Direct tax work covers how income is computed, how returns are prepared and filed, how tax is withheld and paid during the year, and how the department's questions are answered afterwards.
This describes the subject in general terms and is not advice; what applies depends on the facts, and the law changes.
Understanding the service
Income-tax is charged on the income of persons, including individuals, Hindu undivided families, firms, LLPs and companies. Income is computed under heads: salaries, income from house property, profits and gains of business or profession, capital gains, and income from other sources.
For individuals, the work commonly involves salary and investment income, capital gains, stock options, property and, where applicable, foreign assets and non-resident status. Where the law offers a choice of regime, the tax under each is computed and compared.
For businesses, it extends to the treatment of expenditure, depreciation, disallowances, tax deducted and collected at source, and advance tax during the year.
The Income-tax Act, 2025 applies from 1 April 2026 and replaced the 1961 Act. Provisions and forms are renumbered, so the Act applicable to the period concerned governs.
When it becomes relevant
- Preparing and filing a return of income
- Choosing between regimes where the law gives a choice
- Capital gains on shares, mutual funds or property
- Salary with stock options, or income from more than one country
- Deducting and depositing tax at source, and filing the returns
- An intimation, notice or assessment order
What the work usually covers
- Computation of income and tax, and preparation of the return
- Advance tax computation during the year
- Tax deducted and collected at source: deduction, deposit, returns and certificates
- Capital gains computation and reporting
- Review of notices and preparation of responses
- Planning within the law, before transactions are entered into
Framework and sources
The law and professional standards this work is carried out under. Links open the official site.
How the work runs
- CollectGather income details, statements and supporting documents.
- ComputeWork out income and tax under the applicable heads and regime.
- ReviewReconcile against the department's records, including the annual information statement.
- FileSubmit the return electronically and complete verification.
- Follow upTrack intimations, refunds and any notices.
A general sequence. Engagements differ, and the scope of each is agreed in writing.
Common questions
Which regime should I choose?
It depends on income, deductions and exemptions. Both are computed and compared for the year concerned.
Do I have to report foreign assets?
Residents may be required to disclose foreign assets and income. What applies depends on residential status and the facts.
What should I do when a notice arrives?
Note the provision cited, the period and the date for response. Responses are generally filed through the portal, so delay narrows the options.