Chargeability/Scope/Meaning of Income under the head “Profits and Gains of Business and Profession” under Section 28 to 44D has been explained with practical examples for the AY: 2022-23 & 2023-24. 1. Table showing how to compute “Profits and Gains of Business and Profession” A. Income from sources other than speculation business 1. Net […]
Section 30 to 35 covers the following expenses Allowed as Deduction while computing Profits and Gains of Business and Profession. Meaning of the term ‘paid’: Before we discuss the specific expenses, it is necessary to understand the meaning of the term ‘paid’, which will be used in relation to these expenses. According to section 43(2)
List of all Other Deductions which are specified under section 36 of the Indian Income Tax Act,1961, for computing income arising from Business and Profession. Deductions which are specified under section 36 for computing income arising from Business and Profession include the following: 1. Insurance premium of stocks [Section 36(1)(i)]: The amount of any premium
Section 36-Other Deductions -Profits and Gains of Business and Profession Read More »
Any expenditure (not being expenditure of the nature described in sections 30 to 36) and not of capital or personal expenses are allowed as deduction under section 37(1) Any expenditure (not being expenditure of the nature described in sections 30 to 36) and not being in the nature of capital expenditure or personal expenditure of
General Deductions [Section 37(1)] -Profits and Gains of Business or Profession Read More »
Notwithstanding anything contained in sections 30 to 38, the following amounts shall not be deducted under section 40(a), 40(b), 40(ba) in computing the income chargeable under the head profits and gains of business or profession. 1. Disallowance In the case of any assessee [Section 40(a)] (i) Any interest, royalty, fees for technical services, or
The provisions, which are being discussed under various sub-sections of section 40A have overriding effect over the provisions of any other section, because section 40A(1) clearly states that the provision of section 40A shall have effect notwithstanding anything to the contrary contained in any other provisions of the Act. Therefore any expenditure or allowance, though
Under Section 43B, some of the Expenses are allowed and can be claimed by the Assessee only in the year in which the payment is actually made for computing income under the head Business and Profession. Notwithstanding anything contained in any other provisions of Income-tax Act, in respect of certain expenditure/ payments, the deduction is
Income referred to in Section 68, 69A, 69B, 69C and 69D which are undisclosed income and Investments Taxed as Deemed Income of Business and Profession. 1. Cash credits [Section 68]: Where any sum is found credited in the books of an assessee, maintained for any previous year, and the assessee offers no explanation about the
What are the Deemed Profits and how they chargeable to Tax as Business Income 1. Recovery against any Allowance or Deduction Allowed earlier [(Section 4 1(1)] (A) Recovery by the same assessee (Section 41(1)(a)1: Where an allowance or deduction has been made in the assessment for any year in respect of (i) loss, (ii) expenditure
Deemed Profits Chargeable to Tax as Business Income Read More »
As per Section 44AA and Rule 6F, persons carrying on Business and Professions specified below are mandatorily required to maintain their books of accounts. 1. Person carrying on certain professions [Section 44AA(1)]: Every person, carrying on legal medical, engineering or architectural profession, or profession of accountancy or interior decoration or any other profession as is
