This document discusses various aspects of income under the head "Business and Profession" as defined in the Income Tax Act of 1961 in India. It defines what constitutes a business and profession and outlines the key points regarding income from business and profession being taxable only if carried out in the previous year. It discusses the specific deductions that are allowed under sections 30-37 of the act for various business expenses like rent, repairs, depreciation, insurance premium, salary, bonus, interest paid, contributions to provident funds, gratuity funds, and bad debts. It provides details on the conditions and limits for claiming these deductions.
Lecture 13 profits and gains from business or professionsumit235
This document summarizes provisions related to computing taxable income from business and profession under the Indian Income Tax Act. It covers what types of income fall under this head, the meaning of key terms like business, profession and vocation. It also discusses the basic principles for arriving at business income, allowable deductions for expenses, depreciation, and scientific research expenditure.
The document summarizes various provisions related to the computation of income from business or profession under the Indian Income Tax Act. It discusses the meaning of business income and what types of incomes are chargeable under this head. It also outlines specific deductions allowed like rent, repairs, depreciation, scientific research, preliminary expenses, and more. It provides details on the calculation of profits, losses, treatment of unabsorbed depreciation and the methods of claiming depreciation.
Presentation on computation of profits and gains of business and profession for the benefit of taxation students, based B. Com Taxation syllabus of Goa University .
It defines key terms like business, profession, and vocations. It outlines the general principles for assessing profits from business/profession including deductions allowed, expenses disallowed, and depreciation rates. It describes two methods for computing taxable profits- adjusting the assessee's profit and loss account or preparing a fresh income and expenditure account. It also provides details on specific deductions allowed for expenses related to business premises, machinery/equipment, and scientific research.
Profit & Gains from Business or Profession.RAJESH JAIN
This document provides an overview of income from business and profession under the Indian Income Tax Act. It defines business and profession, outlines the key points and basis of charge for income from business/profession. It also discusses the computation of income, specific deductions allowed, depreciation rules and amounts that are not deductible. The key information includes definitions of business and profession, income includes profits and losses, relevance of accounting method, and that income from illegal businesses is taxable.
Advanced taxation (cfap5) by fawad hassan [lecture 5]Fawad Hassan
This document summarizes key concepts related to business income under Pakistan's tax laws. It discusses various types of assets used in business and related concepts like acquisition, cost, depreciation, disposal and consideration. It also covers topics like pre-commencement expenses, scientific research expenses, bad debts, employee training, and allowable financial costs. The document provides definitions and rules for these concepts across 18 sections in a detailed but structured manner.
Advanced taxation (cfap5) by fawad hassan [lecture 6]Fawad Hassan
1. Capital gains can arise from the disposal of capital assets, which includes all property except stock-in-trade, depreciable assets, intangibles, and certain movable property for personal use. Gains are taxed on an accrual basis in the year of disposal.
2. Key considerations in deciding a capital gains tax case include determining the geographical source of income and applicable tax rates, as well as reviewing relevant sections of the Income Tax Ordinance regarding capital gains tax, capital gains on securities, special provisions, deduction of losses, and non-recognition rules.
3. Gains or losses from the disposal of certain assets like artwork or jewelry will not be recognized, while gains from immovable
Objectives & Agenda :
To analyse and interpret the provisions of the Income-tax Act relating to computation of 'Profits and gains of business or profession' (PGBP). In this Webinar, we shall look at the charging section for PGBP and provisions relating to computation of PGBP, admissible deductions and allowances including Depreciation.
Lecture 13 profits and gains from business or professionsumit235
This document summarizes provisions related to computing taxable income from business and profession under the Indian Income Tax Act. It covers what types of income fall under this head, the meaning of key terms like business, profession and vocation. It also discusses the basic principles for arriving at business income, allowable deductions for expenses, depreciation, and scientific research expenditure.
The document summarizes various provisions related to the computation of income from business or profession under the Indian Income Tax Act. It discusses the meaning of business income and what types of incomes are chargeable under this head. It also outlines specific deductions allowed like rent, repairs, depreciation, scientific research, preliminary expenses, and more. It provides details on the calculation of profits, losses, treatment of unabsorbed depreciation and the methods of claiming depreciation.
