Small Taxpayers Do Not Record Properly

Taxable Profit that Small Taxpayers Do Not Record Properly

There are three simple books required for simplified accounting record of small taxpayers:

• -Sales day book
• -Purchases day book
• -Inventory book.

If the small taxpayers do not maintain or record properly of the simplified accounting requirement, the turnover and taxable profit will be reassessed by tax administration as the following methods:

1. The estimated turnovers per month or year are estimated and observed by tax officer to find average of turnovers from supplying goods or services.
2. Taxable profit is estimated as follows.
   -20% of estimated turnover will be considered as taxable profit for merchandising business
   -40% of estimated turnover will be considered as taxable profit for servicing business
   – 50% of estimated turnover will be considered as taxable profit for supplying of gold, diamond and other precious stone and currency exchange service. Turnover is variance of selling and purchasing them.