Beruflich Dokumente
Kultur Dokumente
Central Revenue collections in 2007-08 (Source: Compiled from reports ofComptroller and Auditor General of Indiafor relevant years) Personal income tax (direct) (17.43%) Corporate tax (direct) (32.76%) Other Taxes (direct) (2.83%) Excise duty (indirect) (20.84%) Customs duty (indirect) (17.46%) Other taxes (indirect) (8.68%)
The Central Government has been empowered by Entry 82 of the Union List of Schedule VII of the Constitution of India to levy tax on all income other than agricultural income (subject to Section 10(1)).
[1]
comprises The Income Tax Act 1961, Income Tax Rules 1962, Notifications and Circulars issued by Central Board of Direct Taxes (CBDT), Annual Finance Acts and Judicial pronouncements by Supreme Court and High Courts. The government of India imposes an income tax on taxable income of all persons including individuals, Hindu Undivided Families (HUFs), companies, firms, association of persons, body of individuals, local authority and any other artificial judicial person. Levy of tax is separate on each of the persons. The levy is governed by the Indian
Income Tax Act, 1961. The Indian Income Tax Department is governed by CBDT and is part of the Department of Revenue under the Ministry of Finance, Govt. of India. Income tax is a key source of funds that the government uses to fund its activities and serve the public. The Income Tax Department is the biggest revenue mobilizer for the Government. The total tax revenues of the Central Government increased from 1392.26 billion in 1997-98 to 5889.09 billion in 2007-08.
Contents
[hide]
[2]
o o o o
2.1 Charge to income-tax 2.2 Residential status 2.3 Residential status of a person other than an individual 2.4 Scope of total income
3 Heads of income
o o o o o
3.1 Income from salaries 3.2 Income from house property 3.3 Profits and Gains of business or profession 3.4 Income from capital gains 3.5 Income from other sources
4 Agricultural income
o o
4.1 Income partly agricultural and partly business 4.2 Scheme of partial integration of non-agricultural income with agricultural income
o o o o o o o o o
5.1 Section 80C deductions 5.2 Section 80CCC 5.3 Section 80CCD 5.4 Section 80D: Medical insurance premiums 5.5 Section 80DDB : Deduction in respect of medical treatment, etc 5.6 Section 80CCG : RGESS 5.7 Section 80E : Education loan interest 5.8 Section 80TTA : Interest on Savings Account 5.9 Section 80U : Disability
6 Due date of submission of return 7 Advance tax 8 Tax deducted at source (TDS) 9 Corporate income tax
9.1 Surcharge 1
10 Tax returns
o o o o o
10.1 Normal return 10.2 Belated return 10.3 Revised return 10.4 Defective return 10.5 Returns in response To notices
o o o
11.1 Annual information return 11.2 Statements By producers 11.3 Statements by non-resident having a liaison office in India
at the rate enacted by the Union Budget (Finance Act) for every Assessment Year, on
The chargeability is based on nature of income, i.e., whether it is revenue or capital. The rates of taxation of income are-: Income Tax Rates/Slabs Rate (%) (applicable for assessment year 2014-15)
[6]
Net income range (For resident woman below 60 years on the last day of the previous year)
Net income range Net income range Net income range (For any (For resident (For super senior other person excluding companies and senior citizen1) citizen2) co-operative societies)
Up to 200,000
Up to 250,000
Up to 500,000
Up to 200,000
NIL%
200,001500,000
250,001500,000 -
200,001500,000
10%
500,0011,000,000
500,001 1,000,000
500,001 1,000,000
500,0011,000,000
20%
Above 1,000,000
Above 1,000,000
Above 1,000,000
Above 1,000,000
30%
^1 Senior citizen is one who is 60 years or more at any time during the previous year but not more than 80 years on the last day of the previous year. ^2 Super senior citizen is one who is 80 years or more at any time during the previous year. ^3 These slab-rates aren't applicable for the incomes which are to be taxed at special rates under section 111A, 112, 115, 161, 164 and 167. For instance, long-term capital gains (except the one mentioned in section 10(38))for all assessees is taxable at 20%. For individual assessees whose total income does not exceed 500,000 before giving any deduction under Chapter VI A are eligible for a rebate of up to 2,000 under section 87A (applicable from assessment year 2014-15 onwards). A surcharge of 10% on income tax payable is applicable for every non-corporate assessee, whose total income exceeds 10 million (applicable for assessment year 2014-15).
Presence of at least 182 days in India during the previous year. Presence of at least 60 days in India during the previous year and 365 days during 4 years immediately preceding the relevant previous year.