Presentation on computation of profits and gains of business and profession for the benefit of taxation students, based B. Com Taxation syllabus of Goa University .
It defines key terms like business, profession, and vocations. It outlines the general principles for assessing profits from business/profession including deductions allowed, expenses disallowed, and depreciation rates. It describes two methods for computing taxable profits- adjusting the assessee's profit and loss account or preparing a fresh income and expenditure account. It also provides details on specific deductions allowed for expenses related to business premises, machinery/equipment, and scientific research.
Profit & Gains from Business or Profession.RAJESH JAIN
This document provides an overview of income from business and profession under the Indian Income Tax Act. It defines business and profession, outlines the key points and basis of charge for income from business/profession. It also discusses the computation of income, specific deductions allowed, depreciation rules and amounts that are not deductible. The key information includes definitions of business and profession, income includes profits and losses, relevance of accounting method, and that income from illegal businesses is taxable.
Advanced taxation (cfap5) by fawad hassan [lecture 5]Fawad Hassan
This document summarizes key concepts related to business income under Pakistan's tax laws. It discusses various types of assets used in business and related concepts like acquisition, cost, depreciation, disposal and consideration. It also covers topics like pre-commencement expenses, scientific research expenses, bad debts, employee training, and allowable financial costs. The document provides definitions and rules for these concepts across 18 sections in a detailed but structured manner.
Advanced taxation (cfap5) by fawad hassan [lecture 6]Fawad Hassan
1. Capital gains can arise from the disposal of capital assets, which includes all property except stock-in-trade, depreciable assets, intangibles, and certain movable property for personal use. Gains are taxed on an accrual basis in the year of disposal.
2. Key considerations in deciding a capital gains tax case include determining the geographical source of income and applicable tax rates, as well as reviewing relevant sections of the Income Tax Ordinance regarding capital gains tax, capital gains on securities, special provisions, deduction of losses, and non-recognition rules.
3. Gains or losses from the disposal of certain assets like artwork or jewelry will not be recognized, while gains from immovable
Objectives & Agenda :
To analyse and interpret the provisions of the Income-tax Act relating to computation of 'Profits and gains of business or profession' (PGBP). In this Webinar, we shall look at the charging section for PGBP and provisions relating to computation of PGBP, admissible deductions and allowances including Depreciation.
This document discusses capital gains tax in India. It defines capital gains as profits arising from the transfer of a capital asset. It outlines the conditions for gains to be classified as capital gains, including that the asset must be transferred. It also defines short-term and long-term capital assets based on the holding period. Several exemptions are provided under sections 54, 54B, 54D, 54EC, 54F, and 54G if the capital gains are reinvested in specified assets within certain time periods.
Foreign direct investment (FDI) refers to a company from one country making a physical investment into building a factory in another country. To qualify as FDI, the parent company needs to own at least 10% of voting shares of the foreign affiliate. There are various types of FDI, including joint ventures and setting up branches or project offices abroad. FDI can be attracted through economic growth opportunities, deregulation policies, and operational flexibility offered in a country. Both foreign and domestic companies face various tax implications for foreign collaborations in India.
The document discusses various aspects of determining profits and gains from business or profession under the Income Tax Act, including:
1. Items that are charged to tax under this head, such as profits from any business/profession carried out by the assessee.
2. Deductions that are allowed in computing profits, such as rent, rates, taxes, insurance, repairs, depreciation, scientific research expenditures, license fees, and other expenditures.
3. Disallowances under sections 40A and 40B for payments without TDS deduction or exceeding specified limits.
Objectives & Agenda :
To analyse and interpret the provisions of the Income-tax Act relating to chargeability of Income from Sources other than Salary, House Property, Business or Profession and Capital Gains. In this Webinar, we will discuss the various incomes that are chargeable under the head 'Income From Other Sources' which covers Dividends, Gifts, Certain Interest, Advance money forfeited etc. Finally, the Webinar will touch upon relevant Judicial Precedents.
1. The document discusses various aspects related to capital gains tax in India including understatement of consideration, reference to valuation officers, transfers between partners and firms, family arrangements, computation of capital gains, and short term versus long term capital assets.
