Subu Capital Gains Final

8/13/2019 Subu Capital Gains Final

1/23

CHRIST COLLEGE, JAGDALPUR

SUBRAMANI

Profits or gains arising from t

CHARGEABILITY

Any profits or Gains arising f

Chargeable to Tax under this

That is to Say:-

There Should be a Capital As

Capital Assets should be transProfit/Gains should have arise

Such Profit/Gains should be li

INCO

M.C, M.Com , L.L.B. Head Of Commerce

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Capital gains

ansfer of any asset

om the transfer of a Capital Asset during the

ead of income.

et

ferred during the previous year.n.

able for tax.

E TAX NOTES 2006-07

Dept1

previous year is


2/23


SUBRAMANI

INCO


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Dept2


3/23


SUBRAMANI

INCO



Dept3


4/23


SUBRAMANI

INCO



Dept4


5/23


SUBRAMANI

TAX LIABILITY

SHORT TERM CAPITAL G

To determine the Value of Co

To deduct expenditure incurre

To deduct the cost of acquisiti

To deduct cost of improveme

To avail exemption u/s 54 B,

The balance amount is Short

Short Term Capital Gains are

LONG TERM CAPITAL GA

To determine the Value of Co

To deduct expenditure incurre

To deduct indexed cost of acqTo deduct indexed cost of im

To avail exemption u/s 54, 54

The balance amount is Long

Long Term Capital Gains are

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INS

nsideration

d for the transfer

on.

t.

4 D, 54 G, and 54 GA.

erm Capital Gains.

chargeable to Tax based on SLAB RATES.

INS

nsideration

d for the transfer.

uisitionrovement.

B,54 D, 54 EC, 54F, 54 G, 54 GA,

erm Capital Gains.

chargeable to Tax on Flat Rate i.e 20%

E TAX NOTES 2006-07

Dept5


6/23


SUBRAMANI

Judicial points on what is tax

Personal effects should be mo

be Jewellary, archaeological c

Gold and Silver coins and bar

not personal effects. Therefor

Furniture's are of personal use

Foreign Stamp collections not

Car, Scooter etc., are under p

Securities, Loose diamonds,

Long term capital Gain => 20

While calculating Tax liabilit

capital gains.

Slab rates 5000

50000 to 6000

60000 to 1500

above 150000

Long term capital gain is char

rate of 10% is charged for lon

Long term

(which remainmonths)

Furniturenot asset

Urban land Munici

Situated in local limit of muni

Intangible asset Goodwill,

Computation of long term ca

Full value of consideration

Less:-

Expenditures incurred

Exclusively in connec

Such a transfer

(like Brokerage and ot

Less :- i) Indexed cost of acq ii) Indexed cost of im

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ble and what is not taxable.

vable property, it should be held for personal

ollections, drawings, paintings, sculptures, o

s used for pooja of deities as a matter of prid

taxable.

. Therefore not taxable.

a personal effect. Therefore taxable.

rsonal effects. Therefore exempted.

oats are not personal effects. Therefore taxa

% taxed

using slab rates, we dont take into conside

- nil

- 10%

0 - 20%

- 30%

ged at the flat rate of 20% . But a person wh

g term capital gain

Capital Gain

capital gain Short t

for more than 36 months) (which rem

of personal nature Business furniture is take

al contominent Board and having populatio

cipality or Contominent Board

patents, copyrights, Jewelry even personal.

ital gains

wholly and

ion with

her selling exp) xx xx

Net sale consideration xxx

isition xxrovement xx xx

Long term capital gain xxx

E TAX NOTES 2006-07

Dept6

use and it should not

r any work of art.

or ornamentation are

l

ation Long term

is non-resident, a flat

rm capital gain

ains less than 36

as asset

more than 10000


7/23


SUBRAMANI

Less :- Exception u/s 54/ 54

From as year 1988 89 , equi

assets, if they are held by an a

preceding to the

Date of sale or transfer.

From as year 95-96 various seUTI and other specified mutu

for less than 12 months.

