Summer Training

Summer Training at GSK Consumer Health Care limited, Nabha

Saurabh sabharwalForm 16 A 16 A form is TDS certificate for the professionals, contractors and persons providing things on rent. This form is issued by the company at the end of the financial year.Form 16 Form 16 is a salary Certificate issued by the company to its employees.TDS is deducted by the company every month from the salary of employees. Employees at the end of financial year can use the form 16 to claim refund from income tax authorities in case the Tax deducted is more than the actual.Investment declarationPreliminary declaration:- first of all employees give their preliminary declaration to the companies about various investment and expenses which are eligible for deduction from their salary for income tax purpose by filling the preliminary declaration forms containing various subheadings as follows:House rent paidLicULIPLong term infrastructure bondsNSCsHouse loan repayment and interestTuition fees of children, etc

Continued.System entry:- after employees have filled the preliminary declaration forms, companies make the system entry of the same.

Audit :- after the system entry companies do a audit of the system entries with the actual declaration made by the employees as a minor mistake can lead to wrong calculation of income tax of employees.ContinuedFinal declaration:- after all of the above steps are completed, then the employees are asked for final declaration. In the final declaration employees are asked to submit the proof of each investment or expense they have declared in the preliminary form. Only those investments are considered for which employees generate proof.Excise documentsRG 23 A (part II):- RG 23 A (part II) is a register maintained by the companies to record the transactions relating to the inputs used in the manufacturing of the products. Companies have to pay excise duty @10%,education cess 3%( 2% (education cess) + 1%(higher education cess)) in the inputs. This duty paid is considered at the time of output duty for deduction i.e. input credit is availed at the time of output. Input goodsInput means-

All goods, except light diesel oil, high speed diesel oil and motor spirit, commonly known as petrol, used in or in relation to the manufacture of final products whether directly or indirectly and whether contained In the final product or not and includes lubricating oils, greases, cutting oils, coolants, accessories of the final products cleared along with the final product, goods used as paint, or as packaging material, or as fuel. Or for generation of electricity or steam used in or in relation to manufacture of final products or for any other purpose, within the factory of production;

All goods except light diesel oil, high speed diesel oil, motor spirit, commonly known as petrol and motor vehicles, used for providing any output service.ContinuedRG 23 C (part II):- RG 23 C (part II) is a register maintained by the companies to record the excise duty availed on the capital goods. 50% credit of excise duty on capital goods is taken in current financial year and remaining 50 % credit is availed in the next financial year.Capital goodsCapital goods means:-The following goods, namely:-

All goods falling under chapter 82, 84, 85, 90, of the first schedule to the Excise Tariff Act;Pollution control equipment;Components, spares and accessories of the goods specified above;Moulds and dies. Jigs and fixtures;Refractories and refractory materials;Tubes and pipes and fittings thereof; andStorage tank,

Used-In the factory of the manufacturer of the final products, but does not include any equipment or appliance used in an office; orFor providing output service;

Motor vehicle registered in the name of provider of output service for providing taxable service as specified in sub- clauses (f), (n), (o), (zr), (zzp), (zzt), (zzw) of clause (105) of section 65 of the Finance Act. Form A. R. E 1Application for removal of Excisable Goods for Export by (Air/Sea/Post/Land)Form A. R. E 1 is filled by the companies which are exporting some material to its own branch in some other country. This form is filled to take rebate from the excise duty i.e. companies need not to pay any excise duty on such export. But company which want to avail such service has to sign a letter of undertaking with the excise department under Rule 19 of central excise law.C FormC Form is filled by the companies in case of inter state sale and purchase.Generally companies have to pay tax on intra state purchase @ 12%. But if the seller and buyer are authorized dealers having CST number, then by filling the C Form they can get heavy rebate on such tax and only tax at the rate of 1% or 2% is to be paid.F FormF Form is issued by the company in case of intra state branch transfer. By filling F Form the companies are exempt from paying any tax on transfer of such goods' Form is issued once in a month for one party.Differential Excise Duty Value of the goods vary from time to time. Thus the excise duty calculated on such value also differs. To counter the effect of such difference of excise duty differential excise duty is charged at the rate of 18% on the amount of variation.ESICESIC ( employee state insurance contribution) is an insurance scheme started by government for the employees of the company.Now a days, it is mandatory for every company to register its employees with the ESIC.Under this scheme employees contribution is 4.75% and employers contribution is 1.75% of the basic pay of the employee.TDSTDS is the tax getting deducted from the person the amount (Employee/Deductee) by the person paying such amount (Employer/Deductor). This is applicable for certain types of payments, as applicable under the Act.Presently this concept of TDS is also used as an instrument in enlarging the tax base. Some of such income subjected to TDS are salary, interest, dividend, interest on securities, winnings from lottery, horse races, commission and brokerage, rent, fees for professional and technical services, payments to non-residents etc. It is always considered as an Advance tax which is paid to the government.TDS Rates for 2010-11Male FemaleSenior CitizenTax (%)For Income Between 0 to 1,80,000For Income Between 0 to 1,90,000For Income Between 0 to 2,50,0000For Income Between 1,80,001 to 5,00,000For Income Between 1,90,001 to 5,00,000For Income Between 2,50,001 to 5,00,00010For Income Between 5,00,001 to 8,00,000For Income Between 5,00,001 to 8,00,000For Income Between 5,00,001 to 8,00,00020For Income above 8,00,001For Income above 8,00,001For Income above 8,00,00130Surcharge0Education Cess3Form VAT-2Value added tax is paid by the company at the treasury branch of any nationalized bank. After the payment is made the receipt of the same is submitted at districts central sales tax department. However, one copy of the vat form is to be submitted to the bank, another copy is to be submitted to local government department and last is to be retained by the party itself. However last months challan can be paid till 30th of the current month. And if its a WCT (work contract tax) then the tax of the last month is to be paid by the 15th of the current month. 18FORM VAT-2AThis form is same as Form VAT-2.The only difference between the two is that amount to be paid to the local municipal authority is 10% in this case and 98% of basic vat which is excluded from the surcharge in case of form VAT-2.However, this percentage is calculated on the tax charged to the party involved.FORM2-BInvoice of Tax paid into Treasury/Sub Treasury/ Branch of State Bank of India/ State Bank of Patiala or any other Bank authorized to transact Govt. business and credited to the Head of Account "_______Punjab Municipal Infrastructure Development Fund .Also amount to be paid to the local municipal office is 2% of basic vat which is excluded from the surcharge in case of form VAT-2.THANK YOU