Escolar Documentos
Profissional Documentos
Cultura Documentos
Tax
( 2011-12)
INDEX
1.
2.
3.
4.
5.
6.
7.
8.
9.
Introduction
Residential Status
Tax Rates
Income from Salary
Income from House Property
Income from Business & Profession
Capital Gains
Income from Other Sources
Clubbing of Income
Contd
10.Set-off Carry Forward
11.Deductions from Gross Total Income
12.Agricultural Income
13. Advance Tax
14.Assessment Procedures
Important Definitions
1. Person u/s 2(31) includes,
i.
ii.
iii.
iv.
v.
An Individual,
Hindu Undivided Family (HUF),
A Company,
A Firm,
An Association of Persons(AOP) or Body of
Individuals (BOI),
vi. A Local Authority,
vii. Every other Artificial Juridical Person
Contd
2. Assessment Year u/s 2(9) means, the period of 12
months commencing on the 1st April every year. It is
the year (just after previous year) in which income
is earned is charged to tax. The current
Assessment is 2011-2012.
Contd
4. Gross Total Income (G.T.I) :- The aggregate
income under the 5 heads of income (viz. Salary,
House Property, Business or Profession, Capital
Gains & Other Sources) is termed as Gross Total
Income.
5. Total Income (T.I) :- Total Income of assessee is
gross total income as reduced by the amount
permissible as deduction under sections 80C to
80U.
Index
Non-Resident (NR)
Resident
Non-Resident
Basic Condition
Additional Condition
Contd
Basic Conditions u/s 6(1):
i. He must be in India for a period of 182 days or more during
the previous year; or
ii. He must be in India for a period of 60 days or more during the
previous year and 365 days or more during the four years
immediately preceding the previous year.
Residential Status
According to section 6(3) an Indian Company is always
Resident in India. A foreign Company will be resident in India
if Control or Management of its affairs is wholly situated in
India.
Residential Status of a firm or AOP or other person depends
upon control and management of its affairs.
Resident: If the control and management of the affairs of a firm or
AOP or other person is situated wholly or partly in India then such
a firm or AOP or other person is said to be resident in India.
Non-Resident: If the control and
management of the affairs of a
firm or AOP or other person is situated outside India then such a
firm or AOP or other person is said to be non-resident in India.
Tax Incidence
R
NOR
NR
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No*
No
Index
1.
INCOME
(A.Y. 20011-12)
TAX RATE
Up to 160000
NIL
Next 160001
500000
10%
500001
Up to 800000
20%
Above 800000
30%
Contd
2.
INCOME
(A.Y. 2010-11)
TAX RATE
Up to 190000
NIL
Next 190001
Next 500000
10%
Next 500001
Up to 8 00000
20%
Above 800000
30%
Contd
3.
TAX RATE
Up to 240000
NIL
Next 240001
Up to 500000
10%
Next 500001
Next 800000
20%
Above 800000
30%
Contd
PERSONS
TAX RATE
FIRMS
30%
DOMESTIC COMPANY
30%
FOREIGN COMPANY
40%
LOCAL AUTHORITIES
30%
CO-OPERATIVE SOCIETIES
Up to 10000
10000-20000
Above 20000
10%
20%
30%
RATE OF SURCHARGE
Nil
Firm
Nil
Domestic Company
Foreign company
Co-operative Society
N.A.
Local Authority
N.A.
Index
Meaning
Salary includes [section17(1)] :i. Wages
ii. Any annuity on pension
iii. Any gratuity
iv. Any fees, commission, bonus, perquisite on profits in lieu of
or in addition to any salary on wages
v. Any advance of salary
vi. Any earned leave
vii.Employers contribution (taxable) towards recognized
provident fund.
BASIS OF CHARGE
Income is taxable under head Salaries, only if there exists Employer Employee Relationship between the payer and the payee. The following
incomes
Salaries:1.Salary Due
2.Advance Salary [u/s 17(1)(v)]
3.Arrears of Salary
Note:
(i)Salary is chargeable on due basis or receipt
basis, whichever is earlier.
