Direct & Indirect Taxes, Tax Ready Reckoner, Tax Management, Tax Act. & Rules, Tax Planning & Tax Savings.

Direct & Indirect Taxes, Tax Ready Reckoner, Tax Management, Tax Act. & Rules, Tax Planning & Tax Savings.

Income Tax Basic

Income Tax Basic and Fundamentals

Person [Section 2(31)] – Under Income Tax Act.

Under Section 2(31), A ‘Person’ is An Association Of Persons (AOP) or a Body Of Individuals (BOI) or a Local Authority or an Artificial Juridical Person, whether or not, such Person or Body or Authority or Juridical Person, was formed or  established or incorporated with the object of deriving income, profits or gains. In other …

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In which Cases Income of Previous Year is Assessed in the Same Year

As a normal rule, the income earned  during any previous year is assessed or charged to tax in the immediately succeeding assessment year. However,  in the following circumstances the income is taxed in the same year in which it is earned. Therefore, the  assessment year and the previous year in these exceptional circumstances will be …

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[Section 2(24)] – ‘Income’ Under Income Tax Act.– Concept & Definition

The word ‘Income’ covers receipts in the shape of money or  money’s worth which arise with certain regularity or expected regularity from a definite source. However, all  receipts do not form the basis of taxation under the Act. Broadly, an analogy is drawn of a tree and the fruits of  that tree. The tree symbolises …

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‘Residential Status’ under Income Tax Act. 1956

1.   Residential Status of an Individual [Section 6(1)] According to the residential status, the assessee can either be: (i) Resident in India; or (ii) Non-Resident in India. However, individual and HUF cannot be simply called resident in India. If individual is a resident in India he  will be either: (a) Resident and Ordinarily resident in …

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Rates for TDS ( Deduction of Tax at Source) in case of a Person other than a Company for Financial Year 2020-21 (Assessment Year 2021-22)

1.   Rates of TDS Where the Person is Resident in India Rates of TDS 1 on income by way of interest other than “Interest on securities” 10% 2 on income by way of winnings from lotteries, crossword puzzles, card  games and other games of any sort 30% 3 on income by way of winnings from …

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Rates for TDS ( Deduction of Tax at Source) in case of a Company for Financial Year 2020-21 (Assessment Year 2021-22)

1.   Rates of TDS in case of Domestic Company Rates of TDS 1 On income by way of interest other than “Interest on Securities” 10% 2 on income by way of winnings from lotteries, crossword puzzles, card  games and other games of any sort 30% 3 on income by way of winnings from horse races …

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Rates for TDS ( Deduction of Tax at Source) given under Income Tax Act. for Financial Year 2020-21 (AY:2021-22)

Rates of TDS 1 192A — Payment of accumulated balance due to an employee  participating in a recognised provident fund 10% 2 194 — Payment of dividend by a Domestic Company 10% 3 194C — Payment to Contractor/Sub-contractor 1% where payment  made to individual/HUF.  2% in other cases 4 194DA Payment made to a resident …

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Limitation / Compliance by Assessee , Assessing Authority, etc. Under Income Tax Act, 1961

1.   Advance Tax Advance Tax  All assessees other than covered under section  44AD or 44ADA Section Nature of Compliance by Assessee, Assessing Authority, etc. Limitation 211(1) Payment of advance income-tax in specified  instalments: (i) 15% On or before 15th June of the  relevant Financial Year (ii) 45% – already paid on or before 15th June …

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Prescribed Audit Reports under the Income-Tax Rules/Act

Relevant Rule of IT Rules Relevant section of IT Act Prescribed Audit Report Relevant Form No.. if any 5AC 33AB(2) Audit report in case of Tea / Coffee / Rubber Development Account 3AC 5AD 33ABA(2) Audit report in case of Site Restoration Fund 3AD 6(7)(e) 35(2AA) Audit of accounts annually maintained separately for each approved …

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