However, in case the individual is an Indian citizen who leaves India during the previous year for the purpose of employment (or as a member of a crew of an Indian ship) or in case the individual is a person of Indian origin who comes on a visit to India during the previous year, then only the first of the above basic condition is applicable. To determine whether the resident individual is ordinarily
Resident in India in at least 2 out of 10 years immediately preceding the relevant previous year.
Presence of at least 730 days in India during 7 years immediately preceding the relevant previous year.
If the individual resident satisfies only one or none of the additional conditions, then he is not ordinarily resident. (In case the person is not an individual or an HUF, then the residential status can only be either resident or non-resident)
Type of person
HUF1
Resident
Non-resident
Resident
Firm
Resident
Non-resident
Resident
Association of persons
Resident
Non-resident
Resident
Indian company2
Resident
Resident
Resident
Foreign company3
Resident
Non-resident
Non-resident
Non-resident
Resident
^1 After determining whether an HUF is resident or non-resident, the additional conditions (as laid down for an individual) should be checked for the karta to determine whether the HUF is ordinary or not-ordinary resident. ^2 An Indian company is the one which satisfies the conditions as laid down under section 2(26) of the Act. ^3 Foreign company is the one which satisfies the conditions as laid down under section 2(23A) of the Act.
Income is not received (or not deemed to be received under section 7) in India, and Income doesn't accrue (or doesn't deemed to be accrued under section 9) in India.
If such an income satisfies one or none the above conditions then it is an Indian income.
Income from salaries Income from house property Profits and gains of business or profession Capital gains and Income from other sources
Particulars
10(5)
Death-cum-Retirement Gratuity
10(10)
Particulars
Commuted value of Pension (not taxable for specified Government employees) 10(10A)
Leave encashment
10(10AA)
Retrenchment Compensation
10(10B)
10(10C)
10(10CC)
10(13)
10(13A)
10(14)
The Act contains list of perquisites which are always taxable in all cases and a list of perquisites which are exempt in all cases (List I). All other perquisites are to be calculated according to specified provision and rules for each. Only two deductions are allowed under Section 16, viz. Professional Tax and Entertainment Allowance (the latter only available for specified government employees).
[show]Computation of exemption for gratuity [Section 10(10)]
Income under this head is taxable if the assessee is the owner of a property consisting of building or land appurtenant thereto and is not used by him for his business or professional purpose. An individual or an Hindu Undivided Family (HUF) is eligible to claim any one property as Self-occupied if it is used for own or family's residential purpose. In that case, the Net Annual Value (as explained below) will be nil. Such a benefit can only be claimed for one house property. However, the individual (or HUF) will still be entitled to claim Interest on borrowed capital as deduction under section 24, subject to some conditions. In the case of a self occupied house deduction on account of interest on borrowed capital is subject to a maximum limit of 150,000 (if loan is taken on or after 1 April 1999 and construction is completed within 3 years) and 30,000 (if the loan is taken before 1 April 1999). For let-out property, all interest is deductible, with no upper limits. The balance is added to taxable income. The computation of income from let-out property is as under:Gross annual value (GAV)1 Less:Municipal Taxes paid Net Annual value (NAV) Less:Deductions under section 242 Income from House property xxxx (xxx) xxxx (xxx) xxxx
^1 The GAV is higher of Annual Letting Value (ALV) and Actual rent received/receivable during the year. The ALV is higher of fair rent and municipal value, but restricted to standard rent fixed by Rent Control Act. ^2 Only two deductions are allowed under this head by virtue of section 24, viz.,
30% of Net annual value as Standard deduction Interest on capital borrowed for the purpose of acquisition, construction, repairs, renewals or reconstruction of property (subject to certain provisions).
Specific deductions
Sections 30 to 37 cover expenses which are expressly allowed as deduction while computing business income.
Specific disallowance
Deemed Incomes
Special provisions
Sections 42, 43C, 43D, 44, 44A, 44B, 44BB, 44BBA, 44BBB, 44DA, 44DB.
The computation of income under the head "Profits and Gains of Business or Profession" depends on the particulars and information available.
