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DEDUCTION [U/S 80 C] [with effect
from A.Y.2006-07]
LIP; (restricted to 20%
of capital sum assured)
LIP/PPF/ULIP
of self, ...
Subscriptions to NSC VIII Issues. Term Deposit mentioned
at Point 15 would be for a fixed period of not less than five
yea...
DEDUCTION [U/S 80 CCC]
Payment made
out of taxable
income to LIC or
to any other
approved insurer
under approved
Pension P...
DEDUCTION [U/S 80 DD]
• For meaning of the word 'disability' reference is to be
made to Sec 2(i) of the Persons with Disab...
DEDUCTION [U/S 80 E]
• Repayment (out of taxable income) of interest
on loan taken for pursuing higher education
• The ent...
DEDUCTION [U/S 80 U]
Income of a person, with disability
To help disable person by reducing his tax by their section has b...
DEDUCTION [U/S 80 CCD]
Individual who is a Central
Government
employee, employed on or
after 1-1-2004.
Contribution
made b...
INCOME FROM OTHER SOURCES
• INTRODUCTION :
• “Income from Other Sources” is a residuary head of income.
Any item of income...
• There are some incomes, which are exempt, while others
are taxable. The taxability of Income is either under the
head sa...
OBJECTIVE
• After going through this lesson you will be able
to understand the various incomes, which are
included in the ...
BASIS OF CHARGE(SEC 56) :
• BASIS OF CHARGE(SEC 56) Any income which
does not cover any other head of income. Eight
other ...
SPECIAL PROVISION :
• SPECIAL PROVISION Dividend Lottery
Employees contribution to words staff welfare
scheme. Interest on...
BROAD CONCLUSION :
• BROAD CONCLUSION Income can be invoked
only if all the following conditions are satisfied.
There is a...
DIVIDEND :
• Under section 2(22) it is inclusive definition.
Distribution of accumulated profit entailing
release of compa...
Interest on securities sec.56(2)id :
• Interest on securities sec.56(2)id Means-
Interest on any securities of the CG or S...
Interest exempted from tax
sec.10(15)
• Interest exempted from tax sec.10(15) Interest
on notified securities bond or cert...
Receipt without consideration is
treated income sec.56 (2)vi(vii)
• Receipt without consideration is treated income
sec.56...
Five category
• Five category Aggregate amt exceed 50k but on
or after October 1 2009 . Any immovable
property is received...
EMPLOYEES' CONTRIBUTION
TOWARDS FUND
• If the employer receives any money from his
employees towards Provident Fund or
Sup...
RENTAL INCOME ON HIRING OF
PLANT,MACHINERY OR FURNITURE
• Any income received as rent from hiring of Plant &
Machinery or ...
Deduction are permissible
• Deduction are permissible Commission or
remuneration for realizing dividend or interest
on sec...
Specific disallowance
• Specific disallowance Following amounts are not
deductible while computing income- Amount
deductib...
THANK YOU
Direct & indirect  taxes
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Direct & indirect taxes

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Transcript of "Direct & indirect taxes"

  1. 1. • •
  2. 2. DEDUCTION [U/S 80 C] [with effect from A.Y.2006-07] LIP; (restricted to 20% of capital sum assured) LIP/PPF/ULIP of self, spouse, children (including minors) or members of HUF. (a) PF, (b) Superannuation Fund, (c) PPF; (d) RPF PF contribution not to exceed 1/5th of salary. Deposits in P.O. Savings Bank (CTD). Land cost for residential house is also qualified.
  3. 3. Subscriptions to NSC VIII Issues. Term Deposit mentioned at Point 15 would be for a fixed period of not less than five years and as per scheme to be notified by Central Government. Investments in shares or debentures of approved public company exclusively engaged in infrastructure facility or power sector. Tuition Fees (not donation or development fees) towards full time education of any 2 Children of an Individual paid to University, College, School, etc. in India. Deduction amount: Rs. 1,00,000
  4. 4. DEDUCTION [U/S 80 CCC] Payment made out of taxable income to LIC or to any other approved insurer under approved Pension Plan. Deduction amount: Rs. 10,000 Rs. 1,00,000
  5. 5. DEDUCTION [U/S 80 DD] • For meaning of the word 'disability' reference is to be made to Sec 2(i) of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 (PDEOPRFP), and section 2(a), (c) and (h) of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation & Multiple Disabilities Act, 1999 (NTWPACPMR MD Act). Disabilities covered are blindness, low vision, leprosy-cured, hearing impairment, locomotor disability, autism, cerebral palsy, multiple disability, mental retardation and mental illness. • Deduction amount: Rs. 50,000 Rs. 75,000
  6. 6. DEDUCTION [U/S 80 E] • Repayment (out of taxable income) of interest on loan taken for pursuing higher education • The entire amount of interest is deductible without any limit . • Deduction amount: Rs. 40,000
  7. 7. DEDUCTION [U/S 80 U] Income of a person, with disability To help disable person by reducing his tax by their section has been incorporated. The Assesse is an individual with disability. Certificate from Medical Authority in the form and manner prescribed Deduction amount: Rs. 50,000 Rs. 15,000
  8. 8. DEDUCTION [U/S 80 CCD] Individual who is a Central Government employee, employed on or after 1-1-2004. Contribution made by the assessee and by the Central Government to the notified Pension scheme Amount contributed by the assessee and/or the Central Government as does not exceed in each case 10% of his salary. The aggregate amount of deduction cannot exceed Rs. 1,00,000
  9. 9. INCOME FROM OTHER SOURCES • INTRODUCTION : • “Income from Other Sources” is a residuary head of income. Any item of income chargeable to tax but does not fall within the ambit of the other four specific heads of income shall be included under this head of income. • Any income received as rent from hiring of Plant & Machinery or from furniture belonging to the assessee will be taxable under the head Income from other sources if it is not taxable under business income. For instance, a car rental company's income would be taxable as its business income. However, if a person who has no need for a car rents out the same to his friends on weekends, then the income for such idle-period letting would be taxable as Income from Other Sources.