(ii)Advance salary and Arrears of salary are
chargeable to tax on receipt basis only.
Allowances
Allowance is generally defined as a fixed quantity of
money or other substance given regularly in addition
to salary for the purpose of meeting some particular
requirement connected with the services rendered by
the employee or as compensation for unusual
conditions of that service.
1.Dearness Allowance - It is Always Taxable.
2.City Compensatory Allowance - It is Always Taxable.
Contd
3.
House Rent Allowance Received by The Employee in Respect of The Period during which
Rental Accommodation is Occupied by the Employee during the Previous Year.
Contd
4. Entertainment allowance [sec.169(ii)]Entertainment allowance is first included in salary in come under
the head salaries and thereafter a deduction is given on the basis
enumerated below:
Status of Employee
Non- Government
Nothing is deductible
Government
Contd
5. Special allowances prescribed as exempt under
section 10(14) In the cases given below the
amount of exemption under section 10(14) is :
i.
ii.
Contd
Exemption is available on the aforesaid basis in the case of following allowances
NAME OF ALLOWANCE
:-
NATURE OF ALLOWANCE
Travelling Allowance/
Transfer Allowance
Conveyance Allowance
Daily Allowance
Contd
6. When exemption does not depend upon
expenditure - In the cases given below, the amount
of exemption does not depend upon expenditure
incurred by the employee. Regardless of the
amount of expenditure, the allowances given below
are exempt to the extent of
i.
ii.
Whichever is lower.
Contd
Name of allowance
Special Compensatory
(Hill Areas) Allowance
Amount exempt from tax varies from Rs. 300 per mount to Rs. 7,000 per
month
The amount of exemption varies from Rs. 200 Per month to Rs. 1,300 per
month
The amount exempt is limited to Rs. 100 per month per child up to a
maximum of two children.
It is exempt from tax to the extent of Rs. 300 per month per child up to a
maximum of two children.
Contd
Name of Allowance
Transport allowance
It is exempt up to Rs. 800 per month (Rs. 1,600 per month in the case of
an employee who is blind or orthopedically handicapped)
Underground allowance
It is exempt from tax up to Rs. 1,060 per month (for altitude of 9,000 to
15,000 feet) or Rs. 1,600 per month (for altitude above 15,000 feet).
Contd
7. Allowance to Government employees outside
India [Sec. 10( 7)] - Any allowance paid or
allowed outside India by the Government to an
Indian citizen for rendering service outside India
is wholly exempt from tax.
8. Tiffin allowance - It is taxable.
9. Fixed medical allowance It is taxable.
10.Servant allowance - It is taxable.
Contd
11. Allowance to High Court and Supreme Court
Judges - Any allowance paid to High Court Judges
under section & 22C of the High Court Judges
(Conditions of Service) Act, 1954 is not chargeable
to tax.
12. Allowance received from a United Nations
Organization - Allowance paid by a United Nations
Organization to its employees is not taxable by
virtue of section 2 of the UN (Privileges and
Immunities) Act,
1974.
PERQUISITES
Perquisite may be defined as any Casual Emolument
or Benefit attached to an office or position in Addition to
Salary or Wages. It also denotes something that
benefits a man by going in to his own pocket.
Perquisites may be provided in cash or in kind.
Perquisites are included in salary income only if they
are received by an employee from his employer.
Contd
3. The value of any benefit or amenity granted or provided
free of cost or at concessional rate in any of the
following cases :
i.
ii.
Contd
4. Any sum paid by the employer in respect of any
obligation which but for such payment would have been
payable by the assessee. Obligation of Employee met
by Employer.
5. Any sum payable by the employer, whether directly or
through a fund other than a recognized provident fund
or approved superannuation fund or a deposit-linked
insurance fund, to effect an assurance on the life of the
assessee or to effect a contract for an annuity
6. The value of any other fringe benefits or amenity as
may be prescribed
TERMINAL BENEFITS
1.
Status of Employee
Government Employee
Non-government employee
covered by the payment of
Gratuity Act, 1972
Contd
2.
