Project BBA 2

A STUDY ON INDIVIDUAL SALARIED EMPLOYEE TAXATION WITH REFRENCE TO DHANUSH
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Chapter 1: INTRODUCTION
Part A
 About the Industry

 Brief history
 Growth & Prospects
Part B
 About Subject
 Definition of the terms used
 Importance and other relevant aspects of the subject to the title of the study
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PART-A
1.1.1 INTRODUCTION
Auditors & Tax consultants who help their clients save money by making wise
financial decisions about tax-related issues. They interview clients to gather information about
their financial situations and devise strategies to help them reduce their tax liability by taking
advantage of tax credits and deductions. Tax consultants ensure their clients fulfil their tax
obligations and follow the law. This section explores some of the tasks tax consultants
perform each day and what it takes to succeed in the field. Specific job duties and areas of
focus vary by position. The best tax consultants enjoy solving problems and working with
people, demonstrating both accuracy and honesty in their work. Tax consultants help clients
with a variety of tax-related issues. Mainly, they make sure clients comply with tax rules and
regulations. They also use their expertise and knowledge of the U.S. tax code to help
individuals and businesses pay what they owe. These professionals help individuals and
organizations minimize tax liability by decreasing their taxable income and taking advantage
of all applicable adjustments, deductions, and tax credits. Dramatic changes in recent years
in the audit market suggest the timeliness of an investigation of trends in auditor
concentration and an extension of prior research (e.g. Danos and Eichenseher
1982).Auditors in recent press, large audit firms have claimed that specialization is a goal
of increasing importance. Peat Marwick, for example, has restructured along industry
lines, claiming to be recruiting professionals for national teams of multi-disciplinary
experts organized to “focus on the same industry to serve clients optimally.” On the other
hand, litigation concerns might prompt auditors to diversify their risks by diversifying
their clientele. In this study, we examine trends in industry specialization from 1976 to
1993 and the industry factors which may affect specialization; whether market share
increases are greater for audit firms classified as specialists; and whether the nation’s
largest audit firms have increased their market share in the industries which they have
identified as their focus industries. We find evidence that concentration levels have
increased over this period, consistent with the claims of the large audit firms. We find
that auditor concentration levels are higher in regulated industries, in more concentrated
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industries, and in industries experiencing rapid growth, but lower in industries with a
high risk of litigation. Levels of concentration have increased over time in nonregulated
industries providing evidence that scale economies or superior efficiencies of heavy-
involvement auditors are not limited to regulated industries but extend to nonregulated
industries as well. We also find that for the audit firms classified as market leaders at the
beginning of the year, market share has increased over time, whereas market share has
declined for firms with smaller share at the beginning of the year. This suggests that there
are returns to investing in specialization.
SERVICES:
1. Customized EHS and sustainability audit program scaled to review client’s

specific risks
2. Execution of EHS and sustainability regulatory compliance audits
3. Globalized protocol or country-specific protocol options
4. Detailed corrective action plans
5. Audit Program validation services
6. Data Analytics and Visualization for audit results
7. Multi-lingual with English speaking local EHS consultants and corporate
officials.
Key results:
1. Consistent audit approach around the world to reduce EHS compliance risks
2. On-site or virtual resources to help improve site awareness and application of
EHS and sustainability local, regional and federal legal requirements.
3. Ability to compare compliance status and trends by business unit, region, facility,
topic to track the impact of audits and health of the EHS program.
4. Assurance that EHS and sustainability risks are continuing to improve
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Principal Regression
To examine trends in auditor concentration, we estimate a regression with the three-firm

auditor concentration ratio as the dependent variable regressed against a time trend
variable; we include independent control variables for the regulated (unregulated) nature
of the industry, the concentration of firms in the industry, the relative litigation risk of the
industry, the average size of firms in the industry, high growth industries, and the number
of auditors claiming the industry as a specialty. We also include an interactive variable to
capture the trend over time for regulated versus nonregulated industries.
1.1.2 History
Origin of Audit the word audit comes from the word “Audre” (means to hear). In
general, it is a synonym to control, check, inspect, and revise. In early days an auditor
used to listen to the accounts read over by an accountant in order to check them. Auditing
is as old as accounting. It was in use in all ancient countries such as Mesopotamia,
Greece, Egypt, Rome, U.K. and India. The Vedas contain reference to accounts and
auditing. Arthasashthra by Kautilya also detailed rules for accounting and auditing of
public finances.
It wasn’t until the advent of the Industrial Revolution, from 1750 to 1850, that auditing
began its evolution into a field of financial accountability.
Mentioning (Key Audit Matters) KAM in an audit report is one of the major changes
brought about in audit reporting from financial year 2018-19 onwards. KAM are defined
as those matters that, in the auditor’s professional judgement, were of most significance
in the audit of the financial statements of the current period. KAM are selected from
matters communicated with TCWG. KAM are required to be communicated for audits of
financial statements of all listed entities – however an auditor may also voluntarily, or at
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the request of management communicate KAM. The following considerations are used in
determining matters of most significance.
Tax consulting is an important area

of taxation, it can provide legal
support to organizations
on various issues related to tax
payments and application of legal
means to the latter.
Tax consulting allows to stabilize
solvency and financial stability,
which are essential
characteristics of an enterprise
financial and economic activity. If
a company is financially
stable and solvent, it has priority
over other business units in
attracting investment,
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obtaining loans, selecting

suppliers and recruiting qualified
personnel. In addition, the
which are essential
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which are essential
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Tax consulting is an important area of taxation, it can provide legal support to
organizations on various issues related to tax payments and application of legal means to
the latter. Tax consulting allows to stabilize solvency and financial stability, which are
essential characteristics of an enterprise financial and economic activity. If a company is
financially stable and solvent, it has priority over other business units in attracting
investment, obtaining loans, selecting suppliers and recruiting qualified personnel. In
addition, the company does not collide with the state concerning tax remissions, payroll,
dividends, repayment of loans and interests.
It should be emphasized that tax consultants must possess many skills and not only in the
field of taxation. They must be knowledgeable in the areas of law, economics, finance,
accounting, production processes and constantly improve their skills in all these areas. As
a part of the author's opinion poll respondents were asked to give major tax evasion
reasons.
Tax awareness varies according to age, income and education level of respondents
(taxpayers). Better educated and wealthier citizens are more aware of the taxes they
should pay. It should be noted that Russian citizens are less tolerant to business leaders,
who evade paying taxes, rather than to ordinary workers, cheating the state. Thus, 57% of
respondents condemn big businesses evasion, and only 39% condemn their fellow
citizens.
1.1.3 INDUSTRY PROFILE
Auditing & Consultation Industry is the network of audit, tax and consulting
firms. Extensive experience in various facets of auditing and taxation services,
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notably corporate structuring and business restructuring advice across the full
spectrum of sectors, nationalities and regions, including cross-border structuring. A
dedicated team of multi-disciplinary professionals, featuring chartered accountants,
management graduates, legal and secretarial professionals and domain and industry
expert. Auditors are structuring services provide valuable insight into structuring
options for a person’s income tax filling and enabling you to maintain a disciplinary
value. Our teams have global market and sector knowledge combined with specialist
technical experience, offering you the right mix of technical, commercial and
operational expertise for the unique challenges you would be facing
1.1.4 Company Growth & Aspects

With the growing importance of investment banking across the globe, the auditor’s
functions are beginning to find worldwide acceptance. People are looking at these
auditor’s functions, with increased confidence. One of such functions is Tax
consultancy. However, these services are spread over a vast spectrum of corporate
activity. Some of them are very well suited for investment banks, with the rest finding
place with specialist consultancy firms. The essence of auditing and taxing services for an
individual salaried person relates to Business advisory, Restructuring advisory, Project
advisory and Merger & Acquisition advisory. Auditor as well as Tax consulting
Services is an umbrella term that encompasses specialized advice’s rendered to corporate
houses by professional advisers such as Chartered Accountants, law practitioners and
host of similar service providers. Previous analysis from Consultancy.in demonstrated
that the Indian business and management consulting market is forecast for 6% growth
over the next year, coming on the back of 6% growth since last year as well. The market
is estimated to reach a value of $12.348 billion by the next year.
Aspects:
1. Review of all Systems
The primary objective of any audit is the review of all systems and procedures that relate to
the accounting and financial processes. The auditor must first understand the system and its
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functionality before he started with the audit of the final statements of accounts. It will be
the base of the entire auditing exercise.
2. Review of the Internal Controls

