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Salary Income Tax
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Income From Sources Other Than Salary
 

1. Example for Income under the head Salary:
Mr. X, is employed at Delhi as Finance Manager of R Ltd. The particulars of his salary for the previous year 2009-10 are as under:

Particulars Amount Rs.


Basic Salary

Dearness allowance

Transport allowance

Medical allowance

House Rent allowance

Children Education Allowance for 3 children

Special Allowance


Rs.18,000/-Pm

Rs.7,200/-p.m.

Rs.1,000/-p.m

Rs.1,250/-p.m

Rs.7,000/-pm

Rs.400/-pm per child

Rs.8,000/-p.m

The actual rent paid by him Rs.8,000 pm. Compute Income under the Salary.


Computation of Income from Salary


  Name of Assessee: Mr. X   Assessment Year 2010-11
Previous Year 2009-10
Particulars Amount Rs. Amount Rs.

Basic Salary (Rs. 18,000 x 12)
Dearness allowance (Rs. 7,200 x 12)
Taxable Transport allowance (Rs. 1,000 x 12)
Actual amount received
Less: Exemption u/s 10(14) @ Rs.800 p.m. (800 x 12)
Taxable Children Education Allowance
Actual amount received (400 x 12 x 3)
Less: Exemption u/s 10(14)
@ Rs.100 per month per child
subject to a maximum of 2 children (100 x 12 x 2)
Medical allowance
Actual amount received
Less: Exemption u/s 10
subject to a maximum of Rs. 15,000/-
House Rent allowance
Actual amount received (Rs. 6,000 x 12)
Less: Exemption u/s 10(13A)
Least of the followings:
(a) Actual HRA amount received               72,000
(b) 50% of salary   (50% of 3,02,400*)        1,51,200
(c) Rent paid €“ 10% of Salary
[(Rs. 8,000x12)- 10% of Rs. 3,02,400)]     65,760

Special Allowance (Rs. 18,000 x 12)

 

 

12,000
9600

14,400

2,400

 

15,000
15,000

 

72,000

 

 

62,400

2,16,000
86,400

 

2,400

 

12,000

 

Nil

 

 

 

 

6,240

96,000

Gross Salary
Less: Deduction Under Section 16

 

     4,19,040
Nil

Income Under the Salary

4,19,040




2.Example for Income under the head House Property:

Namrata is the owner of a big house consisting of two units.

Particulars Unit-I (Let out)

Unit-II (Self occupied)

Rent Received

Municipal Tax Paid

Interest on Loan taken dated 20th May 2008

Rs. 1,20,000

Rs. 2,500

Rs, 60,000

Nil

Nil

Rs. 60,000

She had paid Insurance premium, Rs 6,000. She has an income from salary Rs 4,20,000.
Compute her Total Taxable Income for the assessment year 2010-2011


Computation of Total Taxable Income


Particulars Amount Rs. Amount Rs.

i). Income under the head Salary:
     Income From Salary
ii). Income from House Property:
    Loss from House Property( As per Note)

 

 

4,20,000

(1,49,500)

Grass Total Income
Less: Deduction Under Chapter VI-A
          Deduction U/s 80C
- Insurance premium

 

 

6000

2,70,500

 

6000

Income Under the Salary

 

2,64,500


Income from House Property

Particulars Unit-I (Let out) Unit-II(Self occupied)

Gross Annual Value (G.A.V)

Rs. 1,20,000

Nil

Less: Municipal Taxes

Rs. 2,500

Nil

Net Annual Value

Rs. 1,17,500

Nil

 

 

 

Less: Deduction under Section 24 :

 

 

(a) Standard deduction @ 30%

Rs. 47,000

Nil

(b) Interest on borrowed capital
(Self Occupied- Subject to Maximum deduction allowed Rs. 1,50,000/-.)

Rs. 60,000

Rs.1, 50,000

 

 

 

Income/(Loss) from House Property

Rs. 10,500

(Rs. 1,50,000)

Net Loss from House Property

(Rs. 1,49,500)


3.Example for Income under the head Profession:

Mr. Gopi was working as Project Manager for 7 months in ZP System Private Company and his Income From Salary Rs. 3,60,000. From 1st October, 2009 he started receiving income from consultancy, details are given below:

Income & Expenditure Account

Expenditure Amount Rs. Income Amount Rs.

