tax payments.
5. Regular assessment tax deposited by the taxpayers (PAN holders).
6. Details of the refund received by you during the financial year.
7. Details of the High-value Transactions in respect of shares, mutual funds,
etc.
8. Interest received from banks & others without deducting any TDS as the
declaration is provided such as Form 15G / H in respect of low/no
deduction.

d. Form ITR-V : Income Tax Return Verification (ITR-V) is an acknowledgment

that the Income Tax Department sends after it successfully receives the income
tax return from the taxpayer. The last date to file the income-tax returns online is
July 31. After checking the verification, the applicant needs to take out a print of
it, sign it, and send it to CPC Bangalore so as to complete the process of filing the

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returns. After submitting it online to the Income Tax Department the user has the
leverage to check the ITR-V receipt status.

e. Form 16: Using Form 16 you can prepare and file your income tax return. It
shows the breakup of salary income and the TDS amount deducted by the
employer. It has two components – Part A and Part B (discussed in detail below).

If your employer deducted TDS from April ‘22 - March ’23, then Form 16 must be
issued on or before 15th June '23. If you lose your Form 16, you can request a
duplicate from your employer.
f. Annual Information Statement (AIS): The Income Tax Department
launched a new feature of AIS, which stands for Annual Information Statement, in
November 2021. It comprises the data of all financial transactions carried out by
a taxpayer in a financial year (FY). The authorities must upload all of this data in
Form No - 26AS in a taxpayer’s registered account. Thus, AIS is a comprehensive
statement comprising 46 financial transactions, including income, investment
and expenditure. The Government introduced AIS with the following objectives.

 It will display complete information to a taxpayer while capturing online

feedback.
 The Government expects it to promote voluntary compliance and advance
prefilling of return.
 It shall identify non-compliance from the taxpayers and deter it.

g. Taxpayer Information Summary (TIS): The Taxpayer Information

Summary (TIS) is an information summary for a taxpayer that has been
aggregated by category. Under each information category, it displays processed
value i.e. value produced as a result of information deduplication based on pre-
established rules and derived value i.e. value arrived at after taking taxpayer
feedback into account and processed value. The derived information in the TIS
will be used for prefilling of return, if applicable.

You will be shown various details within the Taxpayer Information Summary
such as,
• Information Category
• Processed Value
• Derived Value

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h. Generate electronic verification code (EVC): An Electronic Verification
code (EVC) is a 10-digit alphanumeric code which is sent on your registered
mobile to verify an item electronically, login to the e-Filing portal or used to reset
password. You can use the EVC to verify an item electronically (e-Verify statutory
forms, e-Verify Income Tax Returns, e-Verify Refund re-issue request, response
against any notice), login to e-filing portal or reset password.

Ans: U/S 80CCC : The Section 80CCC exemption limit includes the money spent
on the purchase of a new policy or payments made towards the renewal or
continuation of an existing policy.

The primary condition for availing this exemption is that the policy for which the
money has been spent must be providing a pension or a periodical annuity.

Section 80CCC is read along with Section 80C and Section 80CCD(1), thereby
limiting the total exemption limit to Rs. 1,50,000 per annum.

U/S 80CCD : Section 80CCD of the Income Tax Act, 1961 allows individuals to
get tax deduction by investing in the National Pension System (NPS) and the Atal
Pension Yojana (APY). The maximum tax deduction that an individual can claim
u/s 80CCD is ₹2 lakh in a financial year.

Section 80CCD deductions are divided into two subsections: Section 80CCD(1)
and Section 80CCD(2). This categorization is to distinguish pension fund
contributions made by the taxpayer (self) and contributions made by employers
on behalf of an employee. Currently, an individual can claim a deduction of up to
₹1.5 lakh under Section 80CCD(1) and an additional deduction of ₹50,000 under
Section 80CCD(1B) in a financial year.

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 Under this subsection of the Income Tax Act, contributions made by private or
self-employed individuals to National Pension System or Atal Pension Yojana are
eligible for tax deductions of up to ₹ 1.50 lakh in a financial year.
NPS contributions for government employees are also eligible for a similar tax
deduction under section Section 80CCD(1).

 Section 80CCD(1B): This subsection permits an additional tax deduction of ₹

50,000 over and above the contribution made under Section 80CCD(1).

 Section 80CCD(2): Under this subsection, contributions made by the employer

towards an employee’s pension fund is eligible for deductions under Section
80CCD(2). The deduction is limited to 10% of the employee’s basic salary plus
dearness allowance (DA).

U/S 80GGC: Section 80GGC of the income tax permits an individual to claim a
tax deduction for any donations or contributions made towards any political
party. So, if you opt for such tax deductions, you have the opportunity to save a
good portion of income tax under Section 80GGC apart from other exemptions
such as medical allowance, house rent allowance, etc.

Eligibility Criteria of Section 80GGC

Section 80GGC of the Income Tax Act allows any individual taxpayer to seek a
deduction. Furthermore, donations that qualify for deductions under Section
80GGC must be made by check, online banking, demand draft, debit/credit
card, or wire transfer. An individual's contributions towards any political party
or electoral commission in cash are not eligible for the deductions 80GGC of
Income Tax Act.

Political Party: A political party is an association or individual citizen's body of

India registered with the Election Commission and considered an election
body.

Electoral Trust: Electoral trust is a non-profit entity or Section 8 Company

created in India to receive voluntary contributions from any individual and
distribute the same to the respective political parties. The main objective of an
electoral trust is to distribute the contributions obtained by it to some political
party.

