Income Tax Act 1961

Asst.Prof.Mokal S.RACS College Narayangaon, Pune.Mail ID – sushantmokal2015@gmail.comMob. No. 9604352195

Syllabus -

Income Tax Act, 1961

• Meaning & Scope –

• Direct Taxes & Indirect Taxes

Section 3 – Previous Year Preceeding year

Period Less/Equal/More than Twelve months

Ended on 31st March every year

Revenue, Earning,Financial, Accounting

Section 2 (9) Assessment Year Succeeding Year

Twelve months

Commencing on 1st April every year

Tax year, Government Year

Section 2 (31) Person An Individual A HUF A Company A Firm An AOP/ BOI A Local Authority Artificial Judicial Person

Section 2(7) Assessee

A person from whom any tax or any other sum is payable;

And includes Every person in respect of whom any proceedings

under this Act has been taken for assessment of his income/loss/refund

Deemed assessee Deemed to be assessee in default

Section 2 (24) Income Profits and Gains Dividend Voluntary Contributions by a trust Perquisite/Profit in lieu of Salary Special Allowance Allowance to meet personal expenses Benefit or perquisite convertible into money or

not Capital Gains Winnings from lotteries/crossword

puzzles/races/other games

Sec. 6 Residential Status Types of Status –

Resident - Non Resident Conditions –

Basic Conditions – ( Any One ) 182 days or more or 60 days and 365/4 preceding previous year

Additional Conditions – ( Both ) 730 days out of 7 preceding previous years 2 out of 10 preceding previous year

Section 9 – Tax Incidence Income Due & Accrued in India

Income Due & Accrued outside India

Income Due in India but received outside India.

Income Due outside India but received in India

Sec.10 – Exempted Incomes Agricultural income; Receipts by a member from HUF. Share of profit from partnership firm Allowances & perquisites outside India. Death cum retirement gratuity. Any payment in commutation of pension Leave encashment Compensation on retrenchment Amount received on Voluntary retirement. Amount received on life insurance policy. Providend Fund. Payment from approved supperannuation Fund.

Exempted Incomes cont… House Rent Allowance, Notified Special Allowances, Interest on Govt. Securities, Educational Scholarship, Daily & Constituency allowance rec. to MPs and MLAs . Awards & Rewards. Income of Local Authority/Specified News agency/

Professional Bodies/Educational institutions/Trade Union Income of Notified Mutual Funds Income of Minor Childs. Capital Gain on units of Unit Scheme 64. Dividend in the hands of shareholder.

Sec. 14 - Heads of Income Income From Salary Income From House Property Income From Business / Profession Capital Gain Income From Other Sources

Income From Salary ….

Provisions – Sec. 15 to 21 Chargeability & Conditions Basic Dearness Allowance Commission Allowances Perquisites Deductions – • Standard Deductions - NIL• Entertainment Allowances – Only Govt. Emp• Profession Tax - Actual payment

Income From House Property … Provisions – Sec. 22 to 27 Chargeability & Conditions Types of House Property Annual Value Municipal Tax Deductions –

• Standard Deduction – 30% of NAV• Interest on Housing Loan – Rs. 200000/Actual

Income From Business / Profession ..

Provisions – Sec. 28 to 44 Business, Profession, Vocation Allowable Expenses Disallowable Expenses Deemed Income

Capital Gain …..

Provisions – Sec. 45 to 54 Chargeability & Conditions Transfer Types of Capital Assets & Capital Gain• Short Term Assets – S.T.C.Gain• Long Term Assets - L.T.C.Gain

Deductions U/s. 54 Taxability

Income From Other Sources …..

Provisions – Sec. 55 to 57 Chargeability Dividend, Interest, Family Pension Speculation Business income Allowable Expenses

Deductions Under Chapter VIA …..