To Electricity and water
To Purchase of professional books
To Telephone Charges
To Salary Paid
To Printing & Stationery
To Office Expenses
To Life Insurance premium
To Petrol Expenses
To Deprecation
To General expences
To Income over expenditure

12,000
18,000
32,000
1,80,000
24,000
6,010
5,020
70,000
14,450
18,000
5,00,520

By Consultation fees Received
By Visiting fees
By Commission Received
By Interest on Fixed Deposit

4,67,000

1,60,000
2,25,000
28,000

 

 

Income Under the Salary

8,80,000

 

8,80,000


Compute his Total Taxable Income and Tax payable from above details for the Assessment year 2010-09.

Note: TDS on Profession as per Form 16A is Rs. 59,700/-,advance Tax - 85,000/-and as per Form 16 (TDS on Salary) Rs. 20,600/-.


Computation of Total Taxable Income


Particulars Amount Rs. Amount Rs.

ii). Income under the head Salary:
     Income From Salary (for 7months)

ii). Income from Profession:
    Income From Profession ( As per Note)

iIi). Income from Other source:
Interest on Fixed Deposit     

 

 

3,60,000

5,42,250

 

28,000

Grass Total Income
Less: Deduction Under Chapter VI-A
          Deduction U/s 80C
- Insurance premium

 

 

70,000

9,30,250

 

70,000

Total Taxable Income

 

8,60,250

Tax on Taxable Income:
Tax amount
Surcharges
Education Cess @ 3%
Total Tax Payable

1,62,075
Nil
4862

 

 

1,66,937

Less:
(i). Advance Tax
(ii). TDS
          -As per Form 16
-As per Form 16A

 85,000

20,600
59,700

 

 

165,300

Self Assessment Tax U/s 140A

 

1637


Income from Profession

Particulars Amount Rs. Amount Rs.

 Income from Profession:
Income over Expenditure (As per Income & Exp A/c)
Less: Interest on Fixed Deposit
Add: Life Insurance premium

 

(28,000)
70,000

 

5,00,520
(28,000)
70,000

Income from Profession

 

5,42,250


4.Example for Income under the Capital Gains:

Mr. A is an employee in  Sony Soft Pvt Ltd and he is receiving taxable salary of Rs. 6,30,000 (TDS Rs. 75,000)   for the financial Year 2009-10 and He transfers land and building on 02.09.2009 furnishes the following information:

  1. Net Consideration received Rs. 12 Lakhs
  2. This land & Building was purchased by Mr. A on 1.12.03 Rs. 5,10,000.
  3. On 31.03.2010 he purchased on more house property for Rs. 7,60,000.
  4. On 21.01.2010 Mr. A sale 1,000 Shares for Rs. 12,500, purchase on 10.05.2009 for Rs. 9,000.
  5. He invested amount of Rs. 60,000 in LIC and Rs. 10,000 in Med claim.

Compute his Total Taxable Income and Tax payable from above details for the Assessment year 2010-09.


Computation of Total Taxable Income 

Name of Assessee: Mr. X   Assessment Year 2010-11 Previous Year 2009-10
Particulars Amount Rs. Amount Rs.

i). Income under the head Salary:
     Income From Salary

ii). Income from Capital Gain:

  1. Long Term Capital Gain ( As per Note)
  2. Short-Term Capital Gain ( As per Note)

 

 

Nill
3,500

 

6,30,000

 

3,500

Gross Total Income
Less: Deduction Under Chapter VI-A
          Deduction U/s 80C

  1. Life Insurance premium

           Deduction U/s 80D
-     Mediclaim

 

 

60,000

10,000

6,33,500

 

 

70,000

Total Taxable Income

 

5,63,500

Tax on Taxable Income:
Tax at Normal Rate
Surcharges @10%
Education Cess @ 3%
Total Tax Payable


73,050
Nil
2192

 

 

75,242

Less:
(i). TDS
          -As per Form 16

 

75,000

 

75,000

Self Assessment Tax U/s 140A

 

242

 

Note:
Long Term Capital Gain:
Capital Asset: Land & Building
Holding Period: More than 36 Months
Particulars Amount Rs.

Sale Consideration
Less: Expenses on Transfer

12,00,000
(Nil)

Net Consideration
Less: Indexed Cost of Acquisition
(5,10,000 x 632 /463)

12,00,000

(6,96,155)

Taxable Long Term Capital Gain
Less: Exemption U/s 54

5,03,845
(5,03,845)

Net Taxable Long Term Capital Gain

Nil


Short Term Capital Gain:
Capital Asset: Shares
Holding Period: Less than 12 Months

Particulars Amount Rs.

Sale Consideration
Less: Expenses on Transfer  

12,500
Nil

Net Consideration
Less: Cost of Acquisition

12,500
9,000

Net Taxable Short Term Capital Gain

3,500


 
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