2. It explains the powers of assessing officers to refer cases to valuation officers if the stated consideration is lower than fair market value and the consequences if the valuation officer arrives at a higher value.
3. The treatment of various transfers like between partners and firms, conversion of assets, insurance claims, and retirement of partners is explained citing relevant case laws and tax law sections.
The document discusses capital gains tax in India. Some key points:
- Profits from the sale of a capital asset are taxed as capital gains and deemed as income in the year the asset is transferred.
- A capital asset is broadly defined as property including both movable and immovable assets, tangible and intangible. Certain assets like stock, personal effects, and agricultural land up to certain limits are excluded.
- Capital assets held for over 36 months are considered long-term, while those held for less than 36 months are short-term. Different tax rates apply to long-term versus short-term capital gains.
- Various transactions like distributions on partition of HUF, gifts, transfers
The document defines an investment holding company (IHC) as a company that derives at least 80% of its gross income from holding investments. IHCs treat income like dividends and interest as "unearned income" and can only deduct a fraction of expenses. In contrast, an investment dealing company actively buys and sells investments and treats income as normal business income with full deduction of expenses. The document provides examples of computing an IHC's permitted expense fraction and determining IHC status based on the 80% income criterion.
Objectives & Agenda :
To analyse and interpret the provisions of the Income-tax Act relating to computation and chargeability of Capital Gains. In this Webinar we shall look at various types of transfers which are exempted from capital gains, cost of acquisition in certain specified cases, capital gains on specified assets and finally, capital gains in case of non-residents. Also, the Webinar will touch upon relevant Judicial Precedents.
Malaysian Taxation 2
42
Example (bad debt)
Runny is a building contractor. He has lent a sum without any
security to Lee a family friend who is also a contractor. Lee has
gone bankrupt and the debt has become bad. Can Runny claim
the bad debt as a deduction?
Answer:
No, the debt to Lee cannot be claimed as a bad debt deduction
as the loan was not made in the course of Runny's business as a
building contractor but was a personal/private loan to a friend.
Malaysian Taxation 2
43
Example (stock in trade)
Amal Bhd is a manufacturer of
Income-tax is an important consideration for any transaction, but over the past two and a half years of working in transaction advisory, I have observed that even qualified chartered accountants and lawyers don't fully grasp income-tax implications of M&A transactions. Through this deck, I attempt to throw some light on basic income-tax implications and ignite a fulfilling discussion with fellow professionals. I hope this assists and motivates readers to deep dive into the various aspects of income-tax in M&A transactions.
Capital gains can arise from the transfer of capital assets. Under the Income Tax Act, certain capital gains are fully or partially exempt from taxation if the sale proceeds are invested in specified assets within a prescribed time period. Some of the key exemptions include investments made within 2 years under Section 54 in a new residential house, Section 54B for agricultural land, Section 54D/F for shifting/reestablishing an industrial undertaking, and Section 54EC for specified bonds. Failure to invest in the new asset within the specified time period results in the earlier exempted capital gains becoming taxable in the year of transfer of the new asset.
This document discusses the taxation of capital gains in India under the Income Tax Act of 1961. It defines capital assets and differentiates between short-term and long-term capital assets. Gains from the transfer of short-term capital assets are taxed at normal tax rates, while long-term capital gains are taxed at concessional rates. There are various exemptions available for capital gains reinvested in residential houses, agricultural land, specified bonds, shifting of industrial undertakings, and more. The document provides details on computation of capital gains and applicable tax rates for different types of taxpayers.
The document provides an overview of capital gains in India. It defines capital assets and discusses the different types of capital assets and capital gains. It explains that capital gains are taxable if a capital asset is transferred, resulting in a gain. The summary is:
[1] Capital gains arise from the transfer of a capital asset if the sale price is higher than the cost of acquisition and improvements.
[2] Capital assets exclude personal assets and assets held as stock-in-trade.
[3] Gains are classified as short-term or long-term depending on whether the asset was held for less or more than 36 months.
