Taxation is one of the most lucrative fields for Chartered Accountants. But ironically, it is the most dreaded subject of the curriculum for most CA students. In this post, let's see how studying DT and scoring good marks in the exam can be made a bit easier...
My love-hate affair with Tax
I normally do not like to narrate my own stories to you all, simply because they seem a bit too contrary to the general perception of CA students.
I know many of you would stop reading this post right at this moment if I admit that Taxation was one of my favourite subjects of the CA course and I achieved 80 out of 100 in my IPCC Tax paper through 100% self-study. Looking back though, I feel that this love for Tax paid me rich dividends (yes, the exempt ones!). I did face a break-up with Tax in CA Final in what was a really tough paper. But I still managed to score a decent 57, while some of my friends struggled to cross 40.
The Strategy - How to Study and Score 60+
So this is the background story with which I plan to pen down 10 strategies that worked for me in the DT paper. Read on...
Strategy 1 | Darr ke aage jeet hai
Most CA students start their preparation for Tax with a preconceived notion that it is a draconian subject, very tough to score off, and very difficult to memorize. I know that this ideology is somewhat passed on from one batch to another, but it is totally baseless. Tax is not a paper to be so afraid of, and it is very much possible to score good marks. So the first and foremost thing to do is to do some formatting of your hard disk and start your preparation with a positive mind. Shower as much love as you possibly can on this subject and it will definitely reward you back!
Strategy 2 | Get the best and most updated resources
It is imperative that you study Tax from the best and the most updated resources, because it is a subject full of new amendments and case laws. Whether you want to self-study or take classes is absolutely your choice and I do not want to comment on that. But I can tell you what I did for my prep. These were the resources I used:
ICAI Study Material - This is the best possible material to start preparation. The language can be a bit difficult to memorize, but that is not how you study Tax. It is all about understanding the concepts here.
Questions - I had the privilege of the Practice Manual, something which has been partially incorporated into the SM itself now. This is where the memorization starts to kick in. The more you practice and the more you come across the same provision again and again, the better is the retention process.
MTP - I solved the ICAI Mock Test Papers for the last 4 terms. Doing this gives you the confidence that your prep is on track. I have discussed this aspect separately in this post - Which is the best Mock Test Series in India for CA exams
Past Papers - I used the Past Papers in 2 ways:
(a) As a means to get a feel of the level of difficulty of questions asked in the exam
(b) Analyze the weightage of chapters that can't be missed revising the day before the exams.
RTP - This is the best resource available if you want to know about all the relevant case laws and amendments happening in the field of Taxation at one place. It also gives the idea as to what type of new questions can be generated from some of the most neglected topics of the syllabus.
Case Laws - However you might hate to read the case laws, they are important for the exam. And the ICAI publication is the best book for reading the case laws.
Strategy 3 | Know the weightage
The Old Syllabus students were fortunate enough to have the Practice Manual, along with an analysis of the weightage of all the chapters in terms of marks. But this has been discontinued by the ICAI to establish the perception that the volume of the material to be covered has been reduced in the New Syllabus. So let me share with you the weightage of chapters from the exam point of view as published on the ICAI website:
As you can see, it is pretty easy to score 40 marks out of the paper if you have emphasized on the right chapters. The key is to know how to study those chapters. Let's see this in the next strategy...
Strategy 4 | How to study Tax
I would recommend you to follow the following tips to ensure the subject of Tax does not become too taxing for you:
It is best to start with the concepts first. Refresh the basic concepts of previous year, assessment year, income, assessee, tax rates, exemptions, and other basic tax terms once to refresh your memory of your Intermediate days.
Thereafter, you should start with the 5 heads of income. Start in order - Salary, then HP, then PGBP, then CG and lastly, IoS. This will also help you memorize the important sections.
Remember not to spend too much time on PGBP. You simply cannot afford to spend one full month on just PGBP alone. You will realize that a lot of the provisions you might already remember due to your Articleship experience.
Now is the time to take up the more theoretical chapters like Deductions, Advance Tax, TDS, Clubbing, Set-off & Carry Forward, Assessment, Penalties and the other chapters.
Don't try to memorize the TDS, Set-off and Penalties chapters - you will simply forget everything the moment you close the book and get up from your chair. Build an understanding of these chapters and read them repeatedly to soak the content into your brain.
