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Can accounts of apartment Association maintained like business account
21-Sep-2023 (In Tax Law)
Can Apartment society can Prepare accounts as normal Business accounts Income and expenses account. showing income side all maintenance receipts and interst income from FD? and expenses Side all the expenses like hous keeping , security etc. and diff show as profit/ loss and pay tax or carry forward loss. and accordingly pay income tax on the same. kindly advise
Yes, accounts of an Apartment Society can be maintained in the same way as those of any business entity. There is in fact little practical difference between a "Statement of Income and Expenditure" or a "Statement of Receipts and Payments" used in the context of a Society and a "Profit and Loss Account" of a business concern, except for the terminology. The former two statements usually denote the "not for profit" nature of activities of an entity, whereas the latter represents the contrary. Also, while all receipts of a Society are to be entered on the credit side of the statement, all expenses are to be recorded in its debit side. Excess, if any, of receipts over expenses is recorded as a "surplus" on the debit side and excess, if any, of expenses over receipts is recorded as a "loss" on the credit side. Both these balances are carried to the Society's capital account and reflected on the Liabilities side of the "Balance Sheet" or "Position Statement" of the Society.
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