[7]
If regular books of accounts are not maintained, then the computation would be as under: Income (including deemed income) chargeable as income under this head xxx Less: Expenses deductible (net of disallowances) under this head (xx) However, if regular books of accounts have been maintained and profit and loss account has been prepared, then the computation would be as under: -
xxx
xx
xx
(xx)
Less: Incomes chargeable under other heads credited to Profit & Loss A/c (xx)
For tax purposes, there are two types of capital assets: Long term and short term. Transfer of long term assets gives rise to long term capital gains. The benefit of indexation is available only for long term capital assets. If the period of holding is more than 36 months, the capital asset is long term, otherwise it is short term. However, in the below mentioned cases, the capital asset held for more than 12 months will be treated as long term:-
Any share in any company Government securities Listed debentures Units of UTI or mutual fund, and Zero-coupon bond
Also, in certain cases, indexation benefit is not be available even though the capital asset is long term. Such cases include depreciable asset (Section 50), Slump Sale (Section 50B), Bonds/debentures (other than capital indexed bonds) and certain other express provisions in the Act. There are different scheme of taxation of long term capital gains. These are:
1.
As per Section 10(38) of Income Tax Act, 1961 long term capital gains on shares or securities or mutual funds on which Securities Transaction Tax (STT) has been deducted and paid, no tax is payable. STT has been applied on all stock market transactions since October 2004 but does not apply to off-market transactions and company buybacks; therefore, the higher capital gains taxes will apply to such transactions where STT is not paid.
2.
In case of other shares and securities, person has an option to either index costs to inflation and pay 20% of indexed gains, or pay 10% of non indexed gains. The cost inflation index rates are released by the I-T department each year.
3.
In case of all other long term capital gains, indexation benefit is available and tax rate is 20%.
All capital gains that are not long term are short term capital gains, which are taxed as such:
Under section 111A, for shares or mutual funds where STT is paid, tax rate is 10% from Assessment Year (AY) 2005-06 as per Finance Act 2004. With effect from AY 2009-10 the tax rate is 15%.
In all other cases, it is part of gross total income and normal tax rate is applicable.
For companies abroad, the tax liability is 20% of such gains suitably indexed (since STT is not paid). Besides exemptions under section 10(33), 10(37) & 10(38) certain specific exemptions are available under section 54, 54B, 54D, 54EC, 54F, 54G & 54GA.
Section 54
Secti on 54B
Sectio n 54D
Sectio n 54EC
Section 54F
Section 54G
Section 54GA
Section 54GB
Who is eligible to Individu Any pers Any pers Individual/HUF Individual/HUF Any person claim al on on exempt ion
Any person
Individual/ HUF
Agricult ural land (if used by individu al or his Which parents asset is for A residential eligible agricultu house property for ral (long term) exempt purpose ion during at least 2 years immedia tely prior to transfer)
Land/buil ding forming part of an industrial undertaki ng which is compulso rily acquired by the Governm ent & which is used during 2 years for industrial purposes prior to acquisitio n
Any long term capital asset (other than house property) Any long provided that term on the date of capital transfer the asset assessee does not own more than one residential house property
Long-term residential property if Land/building/plant/ transfer Land/building/plant/ machinery in order takes place machinery in order to shift an industrial between if to shift an industrial undertaking from transfer undertaking from urban area to takes place urban area to rural any Special during area Economic Zone April 1, 2012 and March 31, 2017
Land/buil Agricult ding for ural land industrial in rural purpose or urban
Section 54
Sectio n 54D
Sectio n 54EC of India or R ural Electrific ation Corporati on Limited; Maximu m exemptio n in one financial year is 5 million
Section 54F
Section 54G
Section 54GA
Section 54GB
Purchase: 1year backward or 2 years 2 years forward;Constr forward uction:3 years forward
3 years forward
Purchase: 1year backward 6 months or 2 years 1-year backward or forward forward;Constr 3 years forward uction:3 years forward
Equity shares in an eligible company to be acquired on or before due date of filing return of income as under section 139(1). The eligible company should utilize this amount for the purchase of a new asset within one year from the date of subscriptio n in equity shares
How Investment in much is the new asset or exempt capital gain, whichever is
Investment in the new asset or capital gain, whichever is lower (The new
Investment in the new asset or capital gain, whichever is lower (The new
Section 54
Secti on 54B capital gain, whichev er is lower (The new asset should not be transferr ed within 3 years of its acquisiti on)
Sectio n 54D
Sectio n 54EC gain, whicheve r is lower (The new asset should not be transferre d within 3 years of its acquisitio n); The new asset should not be converted into money or any loan/adva nce should not be taken on the security of the new asset within 3 years from the date of its acquisitio n
Section 54F
Section 54G
Section 54GA
Section 54GB
lower (The new asset should not be transferred within 3 years of its acquisition)
gain, whicheve r is lower (The new asset should not be transferre d within 3 years of its acquisitio n)
Capital gain; The assessee should not complete construction of another residential house property within 3 years from the date of transfer of original asset nor should he purchase within 2 years from the date of transfer of original asset another house property
gain net sale considerati on. (The exemption is revoked if equity shares are sold/transf erred within 5 years from acquisition or the new asset is sold/transf erred by the company within 5 years from acquisition )
1. 2. 3. 4. 5. 6. 7.
