Rounding off of taxable income and tax has been prescribed under section 288A and 288B of IT act, 1961. According to section 288A you need to round off your taxable income to the nearest multiple of 10 rupees. While deriving paise should be ignored. Section 288B talks about rounding off of tax payable or refund. According to this section, any amount of tax payable or … [Read more...] about Rounding off of taxable income and tax in India
Income tax
How agricultural income is taxable in India
Agricultural income is exempted in India. The power to levy tax on agricultural income is with the state government. Central government cannot impose tax on it. For this reason, under section 10 (1) of IT act it has been specifically said that agricultural income will not form part of the total income and as such will be exempted from tax. In the finance act, it has been … [Read more...] about How agricultural income is taxable in India
Definition of Agricultural income as defined under section 2(1A) of income tax act.
Agricultural income means - (a) Any rent or revenue derived from land which is situated in India and is used for agricultural purposes; (b) Any income derived from such land by— (i) Agriculture; or (ii) the performance by a cultivator or receiver of rent-in-kind of any process ordinarily employed by a cultivator or receiver of rent-in-kind to render the produce … [Read more...] about Definition of Agricultural income as defined under section 2(1A) of income tax act.
How to derive residential status of companies
Income tax in India will be charged based on the residential status of your company. Residential status of a company is based on the place of company’s control and management of its affairs. If your company is register in India then it will be treated as a resident under the provisions of IT act. An Indian company will be always treated as resident. … [Read more...] about How to derive residential status of companies
FAQ on residential status of Individual
Can any person be a resident of more than one country Yes, a person can be resident of more than one country. If you are a resident of India as per the provisions of Indian income tax act then it does not mean that you will be treated as non resident for other countries. Different countries have different set of income tax act and rules. If after becoming a resident in … [Read more...] about FAQ on residential status of Individual
How to derive Residential Status of an individual – section 6 of income tax act
Residential status of an individual decides whether the person is taxable or not in our country. You need to determine residential status of each year to know whether you are taxable in that year or not. To determine residential status you need to first find out whether you are a resident or non resident. If you are a resident then in the next step you need to determine … [Read more...] about How to derive Residential Status of an individual – section 6 of income tax act
Business Expenditure in Cash is permitted up to Rs. 20, 000 – Section 40A(3)
Business expenditure paid in cash to a person in a single day is allowed up to Rs. 20, 000. If you make different payments at a different time in a single day which aggregate to more than Rs. 20, 000 then the entire expenditure will be disallowed as business expenditure. In the case of plying, hiring or leasing goods carriage business the limit of cash expenditure under … [Read more...] about Business Expenditure in Cash is permitted up to Rs. 20, 000 – Section 40A(3)
TDS on Rent – Section 194I of Income Tax Act
TDS on rent has to be deducted under section 194I where the aggregate amount paid or credited or likely to be paid or credited to the account of recipient exceeded Rs. 1, 80,000 during the financial year. However, if you are jointly owner of a property then this limit will be applicable to each such joint owner i.e. TDS on rent will be deducted only when the limit of Rs. … [Read more...] about TDS on Rent – Section 194I of Income Tax Act
Advance Tax Payment Due dates and Interest provisions for non payment
Taxpayers are required to pay income tax in advance if their net tax liability during the financial year is expected to be 10, 000 rupees or likely to exceed 10, 000 rupees per year. Paying it in advance i.e. before the actual liability arises, is called advance tax. Which means, every taxpayer is required to pay tax in advance instead of paying it at the time of filing … [Read more...] about Advance Tax Payment Due dates and Interest provisions for non payment
Common reason of higher Income Tax Deduction
Their can be reasons where TDS from your source of income will exceed the actual tax to be deducted as per the provisions applicable to you. Followings are some of the these situations where such things may happen; Non submission of Investment proof to employer At the beginning of the year, most of the employees will declare their investments to get less IT deduction. At … [Read more...] about Common reason of higher Income Tax Deduction