This document discusses taxation laws related to income from other sources in India. It provides an overview of key topics including the definition of income from other sources, examples of such income like dividends, lottery winnings, interest income, rental income. It discusses the taxation treatment of various types of dividends including deemed dividends. It also outlines deductions that can be claimed against income from other sources and amounts that are expressly disallowed. The document contains information on taxation of various other income streams like winnings, interest income and is intended to provide a comprehensive overview of the subject to the requester.
The document discusses business income taxation for individuals under Malaysian law. It covers key topics like the definition of a business, badges of trade used to distinguish between business and investment activities, derivation of business income, and allowable business deductions. Specifically, it examines how income from a Malaysian company providing computer services to a client in Indonesia would be treated for tax purposes.
This document provides an overview of capital allowances under Malaysian tax law. It discusses that while accounting depreciation is not tax deductible, taxpayers are granted tax depreciation or "capital allowances" on qualifying capital expenditures to determine taxable income. Capital allowances are only given for business sources and only to the person who incurs the qualifying expenditure. The document outlines the types of capital allowances (initial allowance, annual allowance, notional allowance), eligibility requirements, qualifying expenditures, treatment of plant and machinery purchases and disposals, and other related topics.
This document provides an overview of Ind AS 36 - Impairment of Assets. It begins with an agenda outlining the key topics to be covered, including objective and scope, definitions, recognition and measurement requirements, required disclosures, differences between Ind AS 36 and the corresponding Indian accounting standard AS 28, and the potential impact on ILGIC. Some of the main points covered include: assets within the scope of Ind AS 36, the definition of impairment and key terms, procedures for identifying and measuring impairment losses, impairment loss allocation methods, and additional annual testing required under Ind AS 36 for certain assets.
This document discusses the key requirements of Ind AS 19 on employee benefits. It covers the accounting for short-term employee benefits such as compensated absences, profit sharing and bonus plans. For post-employment benefits, it discusses the treatment for defined contribution plans which are expensed as incurred, and defined benefit plans which require actuarial valuation using the projected unit credit method. The document also discusses other long term benefits and termination benefits. Key disclosure requirements under Ind AS 19 are provided.
The document discusses various aspects of income from business and profession that are taxable under the Income Tax Act of 1961 in India. It defines business and profession and outlines that income must be from activities carried out during the previous year. It also discusses key deductions that can be claimed like rent, repairs, insurance, depreciation, interest paid, employee bonuses and contributions to provident funds. Specific conditions apply to claiming many of these deductions.
The document discusses key aspects of income from business and profession under the Income Tax Act of 1961 in India. It defines business and profession, outlines the basis of charge for income from business/profession, and describes various deductions that are allowed under sections 30-37 of the Act such as rent, repairs, insurance, depreciation, bad debts, and more. It provides explanations and conditions for claiming many of these deductions.
This document discusses capital gains tax in India. It defines capital gains as profits arising from the transfer of a capital asset. It outlines the conditions for gains to be classified as capital gains, including that the asset must be transferred. It also defines short-term and long-term capital assets based on the holding period. Several exemptions are provided under sections 54, 54B, 54D, 54EC, 54F, and 54G if the capital gains are reinvested in specified assets within certain time periods.
Foreign direct investment (FDI) refers to a company from one country making a physical investment into building a factory in another country. To qualify as FDI, the parent company needs to own at least 10% of voting shares of the foreign affiliate. There are various types of FDI, including joint ventures and setting up branches or project offices abroad. FDI can be attracted through economic growth opportunities, deregulation policies, and operational flexibility offered in a country. Both foreign and domestic companies face various tax implications for foreign collaborations in India.
The document discusses various aspects of determining profits and gains from business or profession under the Income Tax Act, including:
1. Items that are charged to tax under this head, such as profits from any business/profession carried out by the assessee.
2. Deductions that are allowed in computing profits, such as rent, rates, taxes, insurance, repairs, depreciation, scientific research expenditures, license fees, and other expenditures.
3. Disallowances under sections 40A and 40B for payments without TDS deduction or exceeding specified limits.
Objectives & Agenda :
To analyse and interpret the provisions of the Income-tax Act relating to chargeability of Income from Sources other than Salary, House Property, Business or Profession and Capital Gains. In this Webinar, we will discuss the various incomes that are chargeable under the head 'Income From Other Sources' which covers Dividends, Gifts, Certain Interest, Advance money forfeited etc. Finally, the Webinar will touch upon relevant Judicial Precedents.