The effectiveness of the organizations internal control system will dictate the scope of the
audit. If the internal controls of the company are in place and very effective, then the auditor
can rely on the system. Then he need no go through the accounts very minutely. However, if
on the other hand the internal controls are not effective, the auditor has to go through the
accounts with a fine tooth comb. And as per CARO 2003, it is compulsory for the auditor to
review the internal control system.
3. Arithmetical Accuracy
The auditor must also routinely check the accuracy of the books of accounts. This includes
checking the arithmetical accuracy of the books, by ensuring the posting of the entries is
perfect.
4. Accounting Principles
The auditor must ensure that proper distinction is made between the capital and revenue
transactions. All financial transactions must be properly categorized as either revenue or
capital transactions. The auditor must also check the items of both income and expenditure
for their accuracy.
5. Verification of Assets
The auditor must physically verify all the assets of the company. So he must check all the
legal documents, certificates, official statements etc. to analyse the ownership of all assets.
The auditor will also have to ensure no assets have been left out of the balance sheet either.
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6. Verification of Liabilities
The auditor must also verify all the liabilities of the organization. Again he will inspect all
documents, letters, certificates etc. If necessary he can ask third parties for confirmation as
well.
7. Vouching
Ever financial transacting leaves a paper trail. The auditor has to examine these supporting
documents to check the existence and accuracy of these transactions. This is known as
vouching. For example the organization has shown an electricity expense of 12,000/-. Then
the auditor must inspect the electricity bill to cross check this transaction.
8. Statutory Compliance
It is the duty of the auditor to check that the financial records of the company are in
compliance with all the laws, rules and regulations in effect at any given time. So he must
make sure that the accounts are in compliance with the Companies Act 2003, Income Tax
Act 1961 etc.
1.1.5 Government Initiatives / Guidelines
1. Independence
The general standards for the auditor and the audit institutions include independence from
the legislature, independence from the executive, and independence from the audited
entity. Whatever the form of government, the need for independence and objectivity in
audit is vital. An adequate degree of independence from both the legislature and the
executive branch of government are essential to the conduct of audit and to the credibility
of its results.
2. Competence
The auditor and the SAI must possess the required competence. The following
paragraphs explain competence as an auditing standard: The mandate of a SAI generally
imposes a duty of forming and reporting audit opinions, conclusions and
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recommendations. Discussions within the Audit Department promote the objectivity and
authority of opinions and decisions. Since the duties and responsibilities thus borne by
the SAI are crucial to the concept of public accountability, the SAI must apply to his
audits, methodologies and practices of the highest quality. It is incumbent upon it to
formulate procedures to secure effective exercise of its responsibilities for audit reports,
unimpaired by less than full adherence by personnel or external experts to its standards,
planning procedures, methodologies and supervision.
3. Due Care
The general standards for the auditor and the SAI include due care in specifying,
gathering and evaluating evidence, and in reporting findings, conclusions and
recommendations. The following paragraphs explain due care as an auditing standard:
The SAI must be, and be seen to be, objective in its audit of entities and public
enterprises. It should be fair in its evaluations and in its reporting the outcome of audits.
4. Quality Assurance Review
SAI should have an appropriate quality assurance system in place. The following
paragraphs explain quality assurance reviews as an auditing standard, because of the
importance of ensuring a high standard of work by the audit department, it should pay
particular attention to quality assurance programs in order to improve audit performance
and results. The benefits to be derived from such programs make it essential for
appropriate resources to be available for this purpose. It is important that the use of these
resources be matched against the benefits to be obtained.
5. Other General Standards for Audit Institutions
The SAI should adopt policies and procedures to recruit personnel with suitable
qualifications and train them professionally. SAI personnel should possess suitable
qualifications and be equipped with appropriate training and experience. The SAI should
establish, and regularly review, minimum training requirements for the appointment of
auditors at each level within the organisation. The SAI should adopt policies and
procedures to develop and train SAI employees to enable them to perform their task
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effectively and to define the basis for the advancement of auditors and other staff. The
following paragraphs explain training and development as an auditing standard.
PART-B
1.2.1 INTRODUCTION
In other words all arrangements by

which the tax is saved
by ways and means, which
comply with the legal
obligation and requirements and
are not colorable devices
or tactics to meet the letters of
law but not the sprite
behind these, would constitute tax
planning. Tax planning
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should not be done with an intent

to defraud the revenue,
All transactions entered into by
an assessee could be
legally correct, yet on the whole
these transactions may be
devised to defraud the revenue.
All such devices where
status is followed in strict words
but actually spirit behind
the statute is marred would be
termed as colorable devices
and they do not form part of
the tax planning. All
transactions in respects of tax
planning must be in
according with the true spirit of
statute and should be
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correct in form and substance.

The form and substance of a
transaction is real test of any
tax-planning device. The form of
transaction, as it appears
superficially and the real intention
behind such transaction
may remain concealed. Substance
of a transaction refers to
lifting the veil of legal
documents and ascertaining the
intention of parties behind the
transaction.
Taxplanning isthe
arrangementofone’saffairsi
nsucha
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manner that the tax planner may

either reduce the incident
of tax wholly or reduce it to
maximum possible extent as
may be permissible with in the
framework of the taxation
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planning must be in
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transaction.
nsucha
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planning must be in
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transaction.
nsucha
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In other words all arrangements by which the tax is saved by ways and means, which
comply with the legal obligation and requirements and are not colourable devices or
tactics to meet the letters of law but not the sprite behind these, would constitute tax
planning. Tax planning should not be done with an intent to defraud the revenue, All
transactions entered into by an assessed could be legally correct, yet on the whole these
transactions may be devised to defraud the revenue. All such devices where status is
followed in strict words but actually spirit behind the statute is marred would be termed
as colourable devices and they do not form part of the tax planning. All transactions in
respects of tax planning must be in according with the true spirit of statute and should be
correct in form and substance. The form and substance of a transaction is real test of any
tax-planning device. The form of transaction, as it appears superficially and the real
intention behind such transaction may remain concealed. Substance of a transaction refers
to lifting the veil of legal documents and ascertaining the intention of parties behind the
transaction. Tax planning is the arrangement of one’s affairs in such a manner that the tax
planner may either reduce the incident of tax wholly or reduce it to maximum possible
extent as may be permissible within the framework of the taxation land. It does not
amount to evasion of tax. It is an act of prudence and farsightedness on the part of the
taxpayer who is entitle to reduce the burden of his tax liability to the maximum possible
extent under the existing law. Tax planning ensures not only accruals of tax benefit with
in the four corners of law, but it also ensures that the tax obligations are properly
discharged to avoid penal provision. A compulsory payment made by a business,
individual or other entity, to the government.
KEYWORDS:
Taxation, Tax saving Instruments, Tax Planning, Tax Management, Tax Evasion and Tax
Avoidance
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1.2.2 Types of taxes are:
1. Direct Tax:
The tax in which impact and incidence is on the same person or body. In simple terms,
the tax payer is liable to pay the tax directly to the government or authority that imposed
it. These taxes are progressive in nature, i.e. , the tax rates increase with the increase in
the income (this effect will be demonstrated shortly under the ‘Tax Slab’ section) . Direct
Taxes have a limited tax base. Just a little over 1% (1.46 crore) actually pay direct taxes.
One of the reasons is that not everyone earns enough income to qualify for direct taxes.
For example, adult citizens with an annual income of less than ₹2, 50,000 are not liable
to pay any income tax. Direct Tax payers also have freedom to avail various deductions,
under the Income Tax Act, in order to reduce their taxable income, and ultimately their
tax liability. Direct taxes include income taxes, property taxes, and taxes on assets.
2. Indirect Tax :
The tax in which impact and incidence is on different persons. In simple terms, indirect
tax is a tax collected by an intermediary (such as a retail store) from the person who bears
the ultimate economic burden of the tax (such as the consumer) and paid to the
government. Examples of indirect tax is sales tax, per unit tax, value added tax (VAT), or
goods and services tax (GST), excise, consumption tax, tariff, etc.
1.2.3 Tax System in India

India has a structured tax system and the importance of taxes are defined by two
attributes - progressive and proportional. It is progressive in that the tax is levied at
increasing rates to increasing brackets of income and revenue. Meanwhile, it is
proportional in that the rate of tax levied is in proportion to the amount of income or
revenue it is being levied upon.
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Any changes in tax rates, brackets and slabs are determined largely by the central and
state governments and must be accompanied by a law passed by the Parliament or State
Legislature.
1.2.4 Importance of Income Tax:
Now that we understand the types of taxes in the Indian tax structure, let us review the
importance of taxes as understood by this distinction.
Importance of Direct Taxes