Income by way of Dividends. Income from horse races/lotteries. Employees' contribution towards staff welfare scheme. Interest on securities (debentures, Government securities and bonds). Any amount received from keyman insurance policy as donation. Gifts (subject to certain conditions and exemptions). Interest on compensation/enhanced compensation.
Any rent or revenue derived from land, which is situated in India and is used for agricultural purposes.
Any income derived from such land by agricultural operations including processing of agricultural produce, raised or received as rent-in-kind so as to render it fit for the market or sale of such produce.
Income attributable to a farm house (subject to some conditions). Income derived from saplings or seedlings grown in a nursery.
Incomea
Business income
Agricultural income
40%
60%
Sale of latex or cenex or latex based crepes or brown crepes manufactured from field latex or coalgum obtained from rubber plants grown by a seller in India
35%
65%
25%
75%
40%
60%
^a For apportionment of a composite business-cum-agricultural income, other than the above mentioned, the market value of any agricultural produce, raised by the assessee or received by him as rent-in-kind and utilized as raw material in his business, should be deducted. No further deduction is permissible in respect of any expenditure incurred by the assessee as a cultivator or receiver of rent-in-kind.
source | editbeta]
Deductions allowed under Chapter VI-A i.e., sections 80C to 80U, cannot exceed gross total income of an assessee excluding short term capital gains under section 111A and any long term capital gains. Some deductions under sections 80C to 80DDB are listed below.
1.
Contribution to approved superannuation fund/public provident fund/recognized provident fund/statutory provident fund. Provident fund contribution should not exceed /5 of salary & public provident fund.
1
2.
Payment of life insurance premium. It is allowed on premium paid on self, spouse and children even if they are not dependent on father or mother (subject to a maximum of 20% of sum assured up to FY 2012-13, from FY 2013-14 20% has been reduced to 10%).
3. 4. 5. 6. 7.
Payment in respect of non-commutable deferred annuity. Unit linked Insurance policy of UTI/LIC Mutual fund Dhanraksha. Subscriptions to National Savings Certificates VIII issues. Deposits with National Housing Bank. Principal part of loan taken for acquiring Residential House Property; provided that the house should not be transferred within 5 years Loan for land cost for residential house is also qualified.
8.
Subscriptions to schemes of PSU's providing long term finance for housing, or of housing boards constituted in India for infrastructural development of cities/towns.
9.
10. Units of Mutual Fund or UTI. 11. Notified pension fund by UTI or approved mutual fund. 12. Tuition fees (not including donation or development fees) towards full-time education including play-school activities, pre-nursery & nursery classes,
of any 2 children of an individual, paid to University, College or School in India. 13. Investments in shares or debentures with a lock-in-period of 3 years, of approved public company exclusively engaged in infrastructure facility or power sector. 14. Subscription to the bonds issued by NABARD as specified by Central Government. 15. Any sum deposited as 5 years time deposit under Post Office Term Deposit. 16. Any sum deposited in Senior Citizen Savings Scheme. 17. Any sum deducted from salary of Government employee (subject to maximum 20% of salary) towards deferred annuity plan for benefit of self, spouse or any children. 18. Term deposit with scheduled bank for a period of not less than 5 years as per scheme notified by Central Government. 19. Investing in units of notified mutual fund investing in approved public companies engaged in infrastructure facility or power sector.
senior citizen dependent parents or 20,000.00 for premium payment towards senior citizen dependent). This deduction is in addition to 100,000 savings under IT deductions clause 80C. For consideration under a senior citizen category, the incumbent's age should be 60 years during any part of the current fiscal, e.g. for the fiscal year 2010-11, the incumbent should already be 60 as on 31 March 2011), This deduction is also applicable to the cheques paid by proprietor firm.
u/s 80ee. This deduction would be allowed provided that the total value of the loan is not more than 2.5 million and the total value of the house is not more than 4 million and the loan should be a fresh loan taken during the financial year 2013-14. This deduction would be over and the 150,000 deduction The losses from all properties shall be allowed to be adjusted against salary income at the source itself. Therefore, refund claims of T.D.S. deducted in excess, on this count, will no more be necessary.
[14]
-If the assessee is a company (not having any inter-nation transaction), or -If the assessee is any person other than a company whose books of accounts are required to be audited under any law, or -If the assessee is a working partner in a firm whose books of accounts are required to be audited under any law.