COMMUTED
Government
Employee
Entire Commuted
Pension is exempt
whether or not Gratuity
received.
UNCOMMUTED
Non-Government
Employee
If Gratuity
Received
If Gratuity not
Received
1/3 of commuted
pension is
exempt
1/2 of commuted
pension is
exempt
Taxable for
Government as well
as Non-Government
employees
:-
Contd
3.Annuity [Sec. 17(1)(ii)] An annuity payable by a present
employer is taxable as salary even if it is paid voluntarily
without any contractual obligation of the employer. An annuity
received from an ex-employer is taxed as profit in lieu of
salary.
4.Retrenchment compensation [Sec. 10(10B)] Compensation
received by a workman at the time of retrenchment is exempt
from tax to the extent of the lower of the following:
a. an amount calculated in accordance with the provisions of sec. 25F(b)
of the Industrial Disputes Act, 1947; or
b. such amount as notified by the Government (i.e., Rs, 5, 00, 000); or
c. the amount received.
Contd
5. Compensation received at the time of
Voluntary Retirement [sec.10 (10C)] Compensation received at the time of
voluntary retirement is exempt from tax,
subject to certain conditions. Maximum
amount of exemption is Rs. 500000.
Provident Fund
Provident Fund Scheme is a welfare scheme
for the benefit of employees. The employee
contributes certain sum to this fund every
month and the employer also contributes
certain sum to the provident fund in
employees A/c. the employers contribution
to the extent of 12% is not chargeable to tax.
LEAVE SALARY
Encashment of leave by surrendering leave standing to ones credit is
known as leave salary.
LEAVE ENCASHMENT
During Employment
Chargeable to
Tax
Government
Employee
Fully Exempt
Non-Government
Employee
Relief in respect of
Advance or Arrears of Salary u/s 89
When an assessee is in receipt of a sum in the
nature of salary, being paid in arrears or in advance,
due to which his total income is assessed at a rate
higher than that at which it would otherwise have
been assessed, Relief is granted on an
application made by the assessee to the assessing
officer.
Index
Basis of Charge
The basis of charge of income under the head
income from house property is the Annual Value of
the property. Annual Value is inherent capacity of the
property to earn an income. It is the amount for
which the property might reasonably be expected to
let from year to year.
Income from house property is charged to tax on
Notional Basis, as generally tax is not on receipt of
income but on the inherent potential
of the house property to generate
income.
Conditions to be Satisfied
1. The property must consist of buildings or lands
appurtenant to such buildings.
2. The assessee must be the owner of such house
property.
3. The property should not be used by the owner
thereof for the purpose of any business or
profession carried on by him, the profits of which
are chargeable to tax.
Amount
xxx
xxx
Amount
XXX
xxx
XXX
Contd
Step 2 : Compare Expected Rent & Actual Rent
Received (ARR).
Where the property or any part thereof is let out,
If ARR is more than ER referred to in Step 1, then, GAV
= ARR
If ARR is less than ER and it is due the vacancy of
property then, GAV = ARR
If ARR is less than ER not owing to vacancy GAV = ER
Note: ARR = Rent Received / Receivable
Unrealized Rent
less
Meaning
1. Municipal Valuation :- For collecting municipal taxes,
local authorities make a periodical survey of all
building in their jurisdiction. Such valuation may be
taken as strong evidence representing the earning
capacity of a building.
2. Fair Rent of the Property :- Fair rent of the property
can be determined on the basis of a rent fetched by a
similar property in the same or similar locality.
3. Standard Rent :- Standard rent is the maximum rent
which a person can legally recover from his tenant
under a Rent Control Act.
Contd
In case of Self-occupied House Property Net
Annual Value is always Zero.
Since NAV is zero, the municipal taxes paid by
the owner of the house are not deductible.
MAXIMUM
DEDUCTION
1,50,000
30,000
AMOUNT
XXX
xxx
XXX
Index
Contd
5. any profit on transfer of the Duty Entitlement Pass
Book Scheme.