Direct taxes display the importance of taxes by reducing income equalities with its
progressive tax structure. Citizens are taxed in proportion to their economic
circumstances, thereby encouraging social and economic equality. Moreover, with direct
taxes, taxpayers remain aware of how much tax they can be expected to pay in a financial
year and prepare well in advance. Direct taxes are also useful in controlling inflation as
any change in their rates can help in regulating demand and supply in the economy.
Importance of Indirect Taxes

The importance of taxes for the government when it comes to indirect taxation is that
they are an automatic function that accompany the buying and selling of goods and
services across the country. They are therefore easy to collect and convenient for both
taxpayers and the tax collection authorities. They also help broaden the country’s net of
tax liabilities, gathering contributions from those sections of society that are otherwise
exempted from direct tax.
1.2.5 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.
Under Section 2 (31) of Income Tax Act 1961, a Person includes:
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 Individual (Sole Proprietorship)

 Partnership including LLP
 HUF (Hindu Undivided Family)
 Company
 Body of Individuals
 Association of Persons
 Artificial Judicial Person (EX: Trust)
Tax Evasion:
It refers to a situation where a person try to reduce his tax liability by deliberately
suppressing the income or by inflating the expenditure showing the income lower than
the actual income and resorting to various types of deliberate manipulations. An assessed
guilty of tax evasion is punishable under the relevant law. Tax evasion may involve
stating an untrue statement knowingly, submitting misleading documents, suppression of
facts, not maintaining proper accounts of income earned (if required under the law)
omission of material facts in assessments. An assessed, who dishonestly claims the
benefit under the statute by making false statements, would be guilty of tax evasion.
Tax avoidance:
The line of demarcation between tax planning and tax avoidance is very thin and blurred.
There could be element of mollified motive involved in the tax avoidance also. Any
planning which, through done strictly according to legal requirements defeats the basic
intention of the legislature behind the statute could be termed as instance of tax
avoidance. It is usually done by adjusting the affair in such a manner the there is no
infringement of taxation laws and b taking full advantage of the loopholes there in so as
to attract the least incidence of tax.
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Financial Year:
Financial Year is the year in which the income is earned. It can be less than or equal to 12
months , depending upon the number of days or months an individual or business has
worked or functioned for in a year , or the date when they started earning income. In
India, it normally begins on 1st April of the first year and ends on 31st March of the next
year. The current financial year is 2020-21.
Assessment Year:
The year in which income earned in the financial year is both assessed and taxed is called
the assessment year. It comes after financial year. The current assessment year is 2021-
22.
Cess:
Cess is a form of tax charged/levied on the tax liability of an individual taxpayer. A cess
is usually imposed additionally when the state or the central government looks to raise
funds for specific purposes. The government can impose cess for purposes such as
disaster relief, generating funds for cleaning rivers, etc.
Cess is not a permanent source of revenue for the government, and it is discontinued
when the purpose levying it is fulfilled. It can be levied on both indirect and direct taxes.
The present cess rate is 4% on the tax liability.
Taking our previous example, Mr Mohan’s Cess will be 4% of ₹1, 00,000, which is
₹4,000. Hence, he has to pay his original tax liability along with the cess to the
government. The sum total of tax and cess is ₹1, 04,000 in our case.
Deductions:
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Deductions for the individual is mentioned under Chapter VI A, Section 80C – 80U.
These deductions are fixed for an individual and are used to finally arrive at the taxable
income.
Taxable Income = Salary (or Income) – Deductions
Finally, tax is calculated on the taxable income using the Slab Rate system that we
previously discussed.
Other than Chapter VI A deductions, there are two other main deductions:
Standard Deduction – An additional sum of ₹50,000 is compulsorily deducted from the
salary (or income), in order reduce the taxable income, which reduce, and in some cases
eliminated, the ultimate income tax payable to the government.
Professional Tax – This deduction is a exclusively available only to salaried persons. A
sum of ₹200 is deductible from the taxable income for every month that the salaried
individual has worked. If the person has toked for 12 months, his Professional Tax
deduction will be ₹200 x 12 = ₹2400.
1.2.6 Tax Slabs (with example )

The Tax Slabs simply mean different tax rates are prescribed for different ranges of
income. The tax rates keep increasing with an increase in the income of the taxpayer.
This type of taxation enables progressive and fair tax systems in the country.
The tax rates in the New tax regime is the same for all categories of Individuals, i.e. ,
Individuals & HUF up to 60 years of age, Senior citizens above 60 years up to 80 years ,
and Super senior citizens above 80 years.
Given below is the table denoting tax rates for Individuals and HUF based on the new
system:
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New Regime Income Tax Slab Rates for

Income Tax Slab FY 2020-21
(Applicable for All Individuals & HUF)
Rs 0.0 - Rs 2.5 Lakhs NIL
Rs 2.5 lakhs- Rs 3.00 Lakhs
5% (tax rebate u/s 87a is available)
Rs. 3.00 lakhs - Rs 5.00 Lakhs
Rs. 5.00 lakhs- Rs 7.5 Lakhs 10%
Rs 7.5 lakhs - Rs 10.00 Lakhs 15%
Rs 10.00 lakhs - Rs. 12.50 Lakhs 20%
Rs. 12.5 lakhs- Rs. 15.00 Lakhs 25%
> Rs. 15 Lakhs 30%
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Chapter 2: RESEARCH DESIGN
• Title of the study.
• Statement of the problem. (Reason for selecting the topic)
Review of literature
• Objectives of the study.
• Scope of the study.
• Limitations of the study.
• Operational Definition of Concepts.
• Methodology of the study
i. Type of Research (descriptive/ analytical/exploratory etc.)
ii. Reference Period (in case of financial analysis)
iii. Sampling Method adapted.
iv. Sample Size (100)
v. Type of Data Collection.
vi. Research Instruments. (Questionnaire)
vii. Plan of Analysis. (Statistical tools used)
• Chapter Overview
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RESEARCH DESIGN
2.1 TITLE OF THE STUDY
A study on Individual Salaried Employee Taxation with reference to Dhanush Associates

Auditors & Tax Consultants Ltd.
2.2 STATEMENT OF PROBLEM
Tax payers normally turn away of their tax liability only towards the end of financial
year. This leaves them with little option to invest or save with available income. The real
issue would relate to having awareness on the numerous provisions that would help in
reducing the tax liability. Investments come in the form of physical assets and financial
assets with varying yields. The complete understanding of the opportunities available and
managing one’s finance considering tax liability and Post tax cost are crucial as far as
personal finance is concerned. The current study is an effort to evaluate “Income tax or
Taxation “measures adopted by the salaried employee or an individual, income tax
assesses of the state in the light of tax administration measures being implemented by the
government.
2.3 REVIEW OF LITERATURE
1. RAJINI BEDI (2007)

Studied and evaluated performance, reforms and incentives of personal income tax
systems in India. The period opted for the study was AY 1993 -94 TO 2002-03. The
study examined changes in respect of deductions and exemptions available under the
various heads of the income for the period under study and their impact.
2. Anil Kumar Jain and Parul Jain (2007)

Reviewed the tax treatment of savings under the Indian Income Tax Act. The study
revealed that a very serious lacuna in the tax incentive provision in India has been that
they have been introduced in an ad hoc manner and have been subject frequent changes.
Such ad hoc changed have created uncertainty in the minds of savers and investors. It was
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suggested that tax incentives should be well targeted and relief should be substantial to
induce savers and investors.
3. Ankita Gupta (2009)

Studied the trends and responsiveness of personal income tax in India after the tax
reforms initiated in the liberalization era. The study analysed the major trends in the
taxation of personal income in India during the period 1980-2008. It was revealed that tax
reforms have a favourable impact on the growth of personal income tax and the major
factors responsible for the increase in revenue responsiveness are reduction in top
marginal rate of personal income tax; reduction in the number of tax slabs; increasing
compliance through wider coverage of tax payers and high GDP growth rate. The study
concluded that simplification of tax rate and broadening of the tax base are the important
reforms that could be undertaken for reforming the tax structure and increasing its
responsiveness.
4. Ria Sinha (2010)

Observed that tax systems around the world have undergone significant reforms in the
last twenty years due to the varying ideologies and levels of development. In the study
‘An International Comparison of Tax Regimes’, she tries to evaluate the existing tax
structure in India in comparison to some of the developed as well as developing
countries. The study concluded that at present there may be no strong rationale for further
reduction in the existing tax rate.
5. Gandal Revji Vinayak
A Study on Awareness of Tax Planning Amongst Salaried Employees in Khopoli City of