1. The document discusses various aspects related to capital gains tax in India including understatement of consideration, reference to valuation officers, transfers between partners and firms, family arrangements, computation of capital gains, and short term versus long term capital assets.
2. It explains the powers of assessing officers to refer cases to valuation officers if the stated consideration is lower than fair market value and the consequences if the valuation officer arrives at a higher value.
3. The treatment of various transfers like between partners and firms, conversion of assets, insurance claims, and retirement of partners is explained citing relevant case laws and tax law sections.
The document discusses capital gains tax in India. Some key points:
- Profits from the sale of a capital asset are taxed as capital gains and deemed as income in the year the asset is transferred.
- A capital asset is broadly defined as property including both movable and immovable assets, tangible and intangible. Certain assets like stock, personal effects, and agricultural land up to certain limits are excluded.
- Capital assets held for over 36 months are considered long-term, while those held for less than 36 months are short-term. Different tax rates apply to long-term versus short-term capital gains.
- Various transactions like distributions on partition of HUF, gifts, transfers
The document defines an investment holding company (IHC) as a company that derives at least 80% of its gross income from holding investments. IHCs treat income like dividends and interest as "unearned income" and can only deduct a fraction of expenses. In contrast, an investment dealing company actively buys and sells investments and treats income as normal business income with full deduction of expenses. The document provides examples of computing an IHC's permitted expense fraction and determining IHC status based on the 80% income criterion.
Objectives & Agenda :
To analyse and interpret the provisions of the Income-tax Act relating to computation and chargeability of Capital Gains. In this Webinar we shall look at various types of transfers which are exempted from capital gains, cost of acquisition in certain specified cases, capital gains on specified assets and finally, capital gains in case of non-residents. Also, the Webinar will touch upon relevant Judicial Precedents.
Malaysian Taxation 2
42
Example (bad debt)
Runny is a building contractor. He has lent a sum without any
security to Lee a family friend who is also a contractor. Lee has
gone bankrupt and the debt has become bad. Can Runny claim
the bad debt as a deduction?
Answer:
No, the debt to Lee cannot be claimed as a bad debt deduction
as the loan was not made in the course of Runny's business as a
building contractor but was a personal/private loan to a friend.
Malaysian Taxation 2
43
Example (stock in trade)
Amal Bhd is a manufacturer of
Income-tax is an important consideration for any transaction, but over the past two and a half years of working in transaction advisory, I have observed that even qualified chartered accountants and lawyers don't fully grasp income-tax implications of M&A transactions. Through this deck, I attempt to throw some light on basic income-tax implications and ignite a fulfilling discussion with fellow professionals. I hope this assists and motivates readers to deep dive into the various aspects of income-tax in M&A transactions.
Capital gains can arise from the transfer of capital assets. Under the Income Tax Act, certain capital gains are fully or partially exempt from taxation if the sale proceeds are invested in specified assets within a prescribed time period. Some of the key exemptions include investments made within 2 years under Section 54 in a new residential house, Section 54B for agricultural land, Section 54D/F for shifting/reestablishing an industrial undertaking, and Section 54EC for specified bonds. Failure to invest in the new asset within the specified time period results in the earlier exempted capital gains becoming taxable in the year of transfer of the new asset.
This document discusses the taxation of capital gains in India under the Income Tax Act of 1961. It defines capital assets and differentiates between short-term and long-term capital assets. Gains from the transfer of short-term capital assets are taxed at normal tax rates, while long-term capital gains are taxed at concessional rates. There are various exemptions available for capital gains reinvested in residential houses, agricultural land, specified bonds, shifting of industrial undertakings, and more. The document provides details on computation of capital gains and applicable tax rates for different types of taxpayers.
The document provides an overview of capital gains in India. It defines capital assets and discusses the different types of capital assets and capital gains. It explains that capital gains are taxable if a capital asset is transferred, resulting in a gain. The summary is:
[1] Capital gains arise from the transfer of a capital asset if the sale price is higher than the cost of acquisition and improvements.
