My brother giving 10 lakh in cash .. he is not giving cheque but ready to give me a gift deed.. Can i take that gift.. and also would it liable to any tax or penalty if i take it in cash
Hi,
Hope you are doing well !!
Yes, he can gift money to you.The amount will not be taxable in the hands of you.
However, income from that investment will be required to be offered in tax return.
Advised that a proper gift deed on plain paper should be executed and filed in respective tax files to explain to income tax department in case of any scrutiny.
Hi
If proper gift deed is executed, it should not be a cause of concern for you. However, your brother might be questioned for such source of money in cash.
What the limit of income tax audit 1 crore or 2 crore? Suppose if my turnover is 50 lakh and show the profit less then 8 percent than ot would be liable to audit..? Also if last year my turnover was 1.98 crore so i opted for persumptive scheme.. and this year my turnover cross 2 cross and then it would be laible to be audit.. what if next year my turnover will less than 2 crore would i laible to persumptive scheme or i would be barred for 5 years to opt it agian..? Also plz explian the audit limit 1 crore or 2 crore difference bw simple and persumptive scheme
Hi
If you opt for 44AD, limit for audit is 2cr; otherwise it is 1cr.
If profit is shown less than 8%(6% in case of digital transactions), tax audit becomes mandatory.
Yes, if turnover crosses 2cr, you cannot opt for 44AD and audit shall be mandatory.
If in subsequent year, turnover is less than 2cr, you shall be allowed to opt for 44AD.
An assessee is barred to opt for 44AD for 5 years if he is eligible to opt for 44AD and even then he doesn't opt for it. In you case, since turnover shall be more than 2cr, you won't be eligible for 44AD.
If turnover is less than 1cr and profit more than 6/8% - no audit.
If turnover is less than 1cr and profit less than 6/8% - mandatory audit.
If turnover more than 1cr and not opting for 44AD- mandatory audit.
If turnover between 1-2cr and opting for 44AD - no audit.
If turnover more than 2cr- can't opt for 44AD and hence audit mandatory.
If your brother can prove the source of such cash you can surely accept cash from your brother as gift just make a gift deed of such transaction as a proof.
Regarding your second query.
Audit limit is 1 crore but you can opt for presumptive scheme upto a turnover of 2 crore.
If your turnover exceeds 2 crore and you go for audit and if next year you again want to opt for presumptive income you can do that as you had not opt out of presumptive section you were forced to do that. Secondly if your turnover is below 2 crore and you show profit below 8% then you need to get your accounts audited and in that case you need to continue it for 5 years and you can't opt for presumptive income then.
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Thank you
Hi
Yes you can accept gift through gift deed. Declare it in your ITR as exempt income to avoid any departmental questions in future.
One crore limit is for audit.
Two crore apply when you opt for Presumptive tax scheme.
If you are eligible to opt for Presumptive tax scheme and you declare profit less than 8% the you have to get your account audited.
Yes you have to wait for five years to claim PTS.
Hope it helps
Dear Sir,
The limit of income tax audit 1 crore in normal cases.
The limit of income tax audit 2 cr- opting for presumptive taxation scheme u/s 44AD.
After option presumptive taxation scheme - If you declare profit less than 8% (6% in case of digital receipts)- Audit is mandatory.
So if you opt for presumptive continue for 5 years and if you want to opt out, you’ll be barred from resuming presumptive for a period of 5 years.
Your brother will need to prove the source of such cash, if he gets any notice from IT. You can surely accept cash from your brother as gift just execute a proper gift deed of such transaction as a proof of funds received.
Regarding your second query.
Audit limit is 1 crore but you can opt for presumptive scheme upto a turnover of 2 crore.
If your turnover exceeds 2 crore and you go for audit and in next year you again want to opt for presumptive income you can do so because you had not opted out of presumptive section, but you were forced to do that (due to law). Secondly if your turnover is below 2 crore and you show profit below 8% then you need to get your accounts audited and in that case you need to continue it for 5 years and you can't opt for presumptive income then.