Raigad District in Maharashtra, International journal of research in Commerce,
economics & Management.
6. Geetha R
E- Filing of Income Tax: Awareness and satisfaction level of individual tax payers in
Coimbatore city, Journal of Management Sciences.
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7. Govinda Rao.M (2005)
Tax System Reform in India: Achievements and Challenges Ahead”, Working Paper,
National Institute of Public Finance and Policy.
2.4 OBJECTIVES OF THE STUDY
The study was concerned with the following objectives:
1. To review the tax reforms being introduced by the government in respect of income tax
laws and ascertains its impact on salaried class.
2. To assess the efficiency of administrative machinery for collection of income tax and
management of taxation matters as per the income tax act.
3. To understand and evaluate tax planning measures being adopted by salaried class of
the state.
4. To assess whether there is significant differences in the tax planning measures adopted
by different segments of the salaried class of the state, based in level of income and type
of organization.
5. To ascertain the level of awareness of salaried class on various tax planning measure
available under the income tax act.
2.5 SCOPE OF THE STUDY
Taxation is considered as a complex matter affecting financial planning of each

individual income tax assesses The scope of the present study is limited to the tax
planning measures adopted by the salaried income tax assesses of the state. The study
also evaluates the extent of awareness of employees on tax laws and tax planning
measures. The savings habits, investment pattern, repayment of liabilities , tax planning
measures adopted for the period under study and level of awareness of employees on tax
laws and tax planning measures were studied and evaluated.
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2.6 LIMITATIONS OF THE STUDY
1. People generally were reluctant to disclose information relating to their savings,

investments and taxation measures.
2. The study is restricted to limited period.
3. In the secondary data, there were discrepancies in the data available from various
sources.
4. The current statistics relating to some of the aspects of direct tax administration is still
lacking.
5. Lack of previous experience in doing research was another difficulty.
2.7 OPERATIONAL DEFINITIONS OF THE CONCEPT
1. INCOME
This is a very important term as income tax is charged on the income of a person. This
term has not been defined in the Income Tax Act, except that it states as to what is
included in income. Under this section income includes Profit and Gains, Dividend,
voluntary contributions received by a trust created for charitable or religious purposes, or
by a scientific research association, or by a games or sports association or institutions, or
any university or other educational institutions, or any hospital or other institution, an
electoral trust. The value of any perquisite or profits in lieu of salary taxable under the
head ‘salaries’. Any special allowance or benefit specifically granted to the assesse to
meet his expenses wholly, necessarily and exclusively for the performance of his duties.
The value of any benefit tor perquisite which is obtained by any representative assesse.
2. ASSESSEE
An assesse means a person.
1) Who is liable to pay any tax.
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2) Who is liable to pay any other sum of money under this Act.
3) In respect of whom any proceeding under this Act has been taken for the assessment of
his income or assessment fringe benefits.
2.8 METHODOLOGY OF THE STUDY
1. Types of Research:-Descriptive Research
A statistical study to identify patterns or trends in a situation, but not the casual linkage
among its different elements. Descriptive studies help in generating hypothesis on which
further research may be based.
2. Sample Methodology: - Convenience Sampling
A convenience sample is a type of non-probability sampling method where the sample is

taken from a group of people easy to contact or to reach. For example, standing at a mall
or a grocery store and asking people to answer questions would be an example of a
convenience sample. This type of sampling is also known as grab sampling or availability
sampling. There are no other criteria to the sampling method except that people be
available and willing to participate. In addition, this type of sampling method does not
require that a simple random sample is generated, since the only criterion is whether the
participants agree to participate.
3. Sample Size: - The sample size of the data 50 respondents.
4. Types of Data collection: -
Primary Data collection:-Primary Data for the survey has been collected through survey
questionnaire prepared and administered to the respondents. It also includes personal
interaction with the company officials and 50 respondents of salaried classes.
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Secondary Data collection: - These are the data which have been collected and completed
for another purpose for further research. Secondary sources consists of compiled
statistical statement and report whose data may be used by researchers for their studies. It
comprises the use of internet, textbook etc.
5. Research Instrument: - The data has been collected with help of questionnaire. A
questionnaire is a set of questions that are given to people in order to collect facts.
6. Plan of Analysis:-
The data is analysed and interpreted with the help of mathematical methods. Simple
percentage method is used in analysing the data.
Simple percentage= No. of respondents/ Total no. of respondents x 50
2.9 CHAPTER OVERVIEW
Chapter 1:- Introduction
This chapter includes the theoretical background of the study described in details.
Chapter 2:- Research Design
It includes the title of the study, statement of the problem, objectives, scopes, limitations,
methodology of the study and chapter overview.
Chapter 3:- Company Profile
It includes the data of the company such as type, nature, organizational chart, board
members and other detailed information of the company.
Chapter 4:- Data analysis & interpretation
This chapter covers the analysis and interpretation tools which includes graphs and
tables.
Chapter 5:- Summary of findings and conclusions
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It consists of summarized outcomes and understanding of the study.
Chapter 6:- Suggestions
This chapter provides suggestions and solution for the company to improve.
Appendices & annexures:-
It consists of all the useful materials collected from the company.
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Chapter 3: COMPANY PROFILE:

3.1 OVERVIEW
Dhanush Associates is dedicated to help Businesses and people with their Accounting
Needs. Dhanush Associates services Firm offering accounts, direct tax, indirect taxes
consultancy and other related services. Since its inception, Dhanush Associates has
continuously focused on best practices and client satisfaction. Dhanush Associates
collaborates with each client to deliver adapted business process solutions that range in
complexity from individual transaction-based functions, such as accounts payable and
accounts receivable, to full-service finance and accounting, including general ledger
accounting.
1. Quality
We introduce ourselves as an Auditing and Consulting based in Bangalore with an aim of

providing Professional services to our clients. We provide Value Added complete
outsourced back office accounting, and tax support thus bringing down the accounting
costs substantially without compromising on quality and data security.
2. Mission
 Giving high quality services that exceed our client’s expectations.

 Building long-term relationships with our clients.
 To deliver the quality deliverables at any cost.
 Be truthful to the clients.
 Be passionate in solving the difficult problems of the clients.
 To provide innovative ideas to the clients.
 To keep utmost confidentiality.
 To make our partners the most relaxed one in area of compliances.
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3.2 INCECPTION
Dhanush Associates Auditor & Tax Consultancy gives best highly qualified professionals
in the field of auditing, accounting and financial consulting. Dhanush Associates was
established to innovate in the development of the financial and accounting system and
provide the best services in the field of finance and accounting for business owners,
corporations, government and non-governmental institutions. Based on our true belief in
the role and value of the accounting systems and our understanding of the urgent need for
our customers to provide them with specialists with high expertise in this area, it has been
necessary to provide financial and accounting services in all sectors that serve and
support the global and regional economies; where our office offers this service focusing
on the expertise of its members who are characterized with professional excellence and
high confidentiality of the customer’s data.
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Integrity
Responsibility &
Versatility
Accountability
Value
s
Simplicity Adaptability
Professionalism
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3.3 NATURE
 An auditor is a type of accountant. The main job of the auditor is verification of

an individuals or company's financial records. Auditors study various sources to
find out whether a company's records present its true financial situation. They
check the company's bookkeeping and accounting methods by analysing its books
and records. They compare the company's books with the records of the banks,
brokers, creditors, and others who deal with the company. They check the books
of the departments within the company as well. These objective analyses and
reports often help management cut costs, save on taxes, and increase profits.
There are two types of auditors—external and internal. External or independent
auditors work for public accounting firms or are self-employed. Businesses,
industries, and government agencies contract with auditors to verify and certify
their financial statements. Well-run companies usually have their books audited
once a year. An independent audit gives shareholders and creditors an outside,
expert opinion of a company's financial condition. The work of internal auditors is
similar to that of external auditors, but internal auditors work for and receive a
salary from one company. These auditors examine and evaluate the financial
system of their firm to ensure that it is being run efficiently and economically.
 We use an integrated approach to service our clients. This approach help us
initiate decisions and significantly minimizes the costs to our clients.
 With all the responsibility we follow ethical standards, including professionalism,
objectivity, independence and preserve strict confidentiality. Our long-term
relationship with clients is the best base for the reputation of our Firm.
 We are open for discussion of any format of collaboration convenient to our
client, within the framework of various forms and contents of consulting, auditing
and expert services contracts.
 We appreciate the trust of our clients and potential clients and look forward to
sincere, trustful and fruitful cooperation.
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3.4 ORGANIZATIONAL CHART
CEO
Mr. D Mayanna
Gowda
Business Liasion
Manager Executive Manager HR Manager
Advisors Services Accounting &