[2] Capital assets exclude personal assets and assets held as stock-in-trade.
[3] Gains are classified as short-term or long-term depending on whether the asset was held for less or more than 36 months.
This document discusses taxation laws related to income from other sources in India. It provides an overview of key topics including the definition of income from other sources, examples of such income like dividends, lottery winnings, interest income, rental income. It discusses the taxation treatment of various types of dividends including deemed dividends. It also outlines deductions that can be claimed against income from other sources and amounts that are expressly disallowed. The document contains information on taxation of various other income streams like winnings, interest income and is intended to provide a comprehensive overview of the subject to the requester.
The document discusses business income taxation for individuals under Malaysian law. It covers key topics like the definition of a business, badges of trade used to distinguish between business and investment activities, derivation of business income, and allowable business deductions. Specifically, it examines how income from a Malaysian company providing computer services to a client in Indonesia would be treated for tax purposes.
This document provides an overview of capital allowances under Malaysian tax law. It discusses that while accounting depreciation is not tax deductible, taxpayers are granted tax depreciation or "capital allowances" on qualifying capital expenditures to determine taxable income. Capital allowances are only given for business sources and only to the person who incurs the qualifying expenditure. The document outlines the types of capital allowances (initial allowance, annual allowance, notional allowance), eligibility requirements, qualifying expenditures, treatment of plant and machinery purchases and disposals, and other related topics.
This document provides an overview of Ind AS 36 - Impairment of Assets. It begins with an agenda outlining the key topics to be covered, including objective and scope, definitions, recognition and measurement requirements, required disclosures, differences between Ind AS 36 and the corresponding Indian accounting standard AS 28, and the potential impact on ILGIC. Some of the main points covered include: assets within the scope of Ind AS 36, the definition of impairment and key terms, procedures for identifying and measuring impairment losses, impairment loss allocation methods, and additional annual testing required under Ind AS 36 for certain assets.
This document discusses the key requirements of Ind AS 19 on employee benefits. It covers the accounting for short-term employee benefits such as compensated absences, profit sharing and bonus plans. For post-employment benefits, it discusses the treatment for defined contribution plans which are expensed as incurred, and defined benefit plans which require actuarial valuation using the projected unit credit method. The document also discusses other long term benefits and termination benefits. Key disclosure requirements under Ind AS 19 are provided.
The document discusses various aspects of income from business and profession that are taxable under the Income Tax Act of 1961 in India. It defines business and profession and outlines that income must be from activities carried out during the previous year. It also discusses key deductions that can be claimed like rent, repairs, insurance, depreciation, interest paid, employee bonuses and contributions to provident funds. Specific conditions apply to claiming many of these deductions.
The document discusses key aspects of income from business and profession under the Income Tax Act of 1961 in India. It defines business and profession, outlines the basis of charge for income from business/profession, and describes various deductions that are allowed under sections 30-37 of the Act such as rent, repairs, insurance, depreciation, bad debts, and more. It provides explanations and conditions for claiming many of these deductions.
Lecture 12 income from business and professionsumit235
This document provides an overview of income from business and profession under the Income Tax Act. It discusses the various types of income that are taxed under this head, allowable deductions like rent, depreciation, scientific research expenditures, and disallowances. Key points include that income from any business, profession or vocation is taxed, various expenditures are deductible, depreciation is allowed on written down value of blocks of assets, and certain payments must be made by due date to claim deductions.
This document summarizes key provisions around deductions allowed under business and professional income in the Income Tax Act. It discusses sections related to deductible expenses like depreciation, preliminary expenses, scientific research, etc. It also covers inadmissible expenses and special provisions for certain industries. Specific deductions are outlined for tea/coffee development funds, site restoration funds, voluntary retirement schemes, and insurance premiums. The document categorizes the various deduction sections and provides explanations of select concepts like block of assets and mandatory claiming of depreciation.
