100 terms · linked to source guides

Accounting, GST, Income Tax & TDS Glossary — India

Plain-English definitions of the terms that appear across Indian books, returns and audits — each linked to the section of our pillar guides where you can read more.

Reviewed May 2026
CA Anil Agarwal & the TatvaBooks team

A 10 terms

AATO: Aggregate Annual Turnover — PAN-India turnover used for GST thresholds (e-Invoice ₹5 crore, 30-day IRN reporting ₹10 crore, HSN-digit requirement). → See GST Guide §11 HSN & SAC
Accounts Payable: Money your business owes suppliers for goods or services received but not yet paid. A current liability on the balance sheet.
Accounts Receivable: Money customers owe your business for goods or services delivered but not yet collected. A current asset on the balance sheet.
Accrual Basis: Accounting method where revenue is recognised when earned and expenses when incurred, regardless of when cash changes hands. Required for companies under the Companies Act.
Accruals: Expenses incurred in a period but not yet invoiced or paid — booked via journal entry to match cost with the period it relates to.
AIS: Annual Information Statement — comprehensive income-side statement on the income-tax portal showing TDS, TCS, interest, dividend, securities, mutual fund, foreign remittance and high-value transactions reported by third parties. → See Income Tax Guide
Amortisation: Systematic write-off of an intangible asset (software, goodwill, patents) over its useful life. The intangible-asset analogue of depreciation.
AMT: Alternate Minimum Tax — 18.5% (plus surcharge and cess) on adjusted total income of non-corporate assessees claiming specified deductions. Mirror of MAT for the non-corporate side.
ARN: Application Reference Number — issued by the GST portal for any application, return acknowledgement or refund filing. Track requests with this number.
Assessment Year (AY): The 12-month period (1 April to 31 March) following the financial year, in which income of that financial year is assessed to tax. FY 2025-26 corresponds to AY 2026-27. → See Income Tax Guide

B 3 terms

Balance Sheet: Statement of financial position at a point in time — Assets = Liabilities + Equity. One of the three core financial statements alongside P&L and cash flow.
Belated Return: An income-tax return filed after the original due date but on or before 31 December of the AY, under Section 139(4). Late-filing fee under Section 234F applies. → See Income Tax Guide
BRC: Bank Realisation Certificate — proof from the AD bank that export proceeds have been received in India. Required to close LUT-route GST refund applications. → See GST Guide §14 Refunds

C 6 terms

Cash Basis: Accounting method where revenue is recognised when cash is received and expenses when cash is paid. Permitted for professionals under Section 44ADA and small businesses under Section 44AD.
Cash Flow Statement: Statement showing cash inflows and outflows split into operating, investing and financing activities — explains how the cash balance moved during the period.
Cess: An additional levy on top of a base tax. Health & Education Cess at 4% applies on income tax. GST Compensation Cess — once charged over and above the 28% slab — now survives only on tobacco and pan masala after GST 2.0 abolished the 28% slab from 22 September 2025; it continues there pending closure of the compensation-cess loan repayment.
Composition Scheme: Simplified GST scheme for taxpayers up to ₹1.5 crore turnover — flat-rate tax (1% / 5% / 6%), no ITC, no inter-state supply, quarterly CMP-08 and annual GSTR-4. → See GST Guide §4 Composition
Contra Entry: Journal entry between two cash/bank accounts of the same business (e.g., cash deposited to bank). Has no profit-and-loss impact.
Credit: Right-hand side of a double-entry posting. Increases liability, equity and income accounts; decreases asset and expense accounts.