Lastly, get into the Computation of Total Income chapter. It will require the understanding of all the chapters you have read till now. And it will start to make more sense as you start solving the questions on your own.
Practice as much as you can. Do not give up on the basis of initial difficulties in retaining or memorizing content. Do not also give up on the basis of the initial mistakes you do while solving sums.
Note down your mistakes in a separate diary or a copy. During the revision stages, just go through them so that you are extra cautious in the areas where you are more prone to commit mistakes.
Strategy 5 | Prepare for the MCQs
Not many people would be aware, but the Tax paper in CS Executive is 100 marks totally MCQ. And I can tell you from my experience, that it isn't easy at all. Obviously, I cannot compare the levels of the paper of both CA Final and CS Executive, but handling MCQs in Tax is definitely not easy. It takes a good bit of time to think through the provisions needed to be applied to the question, and then run your fingers around on the calculator to find the correct answer. Many people have this habit of double-checking their calculations, and they only lose further time. So this is something you need to be prepared for beforehand, and needless to say, it is only advisable to practice as many MCQs as possible before the exam.
For further advice on how to handle MCQs in exams, you can read my post here:
Strategy 6 | It's a demanding love affair
Tax is a pretty demanding love affair because it will require both time and attention. So you need to be a bit patient with it, give it the time and study regularly. My advice to you all would be simple - start early and be regular. Make it a routine to study Tax for at least 1 hour daily, just like brushing your teeth every morning or maybe texting your BF/GF every day - you need your love affair with Tax to be that intense.
Strategy 7 | Be the MSD
Do not count the number of days you are taking to grasp the concepts of Tax or to increase your accuracy while solving questions. Tax is a subject where the marks are directly proportional to the amount of time you have invested in studying the subject. So it makes absolute sense to take it slow and steady, and take it deep - just like Dhoni finishing off the game in style in the last over of the match.
Strategy 8 | Prepare summarised notes
Remember that you will have to revise the entire subject in just a day before the exam. So it is always better to prepare short summarised notes for each chapter and to revise just those quickly. If you are thinking of just flipping through the ICAI study material or the 7 volumes of your coaching class notes on the day before the exam, you might just be waiting for a rude shock. A very renowned Tax faculty says "Tax is not hard, it is just lengthy", and it is only this habit of preparing summarised notes which can save you from some last-minute panic attacks on the day before the exam.
Strategy 9 | Extra effort for extra rewards
This strategy is for those who are looking to score 60+ in Tax. As a CA student reading and applying laws, it is expected by the ICAI that you would try and remember certain important section numbers, at least in Tax. It is sort of inappropriate on the part of a CA student to not remember some of the most commonly used section numbers in Tax - some sub-sections of Section 10, Section 80C, Section 48, etc. Writing the correct section numbers in your answer just boosts up the impression of the Evaluator and can even result in earning some brownie points.
In CA Final, case laws form an integral part of the syllabus. As a tax practitioner, I can guarantee that remembering landmark judgements and case laws will be a part of your daily duty. So it is better to start now and take that extra pain to memorize not only the crux of each case law, but also to memorize the names of the important judgements. What I had done was to prepare a Table of all the important case laws. I am attaching here a snapshot of what I did:
This Table made things really easy for me to memorize, and it took me just 3 days to memorize this entire Table containing 130 case laws.
Strategy 10 | Thorough net practice before the match
This is the last strategy, and the most important one. You need to put yourself through a rigorous round of net practice before the main match. You need to ensure that you solve at least 4 papers - either the Mock Papers or the Past Papers - in 100% exam conditions. This will only act as a reflection of how strong your prep is and in what areas are you lacking. Most students miss this strategy or treat it as unimportant and end up suffering.
Conclusion
Lastly, all I can say is that Tax is one of those subjects which demands time and affection. The more you love this subject, the subject will love you back. And I am not writing all this just for the sake of it; this is all coming from experience. I can assure you this much, that if you are able to follow these 10 strategies discussed here, no one can stop you from scoring heavily in this paper - something which can play out to be a huge game-changer between a Pass and a Fail in Group 2 of the CA Final exams.
More in the Strategy Series:
Hope this post helps students to study Tax in a better manner...
Please feel free to get in touch with me if you have any queries, suggestions or feedback.
Thanks for reading:)