6. Any profit on the transfer of the duty free
replenishment certificate;
7. Export incentive available to exporters;
8. Any interest, salary, bonus, commission or
remuneration received by a partner from firm; Any
sum received for not carrying out any activity in
relation to any business or not to
share any know-how, patent,
copyright, trademark, etc.
Contd
9. Any sum received under a Keyman insurance
policy including bonus;
10. Profits and gains of managing agency; and
11. Income from speculative transaction.
Income from the aforesaid activities is computed in
accordance with the provisions laid down in section
29 to 44D.
Contd
8. Bonus or commission to employees [Sec. 36(1)(ii)]
9. Interest on borrowed capital [Sec. 36(1)(iii)]
10. Employers contribution to recognized provident fund
and approved superannuation fund [Sec. 36(1)(iv)]
11. Contribution towards approved gratuity fund [Sec.
36(1)(v)]
12. Employees contribution towards staff welfare
schemes
13. Bad debts [Sec. 36(1)(vii)]
14. Family planning expenditure [Sec. 36(1) (ix)]
Contd
15. Banking cash transaction tax,
securities
transaction tax and commodities transaction
tax.
16. Advertisement expenses [Sec. 37(2B)].
17. General Deduction [Sec. 37(1)].
Contd
6. Expenditure on raising equity share capital and
preference share capital. However, expenditure on
issue of bonus shares is deductible.
7. Amount paid for acquiring technical know-how which is
to be utilized for the purpose of manufacturing any new
article and such know-how is to become the property of
the assessee at the end of the stipulated period.
8. Amount expended for acquiring a business or a right of
permanent character or an asset
which
generates income or for
avoiding compensation in
business.
Contd
9. Payments made for acquisition of good will.
10. Expenditure incurred for acquiring right over or in
land to win minerals.
11. Fees paid to obtain license to investigate and
search minerals.
12. Payment made in consideration of acquiring a
monopoly right to manufacturer a producer (royalty
payable on the basis of goods produced under the
same arrangement is, however,
deductible).
Contd
13. Tax paid by the assessee (who is defaulter by not
deducting tax at source under section 195) on behalf of
non-resident.
14. Compensation paid to contracting party with the object of
avoiding an unnecessary investment in capital assets.
15. Expenditure on shifting of registered office.
16. Insurance premia paid by a firm on life insurance policies
of its partners.
17. Amount paid by liquor contractor to police staff and other
officer to enable it to make unauthorized purchases and
sales of liquor.
Contd
18. Amount paid by a company to the Registrar of
Companies as filing fee for enhancement of capital
base of the company.
19. Payment made by assessee company which was
partner in a firm, to outgoing partners of firm on
account of their agreeing to restrain from carrying
on similar business for a period of 15 years.
Specific Disallowances
1. Interest, Royalty, fees for Technical Services payable
outside India,if on such amount tax is deductible but tax
has not been deducted or deposited with Government.
[Sec. 40(a)(i)]
2. Fringe Benefit Tax [Sec. 40(a)(ic)]
3. Income-Tax [Sec. 40(a)(ii)]
4. Salary Payable Outside India without Tax Deduction [sec.
40(a)(iii)]
5. Provident Fund Payment without tax Deduction at
Source [Sec. 40(a)(iv)]
6. Certain specified expenses in case of Partnership Firm
Contd
7. Interest paid by an AOP/ BOI to its members is not
allowed as deduction by virtue of sec. 40(ba)
8. Payment to relatives in excess of fair value not
deductible [Section 40A(2)]
9. Expenditure in excess of Rs. 20,000 in aggregate in
a day paid otherwise than by account payee
cheque drawn on a bank or account payee bank
draft Not allowable [Section 40A(3))]
10. Amount not deductible in respect of certain unpaid
liabilities [Sec.43B]
Business
Profession
Business covered u/s 44AB, He has claimed his income to be lower than the profits or gains
44AE, 44AF, 4BB and 44BBB so deemed under the respective section.