Capital assets means property

tangible or intangible, like lan

securities, furniture, machiner

Exceptions :- (It does not incl

1. Stock in trade

2. Personal effects excludin3. Agricultural land in rural a

4. Gold Bonds 61/2

% of gol

7% gold bo

National De

5. Special Bearer bond 1991

6. Gold deposit bond 1999

Computation of short term ca

Full value consideration

Less:- Expenditure incurred

xxx

(like brokerage and ot

xx

xxx

Less:- Cost of acquisition

Cost of improvement

Short term capital gai

Less:- Exception u/s 54B/ 54

Taxable short term capital Ga

1. If the asset is purchased by

Indexed cost = Original co

Index)/100

2. If the asset is purchased by

Indexed cost = Original c

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/ 54D/ 54EC/ 54ED/ 54F/ 54G xx

Taxable LTCG xxx

ty share and preference shares will be treated

ssessee for not more then 1 year (12 months)

curities listed in a recognized stock exchangl funds are considered as short term capital

of any kind whether fixed or circulating, mo

d building plot, gold, silver, precious metals,

y etc.

de in assets)

jewelryea

bonds 1977

ds 1980

ense Gold bonds 1980 issued by central gov

Issued by Central govt

Issued by Central govt

ital gain

holly and exclusively in connection with su

er setting exp)

Net sale Consi

xx

xx xx

xxx

/ 54G xx

in xxx

Indexed cost of acquisition

the assessee before 01-04-81

st or Fmv on 01-04-81(whichever is more) X

the assessee after 01-04-81

ost or Fmv on 01-04-81(whichever is more)

(previous year Index)/(Index

E TAX NOTES 2006-07

Dept7

as short term capital

immediately

in India like units ofssets if they are held

vable or immovable,

Jewelry, shares,

t.

h a transfer

xx

erable

previous year

f purchased year)


8/23


SUBRAMANI

3. If the asset is acquired fro

this asset before 01-04-81

Indexed cost = Original co

Index)/100


this asset before 01-04-81



this asset after 01-04-81


Note:- Case 3, 4 & 5 are appli

gift or inheritance.

Case 1 :- If expense are incur

No need of Indexation

Cost of improvement

Case 2 :- If expense are incur

Indexed cost of = Cost

Note:- For calculating Indexe

1. For other than debentures aacquisition and Indexed cost

(Cost of acquisition & cost of

2. If the assets are used by the

Even if the holding is

treated as short term capital g

calculated.

Ex:- If machinery and buildin

Exemption under section 54

Page 272

Securities exempted from tax

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the previous owner before 01-04-81 and pre

st or Fmv on 01-04-81(whichever is more) X

the previous owner after 01-04-81 and prev


(previous year Index)/(Indexthe previous owner after 01-04-81 and prev


(previous year Index)/(Index

cable where the transferred asset is acquired

Indexed cost of improvement

ed before 01-04-81

= NIL

ed after 01-04-81

f improvement X (previous year Index)/(Ind

in whi

cost of acquisition

nd bonds for all other long term capital assetf improvement are to be calculated.

improvement are to be deducted, but not ind

assessee in the business which are subject t

ore than 3 years the gain on transfer of suc

in ie for these assets indexed cost of acquisi

g is used the assessee for business then it is n

Capter 5

Income from other sources

Securities

Tax-free securities

E TAX NOTES 2006-07

Dept8

vious owner required

previous year

ous owner required

f purchased year)ous owner required

f purchased year)

by the assessee out of

ex of the year

h exp are incurred)

, Indexed cost of

xed)

depreciation.

h assets is always

ion is not to be

ot indexed.

Less tax securities


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SUBRAMANI

Exempt U/s 10(15)

Securities exempted from ta

Tax due on the shares

assessee will not be included i

Page 263

Tax-free Securities

This securities are issucompanies in the case of tax f

Gross Interest will be include

a) Tax free Government Sec

Gross Interest = Face value

b) Tax free Commercial Sec

Note:- Interest received by th

Interest

Net Interest = face value X R

Net Interest to Gross Interest

Case 1: - If the securities are l

Rupees 1000000

Gross Interest = Net Interest

Case 2: - If the securities are l

than

1000000

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Government Commercial

Listed in stock exchange Unliste

exchan

Govern

Commercial

Listed in stock exchan

x 10 (15)

is fully exempted from tax. As such the inter

n the total income. The government issues t

ed by the government in the case of tax freeree commercial securities.

in the total income.

urities

Rate / 100

urities

assessee is net Interest, so the same is to be

ate / 100

isted in a stock exchange and if the total taxa

100 / 89.8

isted in a stock exchange and if the total taxa

E TAX NOTES 2006-07

Dept9

d in stock

ge

ment

ge Unlisted in

stockexchan

ge

st received by the

ese securities.

