Taxation I

Introduction: Definitions- Assessee, Assessment Year, Income, Person, Previous Year, Gross Total Income. Scope of Total Income & Residential Status. Income which do not form part of Total Income.

Income under the Head “Salaries”: Basis of charge,Deductions from Salaries, Deduction on Account of Entertainment Allowance, Employment Tax, Inclusive definition of Perquisite Treatment of Medical Facilities, Profits in Lieu of Salary, Treatment of Leave Travel Concession, Gratuity, Commuted Pension, Retrenchment Compensation, Compensation received on Voluntary Retirement, House Rent Allowance and notified special allowances Deduction in Respect of Life           Insurance premium, Contribution to Provident Fund etc. Relief when salary is paid in arrears or in advance, etc. Valuation of Perquisites: Rent Free Accommodation, Monetary obligation of employee discharged by employer Life Insurance Premium etc. payable by employer, Fringe benefits or amenity: Motor Car, Services of Sweeper etc. Supply of gas, electricity or water, Educational Facilities

Computation of Taxable Income under the head House Property: Chargeability and Basis of charge, Computation of Annual Value Treatment of Unrealized Rent, Computation of Income of a self occupied and let out house Property, Deductions from Income from House Property, Treatment of Unrealized Rent realized, subsequently, Treatment of arrears of rent received, Property owned by co-owners, Deemed ownership

Income under the Head “Profits and Gains of Business or Profession” : Scope of Income under this head Rent, rates, taxes, repair and insurance for buildings Repair and insurance of Plant, Machinery and Furniture, Depreciation: Treatment of unabsorbed depreciation, Tea Development Account/Coffee Development Account and Rubber Development Account, Site Restoration Fund                          Expenditure on Scientific Research, Weighted Deduction on in-house research and development to Company assesse, Expenditure for  obtaining  license  to  operate  tele-communication services                                                                   Expenditure on eligible projects or schemes, Deduction in respect of expenditure on specified business, Expenditure  by  way  of  payment  to  association  and institutions for rural development programme, Weighted deduction on agricultural extension project and skill development project, Amortization of preliminary expenses, amortization in case of amalgamation or demerger                                      Deductions under section 36 of Income Tax Act,1961, General Deductions under section 37, Provisions of section 44A, 44AA, 44AB, 44AD, 44AE, 44B, 44BB, Undisclosed  Income/Investments  under  section 68,  69, 69A, 69B,69C

Income under the Head “Capital Gains”: Meaning of Capital Gain and Basis of charge (Section 45 and sub sections) Capital Gain on distribution of assets by companies on liquidation (section 46), Transactions not regarded as transfers, Computation of Capital Gains (section 48), Deemed cost of acquisition (section 48), Computation of capital gain in case of depreciable assets (section 50) Provisions of section 51, 54, 54B, 54D, 54EC, 54F, 54G, 54GA, 54GB, 54H, Cost of improvement and cost of acquisition, Provisions of section 111A, 112, 115F, 115I.