Sec. 44 AE
Sec. 44AF
Business of
Assessee
Civil construction or supply of Plying, hiring or leasing goods Retail trade in any
labour for it.
carriages owned by him.
goods
or
merchandise.
This Section
applies if
Total
business
turnover
in
that
previous
year
doesnt exceed Rs.
40 lacs.
Deemed
Profits
8% of Gross receipts
5% of Gross receipts
or such higher sum
as declared by him
in his Return of
Income.
RKG
Contd
Block of Assets [Sec. 2(11)] - The term block of
assets means a group of assets falling within a
class of assets comprising
tangible assets, being buildings, machinery, plant or
furniture;
intangible
assets,
being
know-how, patents,
copyrights, trade marks, licenses, franchises or any
other business or commercial rights of similar nature.
In respect of which the same percentage of
depreciation is prescribed.
Contd
Written Down Value [Sec. 43(6)] - Written down value for
the assessment year 2009-10 will be determined as
under:
Find out the depreciated value of the block on the April 1, 2008.
Step 1
Step 2
Step 3
To this value, add actual cost of the asset (falling in the block) acquired
during the previous year 2008-09.
Contd
Meaning of Actual Cost [Sec. 43(1)] - It means the
actual cost to the assessee as reduced by the proportion
of the cost thereof, if any, as has been met, directly or
indirectly, by any other person or authority.
If written down value of the block of asset is reduced to
zero, though the block is not empty - No depreciation is
admissible.
If the block of assets is empty or ceases to exist on the
last day of the previous year though the
written down value is not zero - No
depreciation is admissible.
Contd
Additional depreciation @ 20% is available on new plant or
machinery acquired & installed after 31.03.05, if used in production
or manufacturing.
If asset is used for less than 180 days during the previous year, in
which its purchased, then deprecation & additional depreciation is
restricted to 50% of actual depreciation. However in subsequent
year full depreciation is allowed irrespective of use.
When a depreciable asset(on which depreciation is claimed on
straight line basis) of a power generating
unit is disposed in a
previous year, then
terminal depreciation (loss) is
deductible or
balancing charge (gain) is taxable.
Partnership
Deductibility of interest paid to partners by firm depends
upon following : Payment of interest should be authorized by the partnership deed
Payment of interest should pertain to the period after the
partnership deed.
Rate of interest should not exceed 12 percent
Contd
The maximum amount of salary paid to all the partners
during the previous year should not exceed the limits given
below :In case of a firm carrying of a profession referred to in section 44AA
On the first Rs. 1,00,000 of the book profit or in
case of a loss
Contd
A company is allowed credit of tax paid u/s 115JB for the assessment year 2006-07 and
onwards in accordance with the provisions of
section 115-JAA.
MAT credit can be carried forward for a period of
seven years.
Index
Basis of Charge
Capital Gains tax liability arises only when the
following conditions are satisfied:
1.There should be a capital asset.
2.The capital asset is transferred by the assessee
3.Such transfer takes place during the previous year.
4.Any profit or gains arises as a result of transfer.
5.Such profit or gains is not exempt from tax under
section 54, 54B, 54D, 54EC, 54F,
54G, and 54GA
Capital Assets
Capital asset is defined to include property of any kind, whether
fixed or circulating, movable or immovable, tangible or intangible.
However, following are excluded from the definition of capital
assets:
1.Any stock-in-trade, consumable stores or raw material held for the
purposes of business or profession.
2.Personal effects of the assessee, that is to say, movable property
including wearing apparel and furniture held for his personal use or for
the use of any member of his family
dependent upon him.
However, Jewellery,
Archaeological Collections, Drawings,
Paintings, Sculptures, or Art Work will not
be
considered as personal effects.
Contd
3. Agricultural land in India provided it is not situated
Short-term / Long-term
Capital Assets
Short term capital asset means a capital asset held by an
assessee for not more than 36 months, immediately prior to
its date of transfer. In other words, if a capital asset is held by
an assessee for more than 36 months, then it is known as
long term capital asset.