D 5 terms

Debit: Left-hand side of a double-entry posting. Increases asset and expense accounts; decreases liability, equity and income accounts.
Depreciation: Systematic allocation of the cost of a tangible fixed asset (machinery, vehicles, computers) over its useful life. Computed by SLM or WDV in books; by block-of-assets WDV under the Income Tax Act.
Double Entry: Bookkeeping system where every transaction is recorded as equal debits and credits across two or more accounts. The mathematical guarantee behind the trial balance.
DRC: Demand and Recovery — series of GST forms used for demand notices and responses. DRC-01 (SCN), DRC-01A (pre-SCN intimation), DRC-01B/C (auto mismatch), DRC-03 (voluntary payment), DRC-03A (link payment to demand). → See GST Guide §16 Notices
DTAA: Double Taxation Avoidance Agreement — bilateral treaty that prevents the same income from being taxed in two countries. Lower TDS rates often apply when a valid TRC is furnished. → See TDS Guide

E 1 term

e-Way Bill: Electronic permit required for movement of goods worth over ₹50,000. Validity: one day per 200 km. Auto-generated from IRN if you are on e-Invoice. → See GST Guide §7 e-Invoice & e-Way

F 9 terms

Financial Year (FY) / Previous Year (PY): The 12-month period from 1 April to 31 March in which income is earned. Under the Income Tax Act this is called the Previous Year; income of FY/PY 2025-26 is taxed in AY 2026-27. → See Income Tax Guide
Form 10-IEA: Form filed to opt out of the new tax regime (Section 115BAC) and continue under the old regime. Mandatory for taxpayers with business or professional income who wish to retain the old regime. → See Income Tax Guide
Form 12BAA: Notified in 2024 — employee declaration of other TDS/TCS already deducted (e.g., on FD interest, car purchase, foreign remittance) so the employer factors it into salary TDS, reducing over-withholding. → See TDS Guide
Form 12BB: Employee investment and rent declaration submitted to the employer for computing salary TDS — covers HRA, LTA, home-loan interest, and Chapter VI-A deductions. → See TDS Guide
Form 16: Annual TDS certificate issued by an employer for salary TDS deducted under Section 192. Two parts: Part A (TRACES-generated tax detail) + Part B (salary break-up). → See TDS Guide
Form 16A: Quarterly TDS certificate for non-salary payments (interest, rent, professional fees, contract payments). Generated from TRACES against 26Q / 27Q filings. → See TDS Guide
Form 16B: TDS certificate issued by the buyer of immovable property to the seller for TDS deducted under Section 194-IA at 1% on consideration ≥ ₹50 lakh. Filed via Form 26QB. → See TDS Guide
Form 26AS: Consolidated tax statement on the income-tax portal — shows TDS/TCS credits, advance tax, self-assessment tax and certain high-value transactions linked to your PAN. → See Income Tax Guide
Form 26QB: Challan-cum-statement for TDS under Section 194-IA on purchase of immovable property — filed by the buyer within 30 days of the end of the month of deduction. → See TDS Guide

G 11 terms

GST: Goods and Services Tax — India's destination-based indirect tax on the supply of goods and services, levied as CGST + SGST within a state and IGST across states. After GST 2.0 (22 September 2025) the main slabs are 5%, 18% and a 40% rate for sin and luxury goods. → See GST Guide
GSTAT: GST Appellate Tribunal — the second-level appellate body under GST. Benches notified across states. Appeals filed in Form APL-05 within 3 months with a further 10% pre-deposit. → See GST Guide §17 Appeals
GSTIN: 15-character GST identification number — State code (2) + PAN (10) + entity number (1) + 'Z' default (1) + check digit (1). One GSTIN per state per PAN. → See GST Guide §3 Registration
GSTR-1: Monthly (or quarterly under QRMP) return of outward supplies — every B2B / B2C / export / credit / debit note invoice. Due 11th of next month (monthly) or 13th after quarter (QRMP). → See GST Guide §5 Returns
GSTR-1A: Optional amendment return introduced from FY 2024-25 — filed between GSTR-1 and 3B of the same period so corrections flow into 3B liability immediately. → See GST Guide §5 Returns
GSTR-2A: Dynamic ITC statement — keeps updating as suppliers file or amend their GSTR-1. Useful for reconciliation; not the basis for the 3B ITC claim. → See GST Guide §6 ITC
GSTR-2B: Static, period-locked ITC statement generated on the 14th of every month, capturing invoices filed up to the 11th. The basis for claiming ITC in GSTR-3B. → See GST Guide §6 ITC
GSTR-3B: Monthly (or quarterly under QRMP) summary return where tax is actually paid. Due 20th of next month (monthly) or 22nd/24th (QRMP). Cannot be filed unless GSTR-1 for the period is filed. → See GST Guide §5 Returns
GSTR-9: Annual GST return — due 31 December of the following FY. Mandatory for aggregate turnover above ₹2 crore. → See GST Guide §5 Returns
GSTR-9C: Reconciliation statement between GSTR-9 and audited financials — mandatory for taxpayers with aggregate turnover above ₹5 crore. Self-certified since FY 2020-21. → See GST Guide §5 Returns
GTA: Goods Transport Agency — road transporter that issues consignment notes. Default 5% under RCM (no ITC for GTA), or 18% forward charge with ITC if the GTA opts in. → See GST Guide §12 RCM

