Profession means exploitation of one’s skills and knowledge independently. Profession includes vocation as well. Few examples are legal, medical, engineering, architecture, accountancy, technical consultancy, interior decoration, artists, writers etc.
The following books and documents are to be maintained by any professional:-
Cash book
Journal in case of mercantile system of accounting
Ledger
Carbon copies or counter foils of all bills issued, being serially numbered
Original copies of all expenditure bills. Signed vouchers where bills not available for less than Rs.50.
Any business or profession that has an annual turnover or gross receipts exceeding rupees ten lakh and net profit of rupees one lakh twenty thousand must maintain such books of accounts and documents from which its income can be determined by the IT department.
All the books of account and related documents must be kept at the main place of business where the business or profession is generally carried on. These documents must be preserved for a minimum of six years.
It must be mentioned here that the Income tax Act allows one to claim depreciation on movable tangible and intangible assets. The rates of depreciation are different for different assets.
