Income from other sources3A 18 and 31

INCOME TAX You earn it & The Government takes a part (a big part) of it

Sources of Income ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

You are going to be taxed anyways …………. So grin and bear it!! We could pay taxes with a smile, but normally CA$H is required!!

INCOME The definition of the term “Income” in Sec. 2(24) is inclusive and not exhaustive It may be broadly defined as the true increase in the amount of wealth which comes to a person during a fixed period of time ,[object Object],[object Object]

GROSS TOTAL INCOME As per Section 14, income of a person is computed under the following heads: ,[object Object],[object Object],[object Object],[object Object],[object Object]

A source of income which does not specifically fall under any one of the other four heads of income is to be computed and brought to charge under the head: “ Income from Other Sources”. Sec. 56(1)

Section 56(2) enacts that in particular and without prejudice to the generality of the provisions of sub section (1), the following incomes shall be chargeable under the head Income from Other Sources. ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Conditions ,[object Object],[object Object],[object Object],Examples : ,[object Object],[object Object],[object Object],[object Object],[object Object]

Income to also include any sum of money (i.e., gift) exceeding the specified amount received by an individual / HUF, if it exceeds Rs. 50,000, but will not apply to a sum of money received from: ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

In other words……………. you just can’t escape being T - axed

BUT…… all is not lost! You do get some deductions (Section 57) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

[object Object],[object Object],Any other expenditure (not being in the nature capital expenditure) laid out or expended wholly or exclusively for the purposes of making or earning such income. [ Section 57(iii)]

Method of Accounting & Tax MERCANTILE CASH SYSTEM Due Basis On receipt/payment basis

Dividend Any dividend declared, distributed or paid by a company to its shareholders is chargeable under this head. Includes any distribution of: ,[object Object],[object Object],[object Object],[object Object],[object Object],Dividend from domestic Company EXEMPT

from lotteries, crossword puzzles, horse races, card games, gambling or betting Winnings Under Sec. 56(2)(ib), amount taxable is WINNINGS “ Lottery” includes winnings from prizes awarded to any person by draw of lots or by chance. Also includes game shows, entertainment programs on TV or electronic mode

Interest on Securities ,[object Object],[object Object],Section 56(2)(id)

Interest exempt from tax Interest on the following is exempt from tax: Notified securities, bonds or certificates. 7 % Capital Investment Bonds Interest received by a NRI from Notified Bonds Interest payable to any foreign bank performing central banking functions outside India Gold Deposit Bonds

Receipts without consideration to be treated as income: Following conditions are to be satisfied U/S 56(2)(vi): ,[object Object],[object Object],[object Object]

Permissible Deductions ,[object Object],[object Object],[object Object],[object Object],[object Object]

The Income Tax Department is “trying” to make “easier” for the tax payer!!

They are also trying to improve their “image”

Specific Disallowances U/S 58: ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

YOUR INCOME WHEN YOU EARNED IT THE TAX MAN WHAT YOU ARE LEFT WITH

Be a responsible citizen and pay your taxes on time (for listening) [email_address] Contact me on: GOD-HELP-US (463- 4357-87) Christopher Rodricks - 05A018 | Neville Unvalla – 05A031

Income from other sources3A 18 and 31

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