30 November of the AY
If the assessee is a company and it is required to furnish report under section 92E pertaining to international transactions.
31 July of the AY
If the Income of a Salaried Individual is less than 500,000 and he has earned income through salary or Interest or both, such Individuals are exempted from filing their Income Tax return provided that such payment has been received after the deduction of TDS and this person has not earned interest more than 10,000 from all source combined. Such a person should not have changed jobs in the financial year.
[15]
CBDT has announced that all individual/HUF taxpayers with income more than 500,000 are required to file their income tax returns online. However, digital signatures wont be mandatory for such class of taxpayers.
[15]
Otherwise
Any default in payment of advance tax attracts penalty under section 234B and any deferment of advance tax attracts penalty under section 234C.
[17]
Section
Nature of payment
TDS to be deducted
192
Exemption limit
193 2
10%
194A 2
Interest (other than interest on securities) to 10000 (for Bank/cooperative any resident bank) & 5000 otherwise
10%
194B
10000
30%
5000
30%
30000 (for single contract) & 2% (for companies/firms) & 1% 75000 (for aggregate consideration otherwise in a financial year)
194D
20000
10%
194E
Not applicable
10%
194EE
20%
194G
10%
5000
10%
180000
194IA
5000000
1%
194J 2
30000
10%
Interest paid by Infrastructure Development 194LB Fund under section 10(47) to non-resident or foreign company
5%
195
Interest or other sums (not being salary) paid to non-residents or foreign company except under section 115O
^1 At what time tax has to be deducted at source and some other specifications are subject to the above sections. ^2 In most cases, these payments shall not to deducted by an individual or an HUF if books of accounts are not required to be audited in the immediately preceding financial year.
In most cases, the tax deducted should be deposited within 7 days from the end of the month in which tax was deducted.
For companies, income is taxed at a flat rate of 30% for Indian companies. Foreign companies pay at the income tax at the rate of 40%.
[18]
An education cess of 3% (on both the tax and the surcharge) are payable.
[20]
[19]
From 2005-06,
Foreign company
1. 2. 3. 4. 5.
Normal return Belated return Revised return Defective return Returns in response to notices
whichever is earlier.
within 30 days from the end of such financial year or within 30 days from the date of the completion of the production of the film,
which is
(b) has failed to comply with a notice under sub-section (1) of section 142 or sub-section (2) of section 143 or fails to comply with a direction issued under sub-section (2A) of section 142, or (c) has concealed the particulars of his income or furnished inaccurate particulars of such income, he may direct that such person shall pay by way of penalty,(ii) in the cases referred to in clause (b), in addition to any tax payable by him, a sum of ten thousand rupees for each such failure; (iii) in the cases referred to in clause (c), in addition to any tax payable by him, a sum which shall not be less than, but which shall not exceed three times, the amount of tax sought to be evaded by reason of the concealment of particulars of his income or the furnishing of inaccurate particulars of such income.
Service tax in India Central Excise (India) Value Added Tax (India)
13. ^ http://www.tax.fintotal.com/Sections/80U-Tax-Rebate/5916/68 14. ^http://www.incometaxindia.gov.in/publications/1_Compute_Your_Salary_Income/2 _Income_from_house_property.asp 15. ^ a b http://www.caclubindia.com/articles/e-filing-is-mandatory-income-is-more-than5-lacs-17646.asp 16. ^ "Due Dates and Calculation of Advance Tax". IndianTaxUpdates.com. Retrieved 23 March 2013. 17. ^ "Interest and Penalty on Non Payment of Advance Tax". IndianTaxUpdates.com. Retrieved 25 March 2013. 18. ^ Income Tax Act, tax rates for foreign companies 19. ^ Finance Act 2010 20. ^ Surcharge has been revised from 10% to 7.5% w.e.f AY 2010-11.Corporate taxpayers must file electronically, point 4 of I T circular. 21. ^ "Return Filing Due Dates". Retrieved 21 July 2012. 22. ^ "Annual Information return". 23. ^ Section 271 of India IT Act 24. ^ Penalties and Limitations of late filing of I-T returns
Navigation menu
Create account Log in
Main page Contents Featured content Current events Random article Donate to Wikipedia
Interaction Help About Wikipedia Community portal Recent changes Contact page
This page was last modified on 11 August 2013 at 12:43.
Edit links
Text is available under the Creative Commons Attribution-ShareAlike License; additional terms may apply. By using this site, you agree to the Terms of Use and Privacy Policy. Wikipedia is a registered trademark of the Wikimedia Foundation, Inc., a non-profit organization.