Conditions – Paid during the financial year 80C – Investments – Rs. 1,50,000/- 80CCC – Investment in Pension Fund 80D – Mediclaim insurance Premium – 25000/30000 80DD - Medical treatment to handicapped Dependant –75/125 80DDB – Medical Treatment – 60,000/ 80,000. 80E – Interest on Loan taken for Higher Education – 8 years 80 G – Donations 80GG – Rent Paid 80IA - Profits from industrial undertaking – 100% for 5 years 80QQB – Royalty income of Authors – 100% or Rs. 3,00,000/- 80RRB – Royalty on patents - 100% or Rs. 3,00,000/- 80TTA – Interest on Saving Accounts 80U – Person totally blind or Physically handicapped – 50/100

Rates of Income Tax (F.Y 2015-16) Normal

Up to Rs. 250000

Rs. 250000-500000

Rs. 500001-1000000

Income exceeds Rs. 1000000

Nil 10 % of the amt in

excess of Rs. 250000 Rs. 25000+20% of

the amt in excess of Rs. 500000 Rs. 125000+ 30 % of

the amt in excess of Rs. 1000000

Rates of Income Tax (F.Y 2015-16) Senior Citizen ( Age 60 To 80 )

Up to Rs. 300000

Rs. 300000-500000

Rs. 500001-1000000

Income exceeds Rs. 1000000

Nil 10 % of the amt in

excess of Rs. 300000 Rs. 20000+20% of

the amt in excess of Rs. 500000 Rs. 120000+ 30 % of

the amt in excess of Rs. 1000000

Rates of Income Tax (F.Y 2015-16) Most Senior Citizen ( Age more than 80 Years )

Up to Rs. 500000 Rs. 500001-

1000000

Income exceeds Rs. 1000000

Nil

20 % of the amt in excess of Rs. 500000

Rs. 100000+30% of the amt in excess of

Rs. 1000000

Procedural Parts – Sec. 139

Income Tax Returns • Voluntary Return• Return of Loss• Belated Return• Revised Return• Defective / Incomplete Return

Forms of I.Tax Returns• ITR – 1• ITR – 2• ITR – 3• ITR – 4

Due Dates for Filing• 31st July• 30th Sept.

• ITR – 5• ITR – 6• ITR – 7• ITR - 8• ITR - V

Types of Assessement

Self Assessment – 140A Summary Assessment – 143 (1) Assessment in response to notice - 143 Best Judgment Assessment – Sec. 144 Dispute Resolution Panel - Sec. 144C Reassessment - Sec. 147 to 151

Defaults & Penalties Interest -

• U/s. 234A – Defaults in furnishing return of income• U/s. 234B – Defaults in payment of advance tax• U/s. 234C – Deferment of Adv. Tax• U/s. 220(2) – Making late payment of income tax• U/s. 234D – Interest on excess refund granted • U/s. 244A - Interest payable to assessee

Penalties –• U/s. 140A• U/s. 271• U/s. 272

Income Tax Authorities The Central Board of Direct Taxes Director General of Income Tax or

Chief Commissioners of Income Tax Directors of Income Tax or

Commissioners of Income Tax Commissioners of Income Tax ( Appeal ) Add. Dir.of I.Tax, Add. Comm.Of I.Tax,( App). Joint Directors/Commissioners of Income Tax. Deputy Directors/Commissioner/Com. ( App. ) Asst. Directors, Asst. Comm. Of Income Tax Income Tax Officers Tax Recovery Officers Inspectors of Income Tax

Imp.Tips…. Tax Planning Tax Evasion Tax Avoidance Tax Management

Critical Decesions…. Make or buy Run or Shut Down Own or Lease Domestic or Export Contract or continue Invest or Disinvest

Assessment of Partnership Firms…. Meaning & Objectives Conditions

• Fulfillment of Conditions U/s. 184 Firm must be evidence by an instruments Individual share of partner must be specified Certified copy of the instrument should be submited. Revised instrument There should not be any failure as mention

• Allowable Remuneration – Sec. 40 ( b )• Interest to partners - Sec. 40 ( b )

Income Tax Rate – Flat rate 30%

Thank you…..