However in following cases 36 months will be replaced by 12
months : Equity or preference shares in a company
Listed Securities
Units of UTI
Units of a mutual fund specified under section 10(23D)
Zero coupon bonds
Important Terms
1. Transfer of Capital Asset :- Transfer, in relation to capital
asset, includes sale, exchange or relinquishment of the
asset or the extinguishment of any rights therein or the
compulsory acquisition thereof under any law [sec.
2(47)].
2. Full Value of Consideration :- The expression full value
means the whole price without any deduction
whatsoever.
3. Expenditure on Transfer :- The expression expenditure
on transfer means expenditure incurred which is
necessary to effect the transfer.
Contd
4. Cost of Acquisition :- Cost of acquisition of an asset
is the value for which it was acquired by the
assessee. In case of Depreciable Asset COA is the
WDV of asset in the beginning of the year. In case
of Slump Sale COA is the Net Worth of the
undertaking.
5. Cost of improvement :- Cost of improvement is
capital expenditure incurred by an assessee in
making any additions/ improvement to
the capital asset.
Contd
6. Indexed Cost of Acquisition :- the amount which bears
to the COA, the same proportion as CII for the year in
which the asset is transferred bears to the CII for the
first year in which the asset was held by the assessee
or on 01.04.1981, whichever is later.
7. Indexed Cost of Improvement :- an amount which
bears to the COI, the same proportion as CII for the
year in which the asset is transferred bears to the CII
for the year of improvement.
Contd
3. Investment in certain bonds [S.54EC] :Available to all assesses on transfer of any
long-term capital asset for purchase of Bonds,
redeemable after 3 years issued by
(a) National Highway authority of India; or
(b) Rural Electrification Corporation,
Contd
4. Capital gain on transfer of certain capital assets
not to be charged in case of investment in
residential house [S. 54F]:- Available to
Individual & HUF on transfer of Long-term Asset
other than Residential house Property and
residential House property is purchased or
constructed.
Contd
5. Compulsory acquisition of land & building
[S.54D]:- Available to all assesses on
Compulsory acquisition of land or building
which was used in the business of industrial
undertaking during 2 years prior to date of
transfer, if New land or building for the industrial
undertaking is purchased or constructed.
Contd
6. Shifting of undertaking to rural area [Sec.54G]:Available to all assesses on Transfer of plant,
machinery or land or building for shifting industrial
undertaking from under area to rural area, if (a)
Purchase/ Construction of plant, machinery, land or
building in such rural area or, (b) Shifting original
assets to that area or, (c) Incurring notified
expenses.
Contd
7. Shifting of undertaking to SEZ [Sec.54GA]:Available to all assesses on Transfer of plant,
machinery or land or building for shifting
industrial undertaking from urban area to
special Economic Zone, if (a) Purchase/
Construction of plant, machinery, land or
building in such SEZ or (b) Shifting the original
asset to SEZ or, (c) Incurring notified expenses.
Computation of Short-term
Capital Gains
Particulars
Amount
XXX
such transfer
xxx
XXX
xxx
xxx
xxx
XXX
Computation of Long-term
Capital Gains
Particulars
Amount
XXX
such
xxx
XXX
xxx
xxx
Less: Exemption u/s 54, 54B, 54D, 54EC, 54F, 54G, 54GA
xxx
XXX
Indexed Cost
Indexed Cost
of
Acquisition /
Improvement
Cost of
acquisition /
improvement
x Cost
inflation Index
of the year of
transfer
Index
Contd
5. Income from letting on hire of Plant, machinery or
furniture belonging to the assessee, if not chargeable
to under the head Profits and Gains of Business or
Profession.
6. Income from letting on hire of machinery, plant or
furniture and also buildings, and the letting of
buildings is inseparable from letting of such
machinery, plant or furniture, if the same is not
chargeable to income tax under the head Profits and
Gains of Business or Profession.
7. Interest on bank deposits and loans
Contd
8. Any sum received under a Keyman insurance policy
including the sum allocated by way of bonus on such
policy, if the same is not chargeable to income-tax under
the head Profits and Gains of Business or Profession
or under the head Salaries.