Audit Services Unit
Unit Bookkeeping Services
Counsultancy Audit Services Unit Accounting Manager

Manager Manager
Assistant Audit Supervisor Senior Auditor Accountants
Auditor(1) Audtor(2)
Junior Auditor(1) junior Auditor(2)
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Personnel Breakdown
JOB TITLE No of Staff

C.E.O 1
Managers 6
Service Unit 3
Assistant 1
Accountant 1
Senior Auditor 1
Audit Supervisor 1
Auditors 2
Junior Auditors 2
3.5 OUR SERVICES

Dhanush Associates Auditors & Tax Consultancy Office provide the best services for our
dear customers to benefit their business and get the best results. Our quality management
team focusing all the time on the customer satisfaction and how to use the latest
methodologies and tools to enhance our customers business and maintain the relationship
between their business and customers as well.
1. AUDIT & ASSURANCE
Our professional staff in the audit department gathers information during our auditing
process to understand fully the client’s business, internal controls and risk spectrum, then
they make the audit decisions, and our financial advisory experts deliver perfect
diagnostic tests. Our methods help our clients achieve their targeted demand for enhanced
accountability. We do our job closely with our clients, independently, and encourage
open communication.
Samples of Audit & Assurance services that we offer.
• Financial statement and other audit & assurance engagements.
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• Independent assessment of financial statements.
• Audit of prospective financial information.
• Financial reporting, auditing and accounting standards advice.
• Reports on internal controls.
• IT system reviews.
• Corporate governance reviews.
2. TAX SERVICES & CONSULTANCY
Since our watchword is creating value in an excellent manner, our tax management
services is top-notch. At Dhanush Associates, we are fully aware that due to
technological advancement, the business atmosphere globally is becoming increasingly
charged. As such, tax management and planning is now taking. However, with our
leading edge technology and our experience in outsourcing and consulting, we will help
you resolve your tax management issues. We have a track record in helping corporate
businesses address challenges on their tax operations in the different areas.
We offer the Different taxation services:
• Income Tax Returns & Financial Reports for All types of business and individual.
• 100% companies Taxation Reports.
• Business Activity Statements for all types of SME's businesses.
• Tax Planning & Tax Advice.
3. STATUTORY & TAX AUDIT
We conduct statutory and regulatory compliance audits for filing of annual or periodic
financial results. Statutory audits are aimed at achieving compliance with regulations,
assessing the strength of controls, confirmation of accounting treatments of recorded
transactions, independent review of reported in for motion and preparation of
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accountants' report. We annually serve our clients in area of tax audit under various
provisions of the tax laws. Our clients are large, medium corporations and small
businesses, partnership firms, non-profit organisations and high net worth individuals.
The firm has dedicated audit teams which specialise in conducting the audits effectively
and diligently.
4. ACCOUNTING & BOOKKEEPING
In an increasingly complex world today, having the best platforms that guarantee success you
should not only be desired but also extremely essential. For all successful businessmen, efficient
management of their accounting and bookkeeping records are in the right hands. We are such
expert hands you should trust with your accounting and bookkeeping. We ensure that our
clients get the best accounting and bookkeeping services. We do not just talk bookkeeping and
accounting, we do it. Also, we do not only do it, we make sure it is done in such a way that it
adds value to your organization. Through our different services in Accounting & Bookkeeping
Accounts payable, Accounts receivables, Daily General ledger maintenance, Payroll processing,
Balance sheet generation and review.
5. TAX STRATEGY & COMPLIANCE
Our specialist tax partners have a responsibility to ensure that the clients' tax bill is
optimised and they do not pay any unnecessary taxes. This involves a complete
understanding of the ever changing tax laws which offer innumerable tax optimisation
opportunities in the form of deductions, exemptions for losses and expenses. Our
knowledge plays a pivotal role in tax planning, advisory and compliance services. Our
regulatory compliance services ensure that the clients attain a high level of stringent tax
law compliances.
3.6 Particulars of Partners
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Sl. Name Qualification Whether Whether

No
DISA/ FCA of
CISA ACA
1. N.K Satish B.com, No FCA , ACS
FCA,
ACS
2. P. Srinivasanu B.com, F.C.A No FCA
3. S. Krishna B.com, F.C.A No FCA
4. Muniratnam B.com, F.C.A No FCA
3.7 FUTURE PROSPECTS
The past financial crisis that many economies all over the world experienced prompted a
renewed interest in the role and importance of auditing. The future of auditing will
therefore be closely tied to the continuous ripples of effects that the world is still
experiencing due to the financial crisis. However, it is to be expected that this industry
would continue to grow in prevalence in the business world.
Given all this, there is an expected increase in the job vacancies for various auditing jobs,
including:
 Internal audit. Internal audit is expected to grow at a faster rate, given the fact that
many companies nowadays choose to hire in-house auditors that would be able to
give them financial advice anytime it is needed.
 External audit. External audit continues to be dominated by the Big 4 firms,
although external audit jobs continue to grow both in these firms and in others
that are not as big as them. The opportunities continue to expand especially for
new graduates; working in external audit will still be considered as an important
part of an auditor’s career progression.
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 IT audit. This is one of the fastest-growing jobs in the market nowadays. The need
for IT audit has become highly important especially in businesses where
automated processes and systems are starting to play a larger role.
 Compliance jobs. Compliance is another major audit job that will see a growth in
the coming years. The compliance manager is responsible for ensuring that the
company and all its employees comply with the regulations that are in place, such
as those set by the Securities and Exchange Commission. This is considered as a
challenging job that comes with a lot of responsibility. A role in compliance
means you will be responsible for keeping a firm in good standing. It is a
promising, rewarding job for those who are sincerely interested in it.
3.8 SWOT ANALYSIS
A SWOT Analysis is a powerful tool to develop business strategies for start-up firms as
well as for existing companies. This simple framework is used to evaluate the positioning
of a firm in a competitive market. SWOT analysis of Dhanush Associates can lead the
company towards making effective and wise business strategies. SWOT stands for:-
 Strengths
 Weaknesses
 Opportunities
 Threats
Strengths
 The Office of the Director of Audit is established under the Grenada Constitution. The
Constitution also sets out his/her duties, access to records, independence: not being under
the control of any other person in the performance of his/her duties and the process for
his/her appointment, retirement and removal from office.
 The staff is qualified, experienced, committed and trained.
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 Clear organisational structure and reporting lines.
 An audit manual that promotes consistency and is compliant with INTOSAI standards.
 Well-structured in-house training programme
 Department well respected in the Public Service
Weaknesses
 Incompleteness of the Audit Act: lack of control over human and financial resources
and inadequacies in the reporting process.
 Insufficient staff to fully deliver our mandate.
 Lack of administrative control over our Information System.
 Lack of timely awareness of new auditing standards and techniques.
Opportunities
 Staff have access to training through CAROSAI and the Department of Public
Administration
 Current economic downturn forces the department to become more innovative and
discover more efficient ways to fulfil its mandate.
 A more informed public, demanding more accountability for public funds.
 Improve the effectiveness of PAC
 Ability to perform more high profile audits
 Capability to charge fees for services provided
Threats
 Restrictions on hiring in the Public Service because of scarce financial resources.
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 Changes in the political outlook, which may impact the operations of the Department.
 Leaking of draft reports to the media may damage our image.
 Potential increase in staff turnover.
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Chapter 4: DATA ANALYSIS AND

INTERPRETATION
The data so collected was analysed and interpreted in the following the charts:-
TABLE No. 1
TABLE SHOWING THE GENDER OF RESPONDENTS
RESPONDENTS FREQUENCY PERCENTAGE
Male 23 46%
Female 27 54%
Total 50 100%
Source: Primary Data
ANALYSIS: -
From the above bar graph we can get to know that in the 50 respondent’s majority were
Females covering a count of 27 and Males covering a count of 23. It indicates that around
46% of the people who analysed the test were Male and 54% were female.
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CHART No. 1
CHART SHOWING THE GENDER OF RESPONDENTS
Count of Gender
46%
54%
Female Male
Source Data: - Primary Data
INFERENCE: -
The inference which can be drawn from the above graph is that the majority of customers
that responded in the research process is of the gender classification FEMALE and the
remaining were of MALE.
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TABLE No. 2
TABLE SHOWING THE AGE GROUP OF RESPONDENTS
AGE FREQUENCY PERCENTAGE
Below 20 0 0%
20-30 10 20%
30-40 10 20%
40-50 10 20%
50-60 8 16%
60-70 10 20%
Above 70 2 4%
Total 50 100%
Source:-Primary Data
ANALYSIS:-
From the above bar graph we get to know that the 10 people to responded to the survey
are of age group 20-30, 10 who were of age group 30-40, then 10 who belonged to age
group 40-50, they are followed by 8 if them in age group 50-60 and 10 who belonged to
age group of 60-70 and 2 in age group of above 70.
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CHART No. 2
CHART SHOWING THE AGE GROUP OF RESPONDENTS
Count of Age Group