  10. 10. • There are some incomes, which are exempt, while others are taxable. The taxability of Income is either under the head salary, house property, business income or capital gain. All of these heads of income are mentioned under section 16 of the income tax act. You have read about these income heads in the previous lessons. • The incomes, which are neither covered under the above heads of salary, house property, business income, or capital gain, are covered in the head of income from other sources. This head of income is a residual head because it tries to cover all other incomes which are uncovered and which are not exempt from tax. • Deductions available against this income, include, repairs, insurance and depreciation on plant, machinery, furniture, etc.
  11. 11. OBJECTIVE • After going through this lesson you will be able to understand the various incomes, which are included in the income from other sources. Also you will be able to understand how income from dividend, income by way of interest is taxed and the concepts of grossing and net.
  12. 12. BASIS OF CHARGE(SEC 56) : • BASIS OF CHARGE(SEC 56) Any income which does not cover any other head of income. Eight other income which are always taxable on the head of other sources.
  13. 13. SPECIAL PROVISION : • SPECIAL PROVISION Dividend Lottery Employees contribution to words staff welfare scheme. Interest on securities. Rental income of machinery ,plant and furniture. Rental income of letting out of plant ,machinery or furniture along with letting out of building and the two meetings are not seprable. Sum received under keyman insurance policy Gift. Interest on compensation or enhanced compensation.
  14. 14. BROAD CONCLUSION : • BROAD CONCLUSION Income can be invoked only if all the following conditions are satisfied. There is a income Income shall not be exempted. not covered by other head.
  15. 15. DIVIDEND : • Under section 2(22) it is inclusive definition. Distribution of accumulated profit entailing release of company asset sec 2(22)a. Distribution of accumulated profit in the form of debuntre,debuntre stock sec 2(22)b. Distribution at the time of liquidation.2(22)c Distribution of profit on the reduction of capital 2(22)d Distribution of accumulated profit by way of loan or advance.sec 2(22)e
  16. 16. Interest on securities sec.56(2)id : • Interest on securities sec.56(2)id Means- Interest on any securities of the CG or SG. Interest on debenture or other securities for money issued by or on behalf of a local authority or a company or a corporation established by a central ,state or provincial act.
  17. 17. Interest exempted from tax sec.10(15) • Interest exempted from tax sec.10(15) Interest on notified securities bond or certificate. Interest on notified relief fund. Interest on deposit for Bhopal gas victim. Interest on gold deposit bond issued under the scheme of gold deposit 1999. Interest on notified issued by local authority or by state pooled finance entity applicable from the AY 08-09.
  18. 18. Receipt without consideration is treated income sec.56 (2)vi(vii) • Receipt without consideration is treated income sec.56 (2)vi(vii) A receipt of money without consideration is chargeable to tax if he satisfy these conditions. Received by any individual or HUF. Received on or after 1-10-2009. It does not fall on the exempted category. Fall on the following category…….
  19. 19. Five category • Five category Aggregate amt exceed 50k but on or after October 1 2009 . Any immovable property is received on or after 1-10-2009 and stamp duty except road 50k. Immovable property for a consideration which is less than the stamp duty. Movable property without consideration. Movable property for a consideration less than fair market.
  20. 20. EMPLOYEES' CONTRIBUTION TOWARDS FUND • If the employer receives any money from his employees towards Provident Fund or Superannuation Fund or any other fund towards the welfare of its employees, then the same will be taxable under the head Income from other sources if it is not taxable under business income. • Any sum credited by the assessee to the employee's account in the relevant fund, on or before the date by which the employer is required to credit the employee's contribution under any Statute or Order, would be allowed as a deduction to the employer.
  21. 21. RENTAL INCOME ON HIRING OF PLANT,MACHINERY OR FURNITURE • Any income received as rent from hiring of Plant & Machinery or from furniture belonging to the assessee will be taxable under the head Income from other sources if it is not taxable under business income. For instance, a car rental company's income would be taxable as its business income. However, if a person who has no need for a car rents out the same to his friends on weekends, then the income for such idle-period letting would be taxable as Income from Other Sources. • Deductions available against this income, include, repairs, insurance and depreciation on plant, machinery, furniture, etc.
  22. 22. Deduction are permissible • Deduction are permissible Commission or remuneration for realizing dividend or interest on securities. Deduction in respect of employees contribution toward staff welfare scheme 57(ia). Repair ,depreciation in the case of letting of plant ,machinery ,furniture building. Standard deduction in the case of family pension. Any other expense for earning income.
  23. 23. Specific disallowance • Specific disallowance Following amounts are not deductible while computing income- Amount deductible under sec.58 Personal expense. Interest. salary. Wealth tax. Amount specified by sec 40A Expenditure in respect of royalty and technical fees received by a foreign company. Expenditure in respect of winning lotteries.
  24. 24. THANK YOU
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