9. Cash Gifts exceeding Rs. 50,000
10.Interest on foreign government securities
11. Agricultural income received from outside India
12.Income from sub-letting
13.Directors fee
14.Income of race establishment
Index
Contd
4. An individual is assessable in respect of income
from assets transferred to spouse:- When the asset
is transferred otherwise than (a) for adequate
consideration, or (b) in connection with an
agreement to live apart.
5. An individual is assessable in respect of income
from assets transferred to sons wife [Sec. 64(1)
(vi)]:- When the asset is transferred otherwise
than (a) for adequate consideration
Contd
6. An individual is assessable in respect of income from
assets transferred to a person for the benefit of
spouse [Sec. 64(1)(vii)] :- It is transferred for the
immediate or deferred benefit of his/her spouse. The
transfer is without adequate consideration.
7. An individual is assessable in respect of income from
assets transferred to a person for the benefit of sons
wife [Sec. 64(1)(viii)] :- It is transferred for the
immediate or deferred benefit of his/her
sons wife. The transfer is without
adequate consideration.
Contd
8. An individual is assessable in respect of income of
his minor child [Sec. 64(1A)] :- The income of minor
will be included in the income of that parent whose
total income [excluding the income includible under
section 64(1A)] is greater.
9. Clubbing in case of transfer of property to HUF
[Section 64(2)] :- When Income from asset
transferred to HUF for inadequate consideration.
Contd
2. Unexplained investments [Sec.69] Where in
the financial year immediately preceding the
assessment year, the assessee has made
investments which are not recorded in the
books of account maintained by him and the
assessee offers no explanation about the
nature and source of the investments, the value
of the investments may be deemed to be the
income of the assessee of such
financial year.
Contd
3. Unexplained money, etc [sec. 69A] - Where in
any financial year the assessee is found to be
the owner of any money, bullion, jewellery, or
other valuable article which are not recorded in
the books of account maintained by him and the
assessee offers no explanation about the
nature and source of acquisition then value of
such things may be deemed to the income of
the assessee for such financial
year.
Contd
4. Amount of investments, etc., not fully disclosed in
books of account [Sec.69B] Where in any financial
year the assessee has made investments or is found
to be the owner of any bullion, jewellery or other
valuable article, and the A.O. finds that the amount
expended on making such investments or in acquiring
such things exceeds the amount recorded in the books
of account maintained by the assessee, and he offers
no explanation about such excess amount, the
excess amount may be deemed to be the income of
the assessee, for such
financial year.
Contd
5.Unexplained expenditure, etc. [Sec. 69C] Where in any
financial year an assessee has incurred any expenditure & he
offers no explanation about the source of such expenditure,
the amount covered by such expenditure, may deemed to be
the income of the assessee for such financial year.
6.Amount borrowed or repaid on hundi [Sec. 69D] Where any
amount is borrowed on a hundi, or any amount due thereon is
repaid otherwise than through an account payee cheque, the
amount so borrowed or repaid shall be deemed to be the
income of the person borrowing or
repaying for the
previous year in which
the amount was borrowed or repaid.
Index
Step 2
Step 3
Carry forward of loss. Step 3 is applied only if a loss cannot be set off
under Steps 1 and 2.
Unabsorbed Depreciation
While dealing with unabsorbed depreciation one should keep in mind
the following points:
Step 1
Step 2
If depreciation allowance is not fully deductible under the head Profits and
gains of business or profession because of absence or inadequacy of
profits, it is deductible from income chargeable under other heads of income
[except income under the head Salaries] for the same assessment year.
71B
72
Profits of any
Business/Profession
(including speculation
business profits also)
73
Income
business
74
Capital Gains
74A
from
Index
Meaning
Agricultural Income means:
1. Any rent or revenue derived from land which is situated in
India and used for agricultural purposes [sec. 2(1A) (a)].
2. Any income derived from such land by agricultural operations
including processing of the agricultural produce, raised or
received as rent-in-kind so as to render it fit for the market or
sale of such produce [sec. 2(1A)(b)].