4%
20%
20%
20%
16%
20%
20-30 30-40 40-50 50-60 60-70 Above 70
INFERENCE:-
From the above table 20% of the respondents are in between the ages 20-30, 30-40, 40-
50 and 60-70. 16% of the respondents are between 50-60.4% of the respondents are
above 70.
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TABLE No. 3
Table Showing On the basis of Sector wise classification
SECTOR FREQUENCY PERCENTAGE
Private Sector 20 40%
Public Sector 30 60%
Total 50 100%
ANALYSIS:-
The above graph indicates that from the people who responded to the survey 20 of them
are from private sector and 30 are from public sector. So the total number of people
responded are 50.
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CHART No. 3
Chart Showing On the basis of Sector wise classification
SECTOR
40%
60%
public sector Private sector
INFERENCE:-
From the above graph it shows that 60% are public sector employers and 40% are private
sector.
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TABLE No. 4
Table Showing On the Basis of Income level
INCOME LEVEL FREQUENCY PERCENTAGE
Less than 3 Lakhs 16 32%
3 Lakhs-5 Lakhs 16 32%
More than 5 lakhs 18 36%
Total 50 100%
ANALYSIS:-
The above graph shows that among the total respondents 16 of them earn less than 3 lakh
and 16 of them earn in between 3 lakhs to 5 lakh and 18 of them earn more than 5 lakhs.
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CHART No.4
Chart Showing On the Basis of Income level
Sales
11%
25%
64%
1st Qtr 2nd Qtr 3rd Qtr
INFERENCE:-
The above graph shows that 32% people earn less than 3 lakh and 32% people earn from
3 lakhs to 5 lakhs and 36% people earn more than 5 lakhs.
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CHART No.5
Table Showing On the basis of Income tax exemption limit
INCOME EXCEEDS FREQUENCY PERCENTAGE
Yes 27 54%
No 23 46%
Total 50 100%
ANALYSIS:-
The above graph shows that among the people who responded around 27 people has
agreed to IT exemption limit and 23 has disagreed to IT exemption limit.
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CHART No.5
Chart Showing On the basis of Income tax exemption limit
On the basis of Income tax exemption limit
46%
54%
Yes No
INFERENCE:-
This figure shows that 54% of the respondents income exceeds income tax level and 46%
respondents income does not exceeds income tax exemption limit.
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TABLE No.6
Table Showing Employer’s awareness about different tax

concession/exemption/rebate availed of
AWARENESS FREQUENCY PERCENTAGE
Yes 39 78%
No 11 22%
Total 50 100%
ANALYSIS:
The above graph shows that among the people who responded 39 were aware of different
tax exemption and remaining 11 were unaware of it.
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CHART No.6
Chart Showing Employer’s awareness about different tax

concession/exemption/rebate availed of
Employer’s awareness about different tax

concession
22%
78%
No Yes
INFERENCE:-
This figure shows that 78% respondents are aware about the different tax concessions
availed of and 22% respondents are not aware about the different tax
concessions/rebate/exemptions availed of.
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TABLE No.7
Table Showing the Source of income tax information
SOURCE FREQUENCY PERCENTAGE
Newspaper 18 36%
Business Journals 5 10%
Internet 6 12%
Friends and Relatives 9 18%
Tax Consultants 12 24%
Chartered Accountants 0 0%
Total 50 100%
ANALYSIS:-
The above graphs indicates that the sources of IT information was found from that 18
respondents gets information about income tax from newspaper, 12 from tax consultants,
9 from friends and relatives, 6 from internet and 5 from business journals.
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CHART No.7
Charts Showing the Source of income tax information
The Source of income tax information
24%
36%
18%
10%
12%
NEWSPAPER BUSINESS JOURNALS INTERNET

FRIENDS AND RELATIVES TAX CONSULTANTS CHARTERED ACCOUNTANTS
INFERENCE:-
This figure shows that36% respondents gets information about income tax from
newspaper, 24% from tax consultants, 18%from friends and relatives, 12% from internet
and 10% from business journals.
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TABLE No.8
Table Showing the Savings of the employees
INCOME FREQUENCY PERCENTAGE
UP To 10% 25 50%
10-20% 14 28%
20-30% 8 16%
30-40% 1 2%
ABOVE 40% 2 4%
TOTAL 50 100%
ANALYSIS:-
This figure shows that among the total respondents, 25 respondents saves 10% of income
in schemes approved by CBDT, 14 respondents up to 10-20%, 8 respondents up to 20-
30%, 1 respondent up to 30-40% of their income and 1 respondent more than 40%.
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CHART No.8
Chart Showing the Savings of the employees
Savings
2% 4%
16%
50%
28%
UP To 10% 10-20% 20-30% 30-40% ABOVE 40%
INFERENCE:-
This figure shows that among the total respondents 50% saves 10% of income in schemes
approved by CBDT,28% up to 10-20%, 16% up to 20-30%,4% up to 30-40% of their
income and 2% up to 30-40% .
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TABLE No. 9
Table Showing the Methods of savings
SAVINGS FREQUENCY PERCENTAGE
Chit Funds 4 8%
Banks 23 46%
Insurance 18 36%
Non-Banking Financial 4 8%
Institution
Capital market 1 2%
Other Assets 0 0
Total 50 100%
ANALYSIS:
The above graph shows that 4 people save under chit funds, 23 people under banks, 18
people in insurance, 4 of them in non-banking institution and 1 in capital markets and
none in other assets.
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CHART No.9
Chart Showing the Methods of savings
Methods of savings
3% 8%
8%
36%
46%
CHIT FUNDS BANKS

INSURANCE NON-BANKING FINANCIAL INSTITUTION
CAPITAL MARKET OTHER ASSETS
INFERENCE:-
This figure shows that about46% under banks, 36% under insurance 8% of the
respondents saves their income under chit funds, 8% under non- banking financial
institution and 2%under capital market.
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TABLE No. 10
Table Showing Tax planning measures of CBDT
OPTIONS FREQUENCY PERCENTAGE
Provident Fund 11 22%
Life Insurance Policy 17 34%
Approved Mutual Fund 7 14%
Fixed Deposit 15 30%
Total 50 100%
ANALYSIS:-
After analysing the data we got to know that 11 people use Provident Fund, 17 people use
life insurance for getting tax exemption, 7 people use approved mutual fund, 15 people
use fixed deposit.
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CHART No. 10
Chart Showing Tax planning measures of CBDT
Tax Planning measures of CBDT
22%
30%
14%
34%
PROVIDENT FUND LIFE INSURANCE POLICY APPROVED MUTUAL FUND FIXED DEPOSIT
INFERENCE:-
The above data shows that 34% of the respondents use life insurance for getting tax
exemption, 30% by using fixed deposit, 22% by provident fund and 14% by approved
mutual fund.
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TABLE No. 11
Table Showing Services rendered by professional financial adviser
OPTIONS FREQUENCY PERCENTAGE
Always 1 2%
Often occasionally 6 12%
Rarely 26 52%
Never 17 34%
Total 50 100%
ANALYSIS:-
The above graph shows that around 26 people with Financial Advisors are rendered often
occasionally, 1 of them is Always and Rarely 26 people are financially advised and 17
are never advised financially.
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CHART No.11
Chart Showing Services rendered by professional financial adviser
Services rendered by professional financial