Govt securities and

converted into Gross

ble income is less than

ble income is more


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SUBRAMANI


Case 3: - If the securities are

than 1000000


Case 4: - If the securities are

than 1000000


Special Note: - In the proble

These securities can al

can be two types of problems.

1. When rate of interest

Gross I

1. When interest amt rInterest received is Net Int

Case (i) For Govt and listed c

1000000

Gross I

Case (ii) For Govt and listed

1000000

Gross I

Case (iii) For unlisted comme

Gross I

Case (iv) For unlisted comme

Gross I

Note: - If the nature of securit

that the security is of Less-tax

Note: - If the interest received

to Gross interest. More than 2

Deduction u/s 571. Collection charges actual a

2. Interest on loan taken to pu

2. Any expenditure, whi

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100 / 88.78

ot listed in a stock exchange and if the total

100 / 79.6

ot listed in a stock exchange and if the total

100 / 77.56

if total taxable income is not given assume l

Less Tax securities

so be issued both by the Govt and commerci

is given (both for Govt and commercial S

nterest = Face value of security X Rate / 10

ceived is given (both for Govt & commerc

rest and the same is to be converted into Gr

mmercial Securities and if the total income

nterest = Net Interest X 100 / 89.8

ommercial securities and if the total income


rcial securities income less than Rs 1000000


rcial Securities income more than Rs 100000


y is not mentioned in the problem then the g

unlisted and total taxable income is less tha

amt is Rs 2500 or less than Rs 2500 then int

500 Rs, interest received is Net Interest, so it

t spend allowed.

rchase the securities.

h is incurred on assessee to earn such incom

E TAX NOTES 2006-07

Dept10

taxable income is less

taxable income is more

ess than Rs 1000000

al authorities. There

curities)

ial)

ss Interest.

is less than Rs

is more than Rs

0

neral assumption is

Rs 1000000

erest received is equal

is to be grossed up

.


11/23


SUBRAMANI

Note: - Commission paid to p

Important points

1. Dividend on shares:

a. Dividend from

b. Dividend from

a. Dividend from1. Interest on bank depos

a. Up to Rs 5,000

b. More than Rs. 5,00

3. Cooperative Interest an

4. Interest on companya) Interest on compan

a. Up to Rs 5,000

b. More than Rs. 5,00

5. Lotterya) If the price amb) If Net amt is gi

Gross amt = N

Gross Amt= N

6. Horse race Income

7. Casual Income -

8. Royalty, Directors fee,

Expenses

9. Family Pension

10. Income from sub tena

Net Income -

11. Income from machinery

Taxable = Rent recurr

12. Agriculture Income outs

13. Income from Non-Agric

.

14. Salary of N.P or MLA

15. Income from undisclose

16. Income of Cricketers.

a. Test matches in Indi

b. Other matches in In

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urchase or to sell the securities will not be al

Domestic Company Exempt

units of UTI - Exempt

Non-Domestic Company or cooperative Soc

it

- Taxable as it is

- More than 5000 & given net then, Gr

Dividend - taxable as it is

eposits or Firms deposit

deposits or firm deposit:

- Taxable as it is

- More than 5000 & given net t

Gross = Int X 100/79.6

is given - fully taxable

ven

t amt X 100 / 69.4 (Less than 1000000)

t amt x 100/ 66.34 (more than 1000000)

- Fully taxable

Fully taxable

Articles & Income, Exam, Remuneration

Re

Taxable = Received amt 1/3 whichever i

Or Rs 15000

t

taxable

, plant and furniture on hire: -

d Expenses and depreciation

ide India - taxable

ultural Taxable land in India

- Taxable

sources (unexplained money) -

a 25% of remuneration received by the pl

control board for playing test matche

ia Entire amt not taxable.