3. Income attributable to a farm house subject to certain
conditions.
4. With effect from the assessment year 2009-10, any income
derived from saplings or seedlings grown in a nursery shall be
deemed to be agricultural income.
AGRICULTURAL
INCOME
40%
60%
35%
65%
25%
75%
40%
60%
INCOME
Growing and manufacturing tea in India
Sale of centrifuged latex or cenex or latex based
creps (such as pale latex crepe) or brown crepes
(such as estate brown crepe, remilled crepe,
smoked blanket crepe or flat bark crepe) or
technically specified block rubbers manufactured or
processed from field latex or coagulum obtained
from rubber plants grown by the seller in India
Condition 2
Contd
Income-tax will be computed for the assessment year
2009-10 in the following manner:
Step 1
Step 2
Agricultural & non-agricultural income of the assessee will then be aggregated & income-tax is
calculated on the aggregate income.
Step 3
The net agricultural income will then be increased by the amount of exemption limit and incometax is calculated on net agricultural income, so increased, as if such income was the total income
of the assessee.
Step 4
The amount of income-tax determined at Step two will be reduced by the amount of income-tax
determined under Step three.
Step 5
Find out the balance. Add surcharge; education cess & SHEC.
Step 6
The amount so arrived will be the total income-tax payable by the assessee.
Index
Introduction
Deductions to be made [Section 80A] :
The total income of an assessee is to be computed after
making deductions permissible u/s 80C to 80U. However,
the aggregate amount of deductions cannot exceed the
Gross Total Income.
No deduction from certain (following) Incomes :
Long term Capital Gains referred u/s 112, and Short Term Capital
gains referred u/s 111A.
Winnings from lotteries, races, etc. as referred to in section 115BB.
Incomes referred to in section 115A (1) (a), 115AC, 115ACA,
115AD, 115BBA and 115D.
Deduction In Respect Of
Health Insurance Premia [Sec. 80D]
Deduction is available in respect of the amount paid to
effect or to keep in force health insurance under a
scheme
made by General Insurance Corporation of India (GIC) and
approved by Central Government; or
made by any other insurer and approved by Insurance Regulatory
and Development Authority.
Deduction in respect of
Medical Treatment, etc. [Sec. 80DDB]
Deduction is available in respect of sum actually paid during
previous year for medical treatment of prescribed disease
or ailment for the following
In case of individual: himself or his spouse, children, parents,
brothers and sisters,
In case of HUF: its member(s),
dependant mainly on such individual or HUF for his support and
maintenance.
Other Deductions
Deduction in respect of certain Donations for Scientific
Research or Rural Development [Sec.80GGA]
Deduction in respect of Contribution to Political Parties
[Sec. 80GGB & 80GGC]
Profits & Gains from Industrial Undertaking engaged in
Infrastructure Development [Sec. 80 IA]
Profits & Gains from Undertaking engaged in
Development of SEZs [Sec. 80IAB]
Profits & Gains from Industrial Undertaking engaged in
other than in Infrastructure Development [Sec.80IB]
Contd
Deduction available to certain Undertakings in certain
Special category States [Sec.80IC]
Profits & Gains from business of Hotels & Convention
Centre in Specified Areas [Sec. 80ID]
Special provisions in respect of certain Undertakings in
North-Eastern States [Sec. 80IE]
Deduction available to assessee in the business of
Collecting & Processing Bio-Degradable Waste
[Sec.80JJA]
Deduction in respect of Employment of New Workmen
[Sec. 80JJAA]
Contd
Deduction from incomes of Off-shore Banking Units
& International Financial Services Centre [Sec.80LA]
Deduction in respect of income of Co-operative
Society [Sec. 80P]
Deduction in respect of Royalty Income, etc. of
Author of certain Books other than Text Books
[Sec.80QQB]
Deduction in respect of Royalty Income of Patents
[Sec. 80 RRB]
Index
Due Dates
Due Date
Interest is
payable on
Rate of interest
Index
September 30
September 30
July 31
Index
INCOME TAX