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U/S 80RRB: Section 80RRB is a tax deduction which a taxpayer can claim while
filing their income tax returns against payments received as royalty. Royalty
payments are a source of income for many citizens. A royalty is an amount paid to
a person by another party in exchange for using the recipient’s work.
This could include books, artwork, music, inventions, and so on. Royalty
payments are typically recurring and can last from a set period of time until the
recipient’s death. If you fall into this category and receive royalties for your work,
you can claim a tax deduction under Section 80RRB of the Income Tax Act of
1961

U/S 80EEA : In India, the Section 80EEA of the Income Tax Act helps first-time
home buyers with an extra facility of relaxation in the income tax . As per the
Section 80EEA income tax act, any first-time home buyer in India can earn an
additional tax deduction of up to Rs. 1.5 lakh. While buying a property that is
affordable and needs the support of a home loan, buyers can get benefits and
deductions under two Sections, i.e. 80EE and 80EEA deductions.
In the year 2014, the flagship project named Pradhan Mantri Awas Yojana
(PMAY) was launched with a mission of ‘Housing for All by 2022’. This was one of
several initiatives taken to encourage people to own their own property. In order
to further back such initiatives, the 80EEA deduction was introduced in the year
2019. Through this, the government extended its support with respect to home
loans applied between 01st April 2019 to 31st March 2021; eventually, this got
extended to 31st March 2022.

U/S 80DD : Section 80DD provides tax benefits to the families of disabled
dependents for the purpose of caring for them. It can be claimed by caretakers
who are individuals as well as by Hindu Undivided Families (HUF).

The Section 80DD provides deduction to families of disabled persons for the
purpose of caring for a disabled dependent. Deductions under Section-80DD can
be claimed by families of disabled dependents and not the dependents
themselves. If a disabled person has already claimed deductions on an amount
through Section 80U, the same amount cannot be claimed again as deductions
under Section-80DD.

Section 80DD can be claimed by both HUFs and individuals who are caring for a
disabled dependent. The deductions are applicable on expenses related to caring
for a disabled dependent. The deduction amount will also

36
cover insurance premium paid to specific insurers for the purpose of
maintenance of a disabled dependent.

U/S 10(13A): House rent allowance (HRA) is received by the salaried class. A
deduction is permissible under Section 10(13A) of the Income Tax Act, in
accordance with Rule 2A of the Income Tax Rules. You can claim exemption on
your HRA under the Income Tax Act if you stay in a rented house and get a HRA
from your employer.

The HRA deduction is based on salary, HRA received, the actual rent paid and
place of residence. The place of residence is important. For Mumbai, Kolkata,
Delhi or Chennai, the tax exemption on HRA is 50 percent of the basic salary,
while for other cities it is 40 percent of the basic salary.
The city of residence is to be considered for calculating HRA deduction.

The least value of these is allowed as tax exemption on HRA:

Actual rent allowance the employer provides as part of salary in the relevant
period during which the rental accommodation was occupied Actual rent paid for
the house, less 10 per cent of basic pay 50 percent of basic salary if you reside in
Mumbai, Calcutta, Delhi or Chennai, or 40 per cent if you reside in other cities.

In order to claim the exemption, the rent must actually be paid for the rented
premises which you occupy. READ MORE

Also, the rented premises must not be owned by you. As long as the rented house
is not owned by you, the exemption of HRA will be available up to the limits
specified.

For the purpose of this deduction, salary means basic salary and includes
dearness allowance, if the terms of employment provide it, and commission
based on a fixed percentage of turnover achieved by the employee.

The deduction is available only for the period during which the rented house is
occupied by the employee and not for any period after that. It is to be noted that
the tax benefits for home loans and HRA are two separate aspects.

In case you are paying rent for an accommodation, you can claim tax benefits on
the HRA component of your salary, while also availing tax benefits on a home
loan. You need to submit proof of rent paid through rent receipts, duly signed and
stamped, along with other details such as the rented residence address, name of
the owner, period of rent etc.

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U/S 191: Direct Payment
191. (1) In the case of income in respect of which provision is not made under this
chapter for deducting income-tax at the time of payment, and in any case where
income-tax has not been deducted in accordance with the provisions of this chapter,
income-tax shall be payable by the assessee direct.
(2) Save as provided in this Chapter, super-tax shall be payable by the
assessee direct.

U/S 24(a):
Section 24 of the Income Tax Act lets homeowners claim a deduction of up to Rs. 2
lakhs (Rs. 1,50,000 if you are filing returns for last financial year) on their home loan
interest if the owner or his family reside in the house property. The entire interest is
waived off as a deduction when the house is on rent.

U/S 87A
Under both the old and new income tax regimes, the amount of the refund under
Section 87A for FY 2021-22 2022-23 [(AY (2022-23) (2023-24)] has remained
unchanged. A resident individual with taxable income up to Rs 5,00,000 will be
eligible for a tax rebate of Rs 12,500, or the amount of tax payable (whichever is
lower). Under the new income tax regime, the amount of the rebate under Section
87A for FY 2023-24 (AY 2024-25) has been modified. A resident individual with
taxable income up to Rs 7,00,000 will receive a Rs 25,000 tax relief. The former tax
regime remains the same, i.e. 12,500 for income up to Rs 5,00,000.

How much is the rebate allowed u/s 87A?

If an individual’s total taxable income is up to Rs.7 lakh, they will be eligible for the
following tax breaks under the new regime for the fiscal year 2023-24:
 Rs.25,000 or the applicable tax(whichever is lower).
 It is the same as earlier Rs. 12,500 under the prior tax structure.

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