All You Need to know about ICDS By Athulya - February 12, 2019 Last Updated at: Dec 03, 2020 3502 All You Need to know about ICDS Economic experts believe that the COVID-19 stimulus package by Govt. should include deduction of COVID related impairment losses of SMES. At this moment, there are no clear provisions either in the Income Computation and Disclosure Standards (ICDS) or in the IT Act on whether a provision for bad and doubtful debts can be claimed as a tax expense. ICDS or Income Computation and Disclosure Standards are given by the Government of India by granting powers in section 145 of income tax act in 1961.The main purpose of ICDS is to decrease the irregularities which were widespread in accounting computations and authority. The ICDS is applicable for everyone with any income sources. Income Computation and Disclosure Standards which is abbreviated as ICDS were given out by Government of India through the powers conferred to it by section 145 of the income tax act, 1961. ICDS is for the purpose of computation of income under the “Profits and Gains of Business or Profession” or “Income from Other Sources”. The aim of the ICDS is to reduce the irregularities that were prevalent in accounting computations and governance. Check out some of the articles below to find step by step information on company registration, iso registration or income tax related services and avail our resources to help you through the process.We are one of the best online service providers in the market for tax registrations and legal documentation. Register a Company PF Registration MSME Registration Income Tax Return FSSAI registration Trademark Registration ESI Registration ISO certification Patent Filing in india ICDS is applicable to all persons unless certain specific statutes, which are in major focus towards a particular sector (for example, VIIIth ICDS has provisions specifically for certain banking and financial institutions.) Get Your Taxes Prepared by Experts ICDS is applicable to any income or benefit under the profits/gains which the individual sources through business or profession or income from other sources. The compliance of the standards is a better and easy way to efficiently compute the income tax. The income tax act allows the assessing officer to assess in accordance with ICDS but in the case of non-compliance then it would be coming through section 144 of the Income Tax Act. The Income Tax act on any aspect prevails over the ICDS. But in case of contradiction between judgement and ICDS, then ICDS prevails over it. The ICDS was drafted by the ministry of Finance wherein 14 drafts were prepared out of which only 10 were notified by the government. Now we shall see the list of ICDS: ICDS I – Accounting Policies ICDS II – Valuation of Inventories ICDS III – Construction Contracts ICDS IV – Revenue Recognition ICDS V – Tangible Fixed Assets ICDS VI – The Effects of Changes in Foreign Exchange Rates ICDS VII – Government Grants ICDS VIII – Securities ICDS IX – Borrowing Costs ICDS X – Provisions, Contingent Liabilities and Contingent Assets ICDS does not give a detailed explanation of its statutes and examples like Accounting Standard. The ICDS was developed using Generally Accepted Accounting Principles (GAAPs) with assistance from the Institute of Chartered Accountants of India. It is in place to make the procedure and liability management in India over the taxation regime simple. The ICDS cannot be used over the books of accounts but for notifying over profits and losses. The ICDS bring a set of notification and out of the 14 notification given out by the government, right now only 10 were officially recognized. The ICDS was expanded with the help of Generally Accepted Accounting Principles(GAAPs) with the support of Institute of Chartered Accountant of India. The ICDS will not provide a detailed explanation of statutes. The ICDS bring a set of notifications, out of which 14 notifications are given by government and right now only 10 are officially recognized.