Understanding Income Tax - Profits & Gains of Business or Profession [Sec 35 ...DVSResearchFoundatio
The document discusses various sections of the Income Tax Act relating to deductions available for businesses and professions. Section 35 allows deductions for expenditure incurred on scientific research. Sections 35ABA and 35ABB allow amortization of capital expenditure incurred for acquiring spectrum rights or license to operate telecommunication services. Section 35AD provides a 100% deduction for capital expenditure incurred for specified businesses like developing affordable housing, setting up hospitals, operating cold storage facilities, if certain conditions are met. The sections outline eligible expenditures, calculation of deductions, treatment of assets on sale, and implications of non-compliance.
Understanding Income Tax - Profits & Gains of Business or Profession [Sec 36 ...DVSResearchFoundatio
Objectives & Agenda :
To analyse and interpret the provisions of the Income-tax Act relating to computation of 'Profits and gains of business or profession' (PGBP). In this Webinar, we shall look at the general admissible deductions, amounts not deductible, deductions subject to payments, Computation of income in case of construction and service contracts, Insurance business, etc. Finally, the Webinar will touch upon relevant Judicial Precedents.
PROFITS AND GAINS OF BUSINESS OR PROFESSION 2022.pptsmeetsanghvi
The document discusses various provisions related to business income under the Indian Income Tax Act. It provides details on the meaning of business, basis of charge, expenses allowed as deductions, depreciation allowance, and specific allowances like scientific research. It also discusses the computation of written down value, block of assets, additional depreciation, and weighted deductions for expenditure on scientific research.
This document provides an overview of deductions allowed for business profits and gains under the Indian Income Tax Act. It discusses specific deductions like rent, repairs, taxes, depreciation, and others. It also describes the general scheme for calculating taxable profits, including the methods of accounting, specific vs general deductions, and presumptive taxation provisions. The key points covered are the types of expenses that are deductible, the conditions for claiming depreciation, and the overall framework for determining taxable business income.
This document provides an overview of the taxation of profits and gains from business or profession under the Indian Income Tax Act. Some key points:
- Profits from any business, profession, compensation payments, export incentives, benefits from business, interest from a partnership, and more are taxable under this head.
- Deductions are allowed for expenses like rent, repairs, depreciation, research and development, acquiring telecom licenses, and more.
- Depreciation can be claimed on buildings, machinery, vehicles and more. Additional depreciation is available for new machinery.
- Certain payments must be on a paid basis per Section 43B, like taxes, contributions, bonuses to claim deductions.
Start ups and MSMEs: Registration and Advantages features of Atmanirbhar packageNovojuris
Startups and MSMEs can register on relevant government portals to receive several benefits. Startups must register within 10 years of formation and have annual turnover less than Rs. 100 crore to qualify for benefits like income tax exemptions, self-certification under labour laws, stock options for founders. MSMEs must register based on investment and turnover limits set for micro, small and medium enterprises to prevent delayed payments and access collateral-free loans. The document outlines the registration processes and documents required for each as well as their key benefits.
- Income from other sources is a residual head of income that covers any income that does not fall under the other four heads of income (salary, house property, business/profession, capital gains).
- Some examples included under this head are dividend income, interest income, rental income from machinery/furniture, winnings from lotteries, gifts received without consideration.
- Standard deductions are available for repairs, insurance, depreciation of assets let out on rent. Interest received on securities and specific exempt categories are not taxed under this head.
This document provides an overview of the taxation of profits and gains from business or profession under the Indian Income Tax Act. Key points include:
- Profits from any business, profession, compensation for loss of agency, export incentives are taxable under this head.
- Deductions are allowed for expenses like rent, repairs, depreciation, scientific research, license fees, and other expenditures based on sections 30-40 of the Act.
- Certain payments to related parties and exceeding specified limits are disallowed. Depreciation, amortization and deduction rules are defined.
The document discusses various aspects related to the chargeability and computation of profits and gains from business or profession under Section 28 of the Income Tax Act.
It provides details on the types of incomes that are included in business profits and gains such as profits from current and discontinued businesses, compensation received on termination of agency, etc. It also discusses deductions that are expressly allowed like rent, repairs, depreciation, amortization of certain expenditures. Special provisions for calculation of capital gains on sale of depreciable assets are covered. The rates of depreciation for different block of assets are mentioned.