E TAX NOTES 2006-07

Dept11

owed as deduction.

iety Taxable

oss = Int X 100/79.6

hen,

Taxable =

eived Income

less

Taxable

ayer from the cricket

s in India is taxable.


12/23


SUBRAMANI

17. Income of minor:

a. Income of minor sh

b. Exemption of Rs 15

c. If minor earns inco

income of his parents.

Comp

under the i

Particu

Interest on tax

Interest on tax

Interest on tax

Interest on Les

Interest on Les

Interest on Les

Less: - Deduct

Collect

Interest

to purc

Clubbin

Clubbing Income Sec (60-6

Deemed Income - Sec (66-69

Income of other perso

The following are the income

asessee :-

1. Transfer of Income without

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a. Matches outside India 50% taxable

ll be included in the income of his parents w

00 is available for every minor.

e from self-efforts then such income will no

utation of income from Interest on securities

come from other sources for the A.Y. 2006-

ars

free Govt securities

free commercial securities listed

free commercial securities Unlisted

s tax Govt securities

s tax Commercial securities Listed

s tax Commercial securities Unlisted

Gross income from Interest on securities

ion under section. 57

ion Charges **

paid on loan taken

ase the securities **

Income from Interest on securities

Chapter 6

of Income and Deemed Incomes (Sec 60-

)

)

is added in our income is known as clubbin

of other persons which are included in the t

transfer of assets (Sec 60)

E TAX NOTES 2006-07

Dept12

.

hose income is higher.

t be added to the

007

Amount

***

***

***

***

***

***

***

**

***

9)

g of Income.

otal income of the


13/23


SUBRAMANIAM

The income from a house or a building

head is taxed on the basis of notional i

Important points to be considered The legal owner is liable to p Deemed owner is liable to pa

a. Person transferrinb. Person transferrinc. Karta in the Hindud. Member of a housi

Where the ownership is in disbe assessed (subject to the Co

If the house is mortgaged, the In the case of leased lands, if

purposes.

In the case of a partnership, ifthe partners.

If the building is let out to theas Business Incme and expen

Where the tenant has sublet tproperty It is taxable under th

Rent of the land and rent froIncome from other sources.

Composite Rent (Rent of thetwo parts.

a. Rent of the houseb. Other rents (incom

The incomes of the followingconsidered).

a. Building, let out fb. Storage or Warehoc. Factoryd. Stallse. Bazarf. Shopg. Lecture hallh. Cinema halli. Dance hallj. Platformsk. Public Auditoriuml. Dockm. Bridge

The following incomes will na. If the house is us

INCOME

.C, M.Com , L.L.B. Head Of Commerce Dep

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NCOME FROM HOUSE PROPERTY

is taxed under the head Income from House

come (rental value of the house )but not on t

y the tax under this head.

tax like

property to spouse (with out adequate consi

property to minor child except married min

undivided Familyng co-oprative society

pute, the I.T.O. will dicide on some reasonab

urts judgment).

mortgager is liable for tax payment.ny buildings are constructed, the lessee will

the building is constructed in the name of th

employees whose stay is incidental to the buiture incurred on such house will be conside

e house, the rent received by him will not be

head income from other sources.

huts or from tents will not come under this

ouse Rent of the Funbitur Service charges e

income from house property)e from other sources)

will be taken under the head Income from h

r office or for residential or for any other pu using

t be considered as rent from house property.

d for agriculture purpose

AX NOTES 2006-07

t

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Property The income under this

he basis of actual rent received.

eration and when living togther)

r daughter

le basis and the rent receiver will

be tratd as the owner for tax

firm then the firm is liable but n

siness, rent received will be treatered as Business Expenditure.

considered as Income from house

ead. They will be considered as

c.): The rent received is split into

ouse property (only rent is to be

poses


14/23


SUBRAMANIAM

b. If the income of athe Constitution (2

c. Property income od. Properry income oe. Income from housf. Income from hous

income is taxable.