H 1 term

HSN: Harmonized System of Nomenclature — global WCO classification for goods. India requires 4-digit HSN up to ₹5 crore turnover and 6-digit above; Table 12 enforces drop-down selection since May 2025. → See GST Guide §11 HSN & SAC

I 9 terms

IFF: Invoice Furnishing Facility — monthly B2B invoice upload for QRMP filers (capped at ₹50 lakh of invoice value per month) so buyers see ITC sooner. → See GST Guide §4 Composition & QRMP
Indexation: Cost-inflation-index adjustment applied to the cost of a long-term capital asset, increasing the cost base so only the real (inflation-adjusted) gain is taxed. Indexation for most LTCG was withdrawn by Finance Act 2024 (with grandfathering for pre-23 July 2024 immovable property). → See Income Tax Guide
Inverted Duty Structure: Where input GST rate is higher than output GST rate (e.g., textiles, fertilisers, EV inputs). Accumulated ITC is refundable under Rule 89(5) — formula restricted to inputs only. → See GST Guide §14 Refunds
IRN: Invoice Reference Number — 64-character SHA-256 hash issued by the IRP for every e-Invoice. Without an IRN, the buyer cannot claim ITC. → See GST Guide §7 e-Invoice
IRP: Invoice Registration Portal — NIC-operated portal that registers e-Invoices and returns the IRN + QR code. Rejects invoices reported beyond 30 days of date (AATO ≥ ₹10 cr). → See GST Guide §7 e-Invoice
ISD: Input Service Distributor — head office that distributes ITC on common-input services to branches. Mandatory from 1 April 2025, replacing cross-charge for common services. → See GST Guide §6 ITC
ITC: Input Tax Credit — GST paid on purchases that can be offset against GST collected on sales. Subject to four Section 16 conditions, the 180-day payment rule, and the 30 November outer deadline. → See GST Guide §6 ITC
ITR: Income Tax Return — the annual statement of income, deductions and tax filed with the Income Tax Department. The correct form (ITR-1 to ITR-7) depends on the taxpayer's status and income sources. → See Income Tax Guide
ITR-V: Income Tax Return Verification — acknowledgement generated on e-filing without e-verification. Must be e-verified or signed and posted to CPC Bengaluru within 30 days. → See Income Tax Guide

J 1 term

Journal: The book of original entry — every transaction is recorded chronologically as a journal entry before being posted to the ledger.

L 4 terms

Ledger: Account-wise summary of journal entries. The general ledger holds every account; subsidiary ledgers track receivables, payables, inventory and others.
LRS: Liberalised Remittance Scheme — RBI scheme allowing Indian residents to remit up to USD 250,000 per FY abroad for permitted purposes (education, travel, investment, gifts). TCS under Section 206C(1G) applies above the ₹10 lakh annual threshold (raised from ₹7 lakh with effect from 1 April 2025) — 5% for education / medical remittances, 20% for other purposes. → See TDS Guide
LTCG: Long-Term Capital Gain — gain on a capital asset held beyond the prescribed holding period (24 months for unlisted shares and immovable property; 12 months for listed equity, equity MFs and InvITs/REITs). → See Income Tax Guide
LUT: Letter of Undertaking (Form RFD-11) — lets exporters supply zero-rated without paying IGST. Renewed each financial year. → See GST Guide §14 Refunds

