Tag Archives: Audit Report for Housing society

Income Tax on Housing Society

Income Tax On Housing Society

Income Tax On Housing Society

The general perception of the Managing Committee of a cooperative housing society is that the income generated by the society is not chargeable to tax and therefore do not bother to file Annual Tax Return. This is a wrong perception since though certain types of income of cooperative housing society are fully exempted there are other incomes which are chargeable to tax.

The society’s income is generated by the following charges:
(1) Contribution from Members:
This is the most common charges the society collects from its members to run the day to day affairs of the society. They are credited under different heads namely, maintenance, municipal taxes, electricity, lift maintenance, housekeeping, water charges, repair funds, sinking fund. etc. Any surplus generated due to these types of income is not chargeable to tax as its exempted based on the “Concept of Mutuality”

(2) Interest charged on member outstanding dues:
Interest charged by the society on outstanding dues again forms a part of contribution and qualifies the test of concept of mutuality and is exempted.
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New Format of Audit Report for financial year 2015-2016

      The Chairman /Secretary
Sub : Submission of Statutory Audit Report for the accounting year ended 31st March, 2016.
The accounts of ______ Co-op Housing Society Ltd. have been audited on the basis of record produced and information supplied (oral and written) by the office bearers of the society during course of our audit.  The statement of accounts viz..Income & expenditure A/c. & the Balance sheet, for the aforesaid period have been duly examined and the observation and discrepancies so noticed on the transaction and affairs of the society have been mentioned in audit objection and general remarks.
Please find enclosed herewith the Statutory Audit Report for the accounting year 1stApril, 2015 to 31st March, 2016 along with the following –
1.            Statement of Income and expenditure Account & the Balance Sheet
2.            Auditors certificates, brief introduction & comment on the present status of the society, Auditors Report with audit objections, observations & general remarks & other mandatory details of the society viz table 1, 2 & 3.
3.            Schedule of Infringement of M.C.S. ACT 1960, RULES 1961 as per new amendments in the model bye_laws of the society.
4.            Audit memorandum viz. form no. 1 & form no 28.
Society is instructed to submit audit rectification report in “O” form within three months from the date of obtaining audit report to the office of registrar of co-operative societies without fail.
Thanking you,
                                                                                     AS PER OUR REPORT OF EVEN DATE

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