Annual Value:Income from house property is co

any property shall be the sum forIn determining the Annual Value

1. Municipal Rental Value:- Mauthority

2. Actual Rental Value :- Actuaperiod

3. Fair Rental Value :- Fair Ren4. Stardard Rent :- Standard are

LET OUT HOU

Comes under Not

Rent Control Act Re

If the owner occupies the

house shall be taken as Ni

be given if the following

i) The house is not let oii) No other benefit is derive

Special Note: When the owner of

Purpose then it is popularl

On the other hand, if the o

Profession technically it i

As self occupied house i.e

Purpose then only it is tre

Deduction for self occupied hous No deductions are allowe

Of purchase or constructi

INCOME


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ormer ruler from any one palace was exemp

6thAmendment ) Act of 1971.

a local authority.

f a registered trade union.propery held for chartible or religious purp

properry occupied for the purpose of own b

mputed based upon the annual value Accordi

which the property might reasonably be expthe following factors are to be considered

nicipal Rental Value means the rental value

l Rental Value means rent received and recei

tal Value means rent of similar accommodati

nt eans rent fixed according to the provision

HOUSE PROPERTY

E SELF OCCUPIED H

comes under Comes under N

t Control Act Rent Control Act R

Annual Value for Self occupied House

house for his residential purpose then annual

l , i.e., the income from such house is fully e

onditions are satisfied.

t during the previous year and

from thereon.a house of a house property uses the house f

y known as self occupied property.

wner uses the house for running his own bus

a self occupied house but for income tax pu

. when the owner of the house is using the h

ted as self occupied house.

u/s 24 except interest paid on money borro

n or for repairs or reconstruction of the hous

AX NOTES 2006-07

t

14

ed before the commencement of

se (Temples)

usiness or profession whose

ng to sec 23 (1) the annual value

cted to be let out from year to yea

f the house according to a

vable from the tenent for one year

on in the same stret or similar stre

s of Rent Control Act.

USE

t comes under

nt Control Act

value of such

empted. This exemption will

r his residential

iness or to carry his

pose it is not treated

use for residential

ed for the purpose

.


15/23


SUBRAMANIAM

Model 1: If the house is purchase

The deduction is last of th

a) Actual interest paid orb) Rs.30,000

Model 2: If the house is purchase

If the assessee satisfies th

Upto Rs.1,50,000.

i) The loan is taken on oii) The construction or p

Of the financial year i

iii) The lending person/iniv) Loan sanctioned amouv) Amount of interest pavi) Amount of principal a

year.vii) Outstanding principal

Note: If the assessee is unable t

Amount will be limited to

Special note: If the assessee takes

payable on the new loan qDeduction: The deduction

a) Actual interest paid or pab) Rs. 1,50,000.

Mode. 3: If the loan is taken prior

Interest on loan taken to p

period prior to purchase/cinstalments commencing

Ction is completed.Interest relating to the yea

year irrespective of the da

Special Note:

i) Interest on interest i.e.ii) If a new loan is taken

deduction (Assessee h

iii) Brokerage or commissdeduction.

If Net Municipal Rental Value isIn some cities the municip

a percentage of amount for repair

Municipal Rental value is to be c

Gross Municipal Value(-)

=Net Municipal V

Net Municipal Value*ser

=Gross Municipal

INCOME


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/ constructed ans loan is taken before 1-4-9

e following two amounts

payable

or constructed and the loan is taken after 1-

following three conditions then the deducti

r after 1-4-99 either for construction or for p

rchase process should be completed within 3

which the loan is taken.

titution has to give a certificate giving the font to purchase/construct the house.

ble for the relevant previous year to the curr

mount repaid during the previous year releva

amount.

satisfy the abouve three conditions then the

Rs. 30,000.

a new loan to repay the first borrowed amou

ualifies for deduction.is least of the following two amounts.

able.

to the completion of construction.

urchase or acquire the property or to constru

mpletion of construction will be allowd as drom previous year in which the house constr

r of completion of construction can be fully

e of completion.

penal interest is not allowed as deduction.o repay the original loan, interest paid on the

as to satisfy in this regard to assessing office

ion paid or expenses incurred to raise the loa

given:al corporation will calculate the rental value

and service taxes like sewerage and water t

lculated as under.

Allowance for repairs(-)service tax

lue

ORice taxes*allowance for repairs

Value

AX NOTES 2006-07

t

15

9.