M 1 term

MAT: Minimum Alternate Tax — 15% (plus surcharge and cess) on book profits of companies. Ensures profitable companies pay tax even when reduced by exemptions and incentives. Inapplicable to companies opting for 115BAA / 115BAB regimes. → See Income Tax Guide

N 1 term

NaFAC: National Faceless Assessment Centre — administers faceless income-tax assessments, appeals and penalty proceedings without physical interaction with the assessee. → See Income Tax Guide

O 2 terms

OIDAR: Online Information & Database Access or Retrieval — cross-border digital services to Indian consumers. Foreign suppliers register under a simplified GST scheme and charge IGST. → See GST Guide §8 Place of Supply
Opening / Closing Balance: The balance of an account at the start (opening) and end (closing) of an accounting period. Closing balance of one period becomes the opening balance of the next.

P 5 terms

P&L Statement: Profit and Loss Statement (Statement of Profit and Loss) — shows revenue, expenses and net profit for a period. One of the three core financial statements.
PAN: Permanent Account Number — a 10-character alphanumeric ID issued by the Income Tax Department to every taxpayer. It links all tax records to one person or entity and is quoted on returns, high-value transactions and TDS deductions. → See Income Tax Guide
PGBP: Profits and Gains of Business or Profession — head of income under the Income Tax Act covering business and professional income. → See Income Tax Guide
Place of Supply: The deemed location where a supply is consumed. Together with the supplier's location it decides whether GST is CGST + SGST (intrastate) or IGST (interstate). → See GST Guide §8 Place of Supply
Prepayments: Expenses paid in advance for a future period (rent, insurance, AMC). Booked as a current asset and amortised to P&L over the period to which they relate.

Q 1 term

QRMP: Quarterly Return Monthly Payment — scheme for taxpayers up to ₹5 crore turnover. GSTR-1 and 3B filed quarterly, but tax paid monthly using fixed-sum or self-assessment method. → See GST Guide §4 Composition & QRMP

R 3 terms

RCM: Reverse Charge Mechanism — buyer pays GST instead of seller. Applies on specified categories under Section 9(3), real-estate purchases under 9(4), and import of services under IGST Section 5(3). → See GST Guide §12 RCM
Revised Return: Income-tax return filed under Section 139(5) to correct an originally-filed (or belated) return. Allowed up to 31 December of the AY. → See Income Tax Guide
ROR / RNOR / NR: Resident & Ordinarily Resident / Resident but Not Ordinarily Resident / Non-Resident — Section 6 residency categories that determine the scope of Indian taxation. → See Income Tax Guide

S 12 terms

SAC: Services Accounting Code — Indian classification for services. Two digits per chapter; mandatory on invoices and in GSTR-1 Table 12. → See GST Guide §11 HSN & SAC
Section 206AA: Higher TDS rate (20% or the applicable rate, whichever is higher) where the deductee fails to furnish PAN. Lower DTAA rate is denied. → See TDS Guide
Section 206AB: Earlier provision for higher TDS on non-filers of income-tax return — repealed with effect from 1 April 2025 by Finance Act 2025. No longer applicable. → See TDS Guide
Section 44AB: Income-tax tax audit provision — applies to businesses with turnover above ₹1 crore (₹10 crore if cash receipts and payments are each below 5%) and professionals above ₹50 lakh receipts. Audit report in Form 3CA/3CB + 3CD. → See Income Tax Guide
Section 44AD: Presumptive taxation for eligible businesses — income deemed at 6% (digital) or 8% (cash). Turnover up to ₹2 crore (₹3 crore if cash receipts are 5% or less of total turnover). → See Income Tax Guide
Section 44ADA: Presumptive taxation for specified professionals (CAs, doctors, lawyers, engineers, architects, etc.) — income deemed at 50%. Gross receipts up to ₹50 lakh (₹75 lakh if cash receipts are 5% or less of total). → See Income Tax Guide
Section 87A Rebate: Rebate that reduces tax liability for resident individuals with income up to the prescribed limit. Under the new regime, full rebate up to ₹12 lakh income from AY 2026-27. → See Income Tax Guide
SEZ: Special Economic Zone — supplies to SEZ units / developers are zero-rated under GST. Two refund routes (LUT or IGST paid) like exports. → See GST Guide §14 Refunds
SFT: Statement of Financial Transactions — high-value transaction report filed under Section 285BA by banks, registrars, depositories, MFs etc. Feeds into AIS. → See Income Tax Guide
STCG: Short-Term Capital Gain — gain on a capital asset held below the prescribed holding period. Listed equity STCG taxed at 20% (post Finance Act 2024); other STCG at slab rates. → See Income Tax Guide
STT: Securities Transaction Tax — small levy on transactions in listed equity shares, equity-oriented mutual fund units (including redemptions) and exchange-traded derivatives (futures and options) on Indian exchanges. Distinct from income tax; not refundable. → See Income Tax Guide
Surcharge: Additional levy on income tax payable above prescribed thresholds. New-regime surcharge is capped at 25%; old regime retains 37% for income above ₹5 crore. → See Income Tax Guide