adviser
2%
12%
34%
52%
ALWAYS OFTEN OCCATIONALLY RARELY
INFERENCE:-
This figure shows that only 2% respondents seek the services rendered by financial
adviser, 12% seek services often occasionally, 52% seek services rarely and 34% never
seek the services rendered by financial advisers.
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TABLE No.12
Table Showing Time of formulating plan
TIME FREQUENCY PERCENTAGE
Beginning of the year 12 24%
End of the year 51 42%
At any time 12 24%
No planning at all 5 10%
Total 50 100%
ANALYSIS:-
From the above table most of people formulating the tax plan in the Beginning of the year
are 12, End of the year are 51 people, At any time with 12 respondents and 5 are those
who don’t plan at all.
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CHART No. 12
Chart Showing Time of formulating plan
Time of formulating plan
10%
24%
24%
42%
BEGINNING OF THE YEAR END OF THE YEAR AT ANY TIME NO PLANNING AT ALL
INFERENCE:-
This figure shows that 24% respondents formulate their tax plans at the beginning of the
year, 42% at the end of the year, 24% at any time and 10% of total respondents have no
planning at all.
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TABLE No. 13
Table Showing Income tax awareness from tax consultants
AWARENESS FREQUENCY PERCENTAGE
Always 3 6%
Often 5 10%
Occasionally 17 34%
Never 25 50%
Total 50 100%
ANALYSIS:-
This figure shows that about 50% of the respondents never seek awareness of a tax
consultant, 34% seeks occasionally, 10% seeks often and 6% of the respondents always
seeks awareness of tax consultant for filing returns.
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CHART No.13
Chart Showing Income tax awareness from tax consultants
Income tax awareness from tax consultants
6% 10%
34%
50%
OFTEN OCCASIONALLY NEVER ALWAYS
INFERENCE:
This figure shows that about 50% of the respondents never seek awareness of a tax
consultant, 34% seeks occasionally, 10% seeks often and 6% of the respondents always
seeks awareness of tax consultant for filing returns.
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TABLE NO.14
Table Showing Awareness about income tax slab
RESPONSE FREQUENCY PERCENTAGE
Yes 32 64%
No 18 36%
Total 50 100
ANALYSIS:-
As per Table, 60% respondents were aware about income tax slab rate belongs to them,
while 40% respondents were not aware about slab rates applicable to them.
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36
CHART No. 14
Chart Showing Awareness about income tax slab
Awareness about income tax slab
36%
64%
No Yes
INFERENCE:-
As per Table, 60% respondents were aware about income tax slab rate belongs to them,
while 40% respondents were not aware about slab rates applicable to them.
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TABLE No.15
Table Showing Awareness about deductions under section 80 c to 80 U
Yes 42 84%
No 8 16%
Total 50 100%
ANALYSIS:-
The above data shows that around 42 people of the total respondent know about tax
deductions under section 80c to 80u. While only 8 of them denied of knowing about the
awareness about deductions.
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CHART No. 15
Chart Showing Awareness about deductions under section 80 c to 80 U
Awareness about deductions under section

80 c to 80 U
16%
84%
No Yes
INFERENCE:-
As per Table, 80% of the tax payers are aware about the deductions under section 80C to
80 U & 20 % of the tax payers are not aware.
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TABLE No. 16
Table Showing Reasons why tax payers pay taxes
VARIABLES FREQUENCY PERCENTAGE
To Avoid Punishment 12 24%
To get public facilities 20 40%
It’s an obligation 15 30%
I don’t know the reason 3 6%
Total 50 100%
ANALYSIS:-
As per Table, respondents were asked why they pay taxes, 20 of the respondents said that
they pay taxes in expectation of public facilities from the government and 15 of tax
payers responded that because it is a duty to the government,12 of tax payers replied that
they pay tax to avoid punishment, and 3 of respondents were responded that they don’t
know why they pay tax to the government.
80
ASSOCIATES
CHART NO.16
Chart Showing Reasons why tax payers pay taxes
Chart Title
6%
24% 30%
40%
its an obligation To get public facilities To avoid punishment I don’t know
INFERENCE:-
As per Table, respondents were asked why they pay taxes, 33.33% of the respondents
said that they pay taxes in expectation of public facilities from the government and
41.67% of tax payers responded that because it is a duty to the government, 20% of tax
payers replied that they pay tax to avoid punishment, and 5% of respondents were
responded that they don’t know why they pay tax to the government.
81
ASSOCIATES
TABLE NO.17
Table Showing Reasons why tax payers are not willing to pay tax
POSSIBLE ANSWERS FREQUENCY PERCENTAGE
Because of lack of 21 42%

awareness
Because of lack of ability 7 14%

to pay
Intentional 9 18%
Negligence 10 20%
Poor & Tiresome 3 6%

collection System
Total 50 100%
ANALYSIS:-
As per Table, tax payers were asked to express their view about the reasons why tax
payers are not willing to pay tax voluntarily. Consequently, 21 of tax payers were replied
that most tax payers do not pay taxes because of lack of awareness about taxation, 3 of
tax payers were responded because of existence of poor and tiresome tax collection
system, 10 of tax payers were answered because of negligence of tax payers, 9 of tax
payers were replied that because of intentional noncompliance of tax payers and 7 of tax
payers responded that because of lack of capacity to pay by tax payers. Therefore, from
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the this finding, we can conclude that the main reason for tax non-compliance by most
tax payers is lack of awareness about taxation followed by existence of poor and tiresome
collection system, negligence, intentional and lack of ability to pay respectively.
83
ASSOCIATES
CHART No. 17
Chart Showing Reasons why tax payers are not willing to pay tax
why tax payers are not willing to pay tax
0.06
20%
42%
18%
14%
Because of lack of awareness Because of lack of ability to pay

Intentional Negligence
Poor & Tiresome collection System
INFERENCE:-
About the reasons why tax payers are not willing to pay tax voluntarily. Consequently,
35% of tax payers were replied that most tax payers do not pay taxes because of lack of
awareness about taxation, 21.67 % of tax payers were responded because of existence of
poor and tiresome tax collection system, 16.66% of tax payers were answered because of
negligence of tax payers, 15 % of tax payers were replied that because of intentional non-
compliance of tax payers and 11.67 % of tax payers responded that because of lack of
84
ASSOCIATES
capacity to pay by tax payers. Therefore, from the this finding, we can conclude that the
main reason for tax non-compliance by most tax payers is lack of awareness about
taxation followed by existence of poor and tiresome collection system, negligence,
intentional and lack of ability to pay respectively.
85
ASSOCIATES
TABLE No. 18
Table Showing Awareness of tax returns filling due date
DUE DATE FREQUENCY PERCENTAGE

AWARENESS
I am aware 20 40%
I am not aware 30 60%
Total 50 100%
Source: Primary data
ANALYSIS:
From the above table it is evidenced that 20 of the respondents were aware of the due
dates of filing tax returns, while 30 of the respondents were not aware of the due date.
86
ASSOCIATES
CHART No. 18
Chart Showing Awareness of tax returns filling due date
40%
60%
I am not aware I am aware
INFERENCE:-
From the above table it is evidenced that 40% of the respondents were aware of the due
dates of filing tax returns, while 60% of the respondents were not aware of the due date.
87
ASSOCIATES
TABLE NO.19
Table Showing Under which heads of income your income becomes

taxable
HEADS OF INCOME FREQUENCY PERCENTAGE
Income from salary 20 40%
Income from house 9 18%

property
income from business 14 28%

and profession
Income from capital gain 5 10%
Income from other 2 4%

sources
Total 50 100%
ANALYSIS:
From the above table it is evidenced that 14 of the respondent’s income were taxable
under head income from business and profession, while 20 of the respondent’s income
were taxable under head Income from salary, 9 of the respondent’s income were taxable
88
ASSOCIATES
under head Income from house property,5 of the respondent’s income were taxable
under head income from capital gain & 2 of the respondent’s income were taxable under
head Income from other sources.
89
ASSOCIATES
CHART No. 19
Chart Showing Under which heads of income your income becomes

taxable
Under which heads of income your income

becomes taxable
4%
10%
40%
28%
18%
Income from salary Income from house property

income from business and profession income from capital gain
Income from other sources
INFERENCE:-
From the above table it is evidenced that 40% of the respondent’s income were taxable
under head income from business and profession, while 33.33% of the respondent’s
income were taxable under head Income from salary,15 % of the respondent’s income
were taxable under head Income from house property,8.33% of the respondent’s income
90
ASSOCIATES
were taxable under head income from capital gain & 3.34% of the respondent’s income
were taxable under head Income from other sources.
91
ASSOCIATES
TABLE No. 20
Table Showing Awareness of basic concepts (assessment year, previous

year, income tax, assesse, tax liability etc.)
Yes 35 70%
No 15 30%
Total 50 100%
ANALYSIS:-
As per Table, Out of 50respondents 35 respondents were aware about basic income tax
exemption limit and 15 respondents were not aware about basic exemption limit.
92
ASSOCIATES
CHART NO.20
Chart Showing Awareness of basic concepts (assessment year, previous

year, income tax, assesse, tax liability etc.)
basic concepts
30%
70%
No Yes
INFERENCE:-
As per Table, Out of 50 respondents 70% respondents were aware about basic income tax
exemption limit and 30 % respondents were not aware about basic exemption limit.
93
ASSOCIATES
Chapter 5: SUMMARY OF FINDINGS AND

CONCLUSION
1. From the study it is found that 46% of the respondents are male, 54% are female.
2. When the respondents are classified on the basis of sector, 40% lies under private
sector and 60% are public sector.
3. From the data it was clear that majority of respondents have income level more
than R CONCLUSION s. 5 lakhs.
4. From the study it is found that the source of income other than salary of the
respondent was from agriculture income and interest.
5. About 54%of the respondents states that their income exceeds income tax
exemption limit.
6. Around 50% of the respondents pay tax from their annual income.  From the
total respondents, a majority of 78% are aware of the different ways in which tax
concession/ tax exemption/ tax rebate.
7. As per the study result the sources of getting information about income tax are
from newspapers and tax consultants.
8. As per the study result 50% of the respondents save only less than 10% of their
income by investing in schemes approved by CBDT.
9. From the study it is found that most of two respondents have saved their incomes
in banks and insurance.
10. Majority of the respondents use life insurance policy and fixed deposit as tax
planning measures suggested by the CBDT for getting tax exemption.
11. According to the survey majority of the respondent rarely seek the services of a
professional financial advisor for making investment decision.
12. From the study it is found that most of the respondents formulate their tax plans at
the end of the year.
13. From the study result it is clear that majority of the respondents never seek the
awareness of a tax consultant for filing returns.
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ASSOCIATES
14. Around 56% of the total respondents reveal that the services of the practitioner
are not necessary for filing the returns.
15. From the total respondents majority of them reveals that the tax consultants notify
them in the time of the latest income tax regarding filing returns and the
provisions for rebate concessions etc.
16. Around 60% of respondents are satisfied about the fees charged by the tax
consultants.
17. Most of the respondents reveal that they never faced any of the penalties
regarding the income tax
18. Majority of the respondents says that the tax rates in India are high.
19. As per the study around 54% of the total respondents say that the tax planning
education should be provided by the government to minimize the difficulties in
filing the tax returns.
CONCLUSION
From the above analysis it is concluded that overall tax literacy level is good. It can be
said that most of the tax payers have basic knowledge about income tax provisions,
concepts etc. Tax planning is done with the help of tax consultant as well as friends and
relatives & also tax payers get knowledge about tax through media also. TRA should
champion its literacy campaigns to improve the taxpayer’s ability to understand tax laws
i.e. rates of tax, filing and paying dates among others. TRA should also make taxpayers
feel part of the tax system and understand that they are not paying unfair share of taxes.
They should work to improve peer attitude i.e. a belief that neighbours are reporting and
paying tax honestly, and rewarding taxpayers for compliance by giving trophies for
outstanding tax payment.
95
ASSOCIATES
Chapter 6: SUGGESTIONS
TAXATION essentially depends on provisions in the Finance Act and the Budget.
Educating the masses of the provisions of the same and creating awareness on availing
the benefits is recommended.
1. Tax planning of the part-time employee assesses, retired employee assesses,

professional assesses and business assesses.
2. Comparative study between Taxes of salaried assesses and other assesses.
3. Taxation of Individual assesses in respect of tax on Fringe Benefits, Bank Cash

Transaction and Securities Transaction.
4. Opinion of the Tax Consultants, Industrialists and Trade Unions in respect of Tax
Planning Options offered for various categories of assesses by the Government of India.
96
ASSOCIATES
APPENDIX & ANNEXURES

1. What is the qualification of respondents?
a) SSC
b) Graduate
c) Postgraduate
d) Highly Educated
2. What is your gender?
a) Male
b) Female
3. Are you paying income tax?
a) Yes
b) No
4. An Individual cannot save money in spite of a increase in earnings because the

exempted income limit has not kept pace with the inflation. Do you agree?
a) Yes
b) No
5. When we compare the two major categories, i.e. Salaried and businessmen, it is found
that salaried people are paying more Income Tax than businessmen. Do you agree?
a) Yes
b) No
6. Do you agree that salaried assesses are not getting enough deductions?
a) Yes
b) No
97
ASSOCIATES
7. Do you think steps are required to be taken for reducing the tax liability to avoid Tax
evasion?
a) Yes
b) No
8. Do you invest so as to save the Income Tax?
a) Yes
b) No
9. How do you file the IT return?
a) Self
b) With the help of CA
c) Tax Consultant
d) None
10. Are you interested in the formalities and procedure of filing IT returns?
a) Yes
b) No
11. Have you paid IT penalty for any reasons, e.g., late submission of return or
inadequate information, etc.?
a) Yes
b) No
12. The Income Tax payers be provided Social Security from the Government
a) Unemployment
b) Handicapped
c) Accidental Death
d) Loss in Business Venture
98
ASSOCIATES
13. Have you taken any deduction u/c 80 and claimed?
a) Yes
b) No
14. The medically unfit, senior citizens, pensioners, handicapped should have a
separate system of filing the IT return which should be easy to operate and if possible
this service should be given at his place of residence.
a) Yes
b) No
15. All pensioners above 58 years of age should get rebate under section 88B.
a) Yes
b) No
16. Do you feel computation of Income Tax on gratuity and pension is difficult?
a) Yes
b) No
17. What reforms do you propose for simplification/improvement of the income Tax
Procedure & system?
a) Minimise the sections

b) Not to make so many changes every year
c) Income tax should be charged directly according to the level of income
d) Any other suggestions
99
ASSOCIATES
18. Do you think that system for answering the questions of the assesses at local level
should be improved?
a) Yes
b) No
19. Do you think that lack of co-ordination & co-operation between the Department &
the Public is the reason for misunderstanding & fear?
a) Yes
b) No
20. Do you agree with my proposal of filing the returns and settling the grievances
online?
a) Yes
b) No
21. The employees working in private firms or companies are not getting the same
deductions as compared to employees working in Central & State Government.
a) Yes
b) No
100

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A STUDY ON INDIVIDUAL SALARIED EMPLOYEE TAXATION WITH REFRENCE TO DHANUSH

 About the Industry

1. Customized EHS and sustainability audit program scaled to review client’s

To examine trends in auditor concentration, we estimate a regression with the three-firm

Tax consulting is an important area

obtaining loans, selecting

obtaining loans, selecting

obtaining loans, selecting

1.1.3 INDUSTRY PROFILE

1.1.4 Company Growth & Aspects

2. Review of the Internal Controls

1.1.5 Government Initiatives / Guidelines

4. Quality Assurance Review

5. Other General Standards for Audit Institutions

In other words all arrangements by

should not be done with an intent

correct in form and substance.

manner that the tax planner may

All transactions entered into by

The form and substance of a

of tax wholly or reduce it to

legally correct, yet on the whole

tax-planning device. The form of

may be permissible with in the

1.2.2 Types of taxes are:

1.2.3 Tax System in India

1.2.4 Importance of Income Tax:

Importance of Direct Taxes

Importance of Indirect Taxes

1.2.5 Income Tax Act, 1961 :

Under Section 2 (31) of Income Tax Act 1961, a Person includes:

 Individual (Sole Proprietorship)

1.2.6 Tax Slabs (with example )

New Regime Income Tax Slab Rates for

Rs 0.0 - Rs 2.5 Lakhs NIL

Rs 2.5 lakhs- Rs 3.00 Lakhs

5% (tax rebate u/s 87a is available)

Rs. 3.00 lakhs - Rs 5.00 Lakhs

Rs. 5.00 lakhs- Rs 7.5 Lakhs 10%

Rs 7.5 lakhs - Rs 10.00 Lakhs 15%

Rs 10.00 lakhs - Rs. 12.50 Lakhs 20%

Rs. 12.5 lakhs- Rs. 15.00 Lakhs 25%

> Rs. 15 Lakhs 30%

Chapter 2: RESEARCH DESIGN

• Title of the study.

• Statement of the problem. (Reason for selecting the topic)

• Objectives of the study.

• Scope of the study.

• Limitations of the study.

• Operational Definition of Concepts.

• Methodology of the study

i. Type of Research (descriptive/ analytical/exploratory etc.)

ii. Reference Period (in case of financial analysis)

iii. Sampling Method adapted.

iv. Sample Size (100)

v. Type of Data Collection.

vi. Research Instruments. (Questionnaire)