4-99

n shall be given

rchasing the house.

years from the end

llowing details.

nt assessment year.

nt to the current assessment

maximum deduction

nt then also interest

t the house, interest paid for

eduction in five equal annual-

laimed as deduction in that

new loan will be allowed as

with the facts.)

n are not allowed as

of the property after allowing

xes etc., in such a case Gross


16/23


SUBRAMANIAM

Unrealised Rent: -The amount orent. The treatment for unrealized

(1)Unrealised rent of the relevthe unrealized rent is to be ded

following conditions

(i) Tenancy is bonafide and th

(ii) The defaulting tenant has

(iii)It is proved that the legal p

the rent.

Hint: - A.R.V= Rent per mont

2) Unrealised rent related toA) If unrealized rent was

received during the c

income from house p

B) If arrears of rent pertathe earlier period ) as

treated as income fro

received amount und

C) Arrears of rent on acurrent year for enh

If the assessee entered into

year i.e. 2003-2004 or at a

from house property A de

Deductions u/s 24:

1. Standard deduction or SThis is a compulsory dedu

expenditure incurred willvalue.

Note:- When the net annu

2. Interest on loan u/s 24 ((i) Interest on loan taken to p

house is allowed as deduc(ii) If the interest is paid in In

outside India, tax is to be

(iii) Interest on loan is allowed

previous year interest for

(iv) If interest paid for earlier

deduction in the current y

(v) Interest on loan taken to pfor period prior to purchas

annual instalments comm

INCOME


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f rent that the owner (assessee) is unable to r

rent is explained as under:

ant previous year to the current assessment y

ucted from the Actual Rental Value on satisf

e tenant is not in occupation of any other pro

acated or steps have been taken to vacate the

roceedings are useless or legal proceedings a

h x12 (-) Unrealised rent.

or prior to the Assessment year 2001-2002 deducted from actual rental value in earlier

rrent previous year then the actual amount o

operty and no deduction are allowed under s

ining to earlier previous year was not assessincome from house property then the actual

house property and standard deduction is a

r section 24

count of new agreement entered during tancing the rent from back date i.e. from tan agreement with the tenant for enhanceme

later date then in the year of receipt of arrear

uction is allowed @ 30% on the arrears amo

tatutory deduction u/s 24 (a)

ction to every assesse who is having income

not be considered. The deduction is given at

l value is nil or in negative standard deducti

)urchase or construction, repairs or renovatio

ion.ia actual interest amount is allowed as dedu

educted at source, then only it can be allow

as deduction on due basis also i.e., even if i

he previous year period can be claimed as de

eriod is not claimed as deduction, then the s

ar.

urchase or to acquire the property or to conste/completion of construction will be allowed

ncing from previous year in which the house

AX NOTES 2006-07

t

16

ecover is known as unrealized

ar.

ying the

perty of the assesse.

tenant.

re taken to recover

revious year and the same is

arrears received is treated as

c 23 and 24

d ( not shown sa income inmount received shall be

lowed at 30% on the arrears

e previous year relevant toe period earlier to 1-4-2001nt of the rent during previous

s it will be treated as income

unt received

from house letout. Actual

flat rate of 30% on net annual

n is not allowed as deduction.

reconstruction of the

tion. And if the interest is paid

d as deduction.

terest is not paid during the

duction.

ame cannot be claimed as

ruct the house, interest paidas deduction in five equal

construction is completed.


17/23


SUBRAMANIAM

Prior to construct

ending on earlier of the fo

(a)March 31 immediatel(b)Date of repayment of l

(vi) Interest relating to the yea

that year irrespective of th

(vii) Interest on interest i.e. pe

loan is taken to repay the origi

allowed as deduction (Ass

facts.)

(ix) Brokerage or commission

Special Note:-From the assesscharges, ground rent, Land rev

Municipal taxes: Actual amouValue.

(i) If Municipal taxes are d(ii) Arrears of Municipal ta

deducted from gross an

Municipal taxes paid by the tenan

WsuEd2

le

Income A/

INCOME


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ion periodmeans the period commencing on

llowing two dates

prior to the date of completion of constructi

oan,r of completion of construction can be fully

e date of completion.

al interest is not allowed as deduction.

al loan, interest paid on the new loan will be

essee has to satisfy in this regard to assessin

paid or expenses incurred to raise the loan arment year 2002-03 onwards expenses paid f

nue, insurance premium etc., will not be all

t paid by the assesse is to be deducted from

e but not paid is not to be deducted from gr

es paid in the relevant previous year to the c

ual value.

t is not to be deducted from gross annual val

RATES OF TDS DURING 2005-06

Individual, HUF, AOP,BOI Comp

Firms

en there is nocharge.

ucation cessof tax

s than 8,50,000

Where there issurcharge @

10%+

Education cess2% of tax

morethan8,50,000

Whencharg

chargsurch

tax +cess 2

2006-2007 A/Y 2006-2007 A/Y 2

AX NOTES 2006-07

t

17

the date of borrowing and

on/date of acquisition

laimed as deduction in

(viii)If a new

officer with the

e not allowed as deduction.r repaires, collection

wed as deduction.

ross annual

ss annual value.

rrent assessment year is to be

e. kkl

any and

(PFAF)

there is sur-e[rate of sur-

[Rate ofrge 2.5% of

ducation% of tax

006-2007


18/23


SUBRAMANIAM

INCOM

Incomes u/s 56(1) Incomes u/s 56

(2)

a) Dividend on sharesreferred to u/s 115-O

b) Interest on unite ofU.T.I. AND Mutual

Funds

c) Bank Interest (ifamount of interest

exceeds Rs.5000)

d) Interest on securitiesissued by:

Central or State Govt.

Local authority or

statutory corporation

Listed securities

Unlisted securitiese) Winnings from

Lotteries, Races,Puzzles, Card games,

TV game shows.

NI

NI

10.

NI

10.

10.

20.

30.

INCOME


`

E FROM OTHER SOURCES- IN NUTS

Expenses u/s 57 Exempted

incomes

N

2%

2%

2%

4%

6%

NIL

NIL

11.22%

NIL

11.22%

11.22%

22.44%

33.66%

NIL

NIL

10.45

NIL

10.45

10.45

20.91

31.36

AX NOTES 2006-07

t

18

ELL

TDS

%

%

%

%


19/23


SUBRAMANIAM

1.Agriculturalincome from

outside India.

2.Receipt fromperson other

than

employer.

3. Income fromsubletting orrent of vacant

land.

4.Directorsfee/sitting fee.

5.Remunerationfor deliveringlectures or

writingarticles.

6.Withdrawalfrom NSS u/s

80CCA-

principal

amount *

interest.

7.Repurchase ofunits u/s80CCB-

principal

amount.

8.Casualincomes other

than those

taxable u/s

65(2)9.All types of

interests

except taxableu/s 56(2).

1.Dividentfrom foreig

companies

or a co-

operative

society.

2.Interest onsecurities.

3.Winningsfrom

lotteries,

races,

crossword

puxxles,

card games,gambling

T.V. Gameshares and

betting.

4.Any amountreceived as

gift on or

after 1-9

2004 which

is not

exemptedu/s 56(v).

5.Income fromletting of

plant andmachinery

where it is

not regular

business.6.Income from

letting of

building,along with

furniture

and plant

andmachinery

and rent is

inseparable.

7.Any amountdeducted b

INCOME


`

A. Nodeduction of

any

expenditure out

of casual

incomes, races,

puzzles etc. u/s

56(2).

B. BankCommission,

Collection

charges.

2.Interest onloan taken

to acquirean asset

whoseincome is

taxable

under this

head.

3.Std.deduction

@ 1/3 of

family

pension orRs. 15,000

whichever is

less.

4.Depreciationand

expenses,

fire insur-

ancepremium,

local taxes

etc. relatingto let out

period.

5.Amount paidby employerto provi-

dent fund or

ESI

authorities

by

Rates of TES fIndividual, HUAOP [surcharge]Interest on

securities issued

by local authority

or statutory

bodies

10.2%

Listed debentures

of a company-

10.2%

Unlisteddebentures-

20..4%

Bank Interest

10.2%

Casual Incomes

30.6%

[With surchargetotal incoexceeds

Rs.8,50,000]Interest on securiti

issued by loc

authority or statuto

Bodies-11.22%

Listed debentures

a compan

11.22%Unlisted

debentures-

22.44%Bank intere

11.22%

Casual

Income-33.66%

1.2.

3.

4.

5.

6.

7.