The document discusses various aspects of dividends, including:
1) Types of dividends such as interim, final, special dividends.
2) Sources of dividends including current year's profits, previous years' undistributed profits, and capital profits.
3) Procedures for declaring dividends including recommendation by the board of directors, approval by shareholders, payment within 30 days of declaration.
This document provides an overview of income from profits and gains of business or profession under the Indian Income Tax Act. It defines key terms like business, profession, and vocation. It outlines the various heads of income that are taxable under profits and gains from business/profession. It also summarizes important rules regarding the computation of profits, deductions allowed, and expenses disallowed. The document includes examples and illustrations to explain concepts like computation of depreciation, additional depreciation, and deductions under sections 33AB and 33ABA.
Income from business & profession U.pptSusantoSaha1
The document discusses income from business and profession under the Income Tax Ordinance of Bangladesh. It defines business and profession and outlines the scope of income that falls under this head. It describes various types of deemed income from business or profession. It then explains the allowable deductions to determine the taxable income from business or profession, as well as deductions that are not permitted. The document provides a breakdown of how to calculate taxable income from business or profession.
This document discusses various aspects of dividends, including:
- The definition of a dividend as profits distributed to shareholders.
- The types and forms of dividends such as interim, final, special dividends.
- The sources of dividends which can include current year's profits, previous years' undistributed profits, or capital profits.
- Key processes around dividend declaration including ascertainment of distributable profits, provisions for depreciation, declaration, payment and handling of unclaimed dividends.
- Important dates associated with dividends like declaration, ex-dividend, record and payment dates.
COMPARISON OF DTC WITH INCOME TAX ACT FOR BUSINESS INCOME92_neil
The document compares how business income is determined under the Direct Tax Code (DTC) and the Income Tax Act 1961.
Under both laws, income from any business carried out by the assessee during the year is taxable under the head "profits and gains from business". The DTC categorizes business expenses into operating expenses, finance charges, and capital allowances whereas the Income Tax Act covers these under multiple sections.
The DTC also provides separate schedules to compute income from specific businesses like insurance, shipping etc. and allows the government to notify if these schedules will not apply. The Income Tax Act contains similar but more detailed provisions to compute profits from different businesses under distinct heads.
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The document discusses various aspects of tax planning and financial management decisions from a tax perspective. It defines tax planning as actions taken by a taxpayer to meet tax obligations in an orderly manner while availing all permissible exemptions. Tax planning is necessary to minimize tax costs in the same way businesses try to reduce other costs. Tax planning considerations include direct and indirect taxes and the key objectives are availing tax concessions while arranging affairs to minimize tax incidence. The document also discusses tax management, capital structure, investment decisions including making or buying parts, and considerations for setting up new industrial units.
ISO/IEC 27001, ISO/IEC 42001, and GDPR: Best Practices for Implementation and...PECB
Denis is a dynamic and results-driven Chief Information Officer (CIO) with a distinguished career spanning information systems analysis and technical project management. With a proven track record of spearheading the design and delivery of cutting-edge Information Management solutions, he has consistently elevated business operations, streamlined reporting functions, and maximized process efficiency.
Certified as an ISO/IEC 27001: Information Security Management Systems (ISMS) Lead Implementer, Data Protection Officer, and Cyber Risks Analyst, Denis brings a heightened focus on data security, privacy, and cyber resilience to every endeavor.
His expertise extends across a diverse spectrum of reporting, database, and web development applications, underpinned by an exceptional grasp of data storage and virtualization technologies. His proficiency in application testing, database administration, and data cleansing ensures seamless execution of complex projects.
What sets Denis apart is his comprehensive understanding of Business and Systems Analysis technologies, honed through involvement in all phases of the Software Development Lifecycle (SDLC). From meticulous requirements gathering to precise analysis, innovative design, rigorous development, thorough testing, and successful implementation, he has consistently delivered exceptional results.
Throughout his career, he has taken on multifaceted roles, from leading technical project management teams to owning solutions that drive operational excellence. His conscientious and proactive approach is unwavering, whether he is working independently or collaboratively within a team. His ability to connect with colleagues on a personal level underscores his commitment to fