This document provides an introduction to income tax in India, including an overview of its introduction in 1961, definitions of key terms, and descriptions of the main heads of income. It notes that income tax is a direct tax paid by the same person who bears the burden. It also outlines several types of exempted incomes and explains the meaning of a Permanent Account Number. Finally, it describes the five main heads of income - salary, house property, business/profession, capital gains, and other sources - and provides a brief overview of each.

2. Introduction to income tax :
 Overview :
• Passed in September 1961
• Come into operation i.e. of 01.04.1962
• Extends to whole of India.
• Rate of IT are given in the ‘finance act’ passed
by the parliament every year

3. Meaning of Income Tax
o Income tax is a direct tax
 In case of direct tax the burden and incidence
are on the same person who pays the tax.
 But in the case of indirect tax the burden is on
the one and the incidence on another.

4. Exempted Incomes

5. Meaning of Exempted Incomes:
 Agricultural income fully exempted u/s 10(1)
 Share of income from HUP-fully exempted
 Share of income from firm assessed as firm (PEAF)
fully exempted u/s 10(2A)
 Any income from investment by an NRI in bonds and
securities –fully exempted. No exemption such
bonds issued after 1.06.2002
 Interest paid to a non resident person who is a
person of Indian origin-full exempted . No
exemption on such bonds issued after 1.06.2002
 Travel concession to an Indian citizen employee-
exempted up to limits laid down u/s 10(5)

6. Meaning :PAN CARD
As permanent account number is a ten digit
alphanumeric number issued in the form of
laminated ,by the income tax department to
any persons who applies for it or to whom the
department allots the number without an
application .

7. Brief Introduction of Heads
Of Incomes :
 Under income tax 1961 (section 14) income of a person
is calculated under various defined heads of income.
The total income is first assessed under heads of
income and then it is charged from as IncomeTax as
under rules of income tax act . According income tax
act under section 14:
 There are following heads of income under which total
income of a person is calculated :
 Salary
 House property
 Profit in business
 Capital gains
 Other income sources

8. 1ST HEAD OF INCOME : Salary
 Overview :
An income can be taxed under
head salaries if there is relationship of an
employer and employee between the payer
and payee. If this relationship does not , then
the income would not be deemed to be
income from salary
• If there is no element of employer-employee
relationship the income shall not be
assessable under this head of income

9. 2nd HEAD OF INCOME : House
property
 Overview :
Tax on income from house property is the tax on
rental income which is being earned from the house
property. However in case the property is not being rented
out, tax would be levied on the expected rent that would
have been received if this property was rented out.
• Income from house property is perhaps the only income is
charged to tax on notional basis.Tax under this head does
not only include income from letting out of house property
but also includes income from letting out of commercial
properties & all types of properties.Various deductions
like:
• Standard deduction
• Deduction for municipal taxes paid
• Deduction for interest on home loan is also allowed under
this head of income.

10. 3rd HEAD OF INCOME : Profits
& gains from business or
profession
 Any income earned from any trade/commerce/
manufacture/profession shall be chargeable under
this head of income after deducting specified
expenses.

11. 4th HEAD OF INCOME : Capital
Gains
 Overview :
Any profit or gains arising from
the transfer of a capital asset effected in the
financial year shall be chargeable to Income
tax under the head ‘Capital Gains’ & shall be
deemed to be the income of the year in which
the transfer took place unless such capital
gain is exempt under SECTION
54,54B,54D,54EC,54ED,54FOR 54GA

12. 5th HEAD OF INCOME :Other
income sources
Overview :
Any income which is not
chargeable to tax under the above mentioned 4
heads of income shall be chargeable under this
head of income provided that income is not
exempt from the computation of total income

13. E-Filing

14. Instructions about E-filing
:

15. Historical Perspective about
e-filing

16. TYPES OF E-FILING

17. Diagram of types of e-
filing

18. Procedure of e-filing :

23. THANK YOU …………..
Submitted by :
Megha Sharma
BBA – 4th sem…
Roll no : 5821