8.

AX NOTES 2006-07

t

19

Interest on Govt.securities.

Deemed

dividend u/s

2(22)(c)

Interest on any

security notified

u/s 193.

Interest paid toan individual in

A/c payee

cheque for an

amount not

exceeding Rs.

2,500 by certaincompanies.

Bank interestcredited or paid

upto Rs.2,500

Race winning if

it is upto

Rs.2,500.

Winning from

lotteries, card

games and

puzzle amountif not more than

Rs. 5,000.

In case of

gambling andbetting etc.


20/23


SUBRAMANIAM

employerout of

employees

salary as

their

contributio

towards

provident

fund or ESIfund.

.va ue o any s are or e entures g v

at concessional rate to employees unde

scheme approved by the central Govt.

21.Free ticket given by railways & air t

employer to their employees.

INCOME


`

appropriatedate.

6.Any otherexpen-diture

which is not

a personal

or a capital

expenditure

and isincurred to

earn an

income

taxable

under this

head.

n ree o cost or

stock option

ansport

AX NOTES 2006-07

t

20


21/23


SUBRAMANIAM

INCOME


`

AX NOTES 2006-07

t

21


22/23


SUBRAMANIAM

1.Free medical facilities as given u/s17(2)

2.Free refreshment during working

hours

3.Free recreational facilities

4.Provition of telephone whether basi

or cellular

5.Free meals provided in remote area

at offshore installation are fullyexempted.But if given at any other place during

working hours it shall be exempted if

cost does not exceed Rs 50 per meal.

6.Free education, training or refresher

course for employees

7.Goods sold at concessional rates.

8.Free ration received by members ofarmed forces.

9.Value of gifts up to Rs 5,000 in

aggregate in a previous year.

10. allowed by Govt. to its employees

posted abroad.

11.Rent free house given to an officer

of parliament, a union minister, &

leader of opposition in parliament12.Conveyance facilities to judges ofsupreme court and high court

13.Free conveyance provided by

employer to employees for going to o

coming from place of employment.

14.Any amount contributed by

employer towards pension or deferred

annuity scheme.

15.Employers contribution to staffgroup insurance scheme

16.Computers, laptops given to an

employee for official use

17.Transfer of a moveable asset morethan 10 years old without consideratio

18.Accident insurance premium paid

employer for his own benefits

19Interest free loan or loan atconcesional rate of interest taken byemployee from employer if amount o

loan does not exceed Rs 20,000 or loa

is taken for medical treatment

20.value of any share or debentures

given free of cost or at concessional r

to employees under stock optionscheme approved by the central Govt.21.Free ticket given by railways & air

transport employer to their employees

INCOME


`

r

n

y

n

te

.

1.Rent free house.2.Concessional rent house

3.Obligation of employment by

employer

(a).Amounts paid by employer.

Club bill .

Gas and electricity bill.

Education bill of children.

Income tax of employee.Professional tax of employee.Salary of servants employed by

employee.

Car or other conveyance owned

By employee, used for private purposes

and expenses are met by employer.

Any other bill for personal expenses

issued in the name of employee paid byemployer.

4.Any other fringe benefits given by

employer to employee.

(a) Free meals if provided during

working hours & value exceeds Rs. 50

per meals

(b) Gifts exceeding Rs.5000 in p/y

(c) Club facility actual expenditure istaxable(d)Credit card & add on card actual fee

is taxable.

(e)Interest free loans or loan at

concessional rate of interest if more

than Rs.20,000 7 if not for medical

treatment difference between

prescribed rate & rate charged is

taxable.(f) Use of moveable assets except

computers laptops.

(g) Transfer of movable assets .

(h) Expense on tours & travels5.Any amount of life insurance

premium paid by employer during the

previous years.

AX NOTES 2006-07

t

22

1.Car owned byemployer but used by

employee both for

personal and official

purposes.

2.Gas & electricity

facility.

3.Education facility for

children.4.Free transportallowed by employer

engaged in transport

business

5.Service of domestic

servant provided by

employer

6.Any other bill forpersonal expenses of

employee paid by

employer.


23/23


SUBRAMANIAM

INCOME


`

AX NOTES 2006-07

t

23

Documents

Subu Capital Gains Final