T 9 terms

TAN: Tax Deduction & Collection Account Number — 10-character alphanumeric ID issued to every deductor / collector. Quoted on every TDS/TCS challan, return and certificate. → See TDS Guide
TAR: Tax Audit Report — Form 3CA/3CB + 3CD filed under Section 44AB by a CA. Due by 30 September of the AY (subject to extensions). Late fee under Section 271B applies. → See Income Tax Guide
TCS: Tax Collected at Source — tax a seller collects from the buyer on specified transactions under Section 206C (scrap, motor vehicles, foreign-tour packages, LRS remittances) and deposits against the buyer's PAN. The buyer claims it as a tax credit. → See TDS Guide
TDS: Tax Deducted at Source — tax the payer withholds from a payment (salary, interest, rent, professional fees, contracts) and deposits with the government against the payee's PAN. The payee claims it as a tax credit via Form 26AS. → See TDS Guide
Time of Supply: The point at which GST liability arises — earlier of invoice date or payment date for goods (Section 12) / services (Section 13). RCM rules differ: 30 days for goods, 60 days for services. → See GST Guide §9 Time of Supply
TIS: Taxpayer Information Summary — simplified, category-wise summary derived from AIS, showing processed values used by the income-tax department. → See Income Tax Guide
TRACES: TDS Reconciliation, Analysis and Correction Enabling System — the income-tax department's TDS portal where deductors download Form 16/16A, file corrections, view defaults and request justification reports. → See TDS Guide
TRC: Tax Residency Certificate — issued by the foreign country's tax authority, required to claim DTAA benefits in India along with Form 10F and a no-PE declaration. → See TDS Guide
Trial Balance: List of all ledger account balances at a point in time, with debits and credits totalled separately. Mathematical proof that double-entry is intact — but not proof of correctness.

U 1 term

Updated Return (ITR-U): Return filed under Section 139(8A) up to 48 months from the end of the relevant AY (extended by Finance Act 2025 from 24 to 48 months). Additional tax of 25% / 50% / 60% / 70% depending on lateness. → See Income Tax Guide

V 1 term

Voucher: Source document evidencing a transaction — sales invoice, purchase bill, payment receipt, journal entry, debit/credit note. In TatvaBooks (and Indian accounting generally), every posting is a voucher.

0–9 4 terms

24Q: Quarterly TDS return for salary payments under Section 192. Filed by every employer with employees on the payroll. → See TDS Guide
26Q: Quarterly TDS return for non-salary payments to residents (interest, rent, professional fees, contracts, commission, brokerage). → See TDS Guide
27EQ: Quarterly TCS return — Tax Collected at Source by sellers under Section 206C (scrap, motor vehicles, foreign-tour packages, LRS remittances, etc.). → See TDS Guide
27Q: Quarterly TDS return for payments to non-residents (including Section 195 remittances) and to foreign companies. Filed alongside Form 15CA / 15CB for outward remittances. → See TDS Guide

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