2 Replies to “Can an individual having two businesses, follow two different accounting methods?”

  1. As for as Business Income is concerned there are only two methods recognised under Income tax Act. Either Cash system of accounting or Mercantile system can be followed. Mixed or Hybrid system cannot be followed any more. If there are two businesses carried on by the same person, it is better to follow Mercantile system for both. under section 145A, irrespective of the method of accounting followed, purchase, sale of goods, and inventory should be valued as prescribed and interest on compensation if any, received, should be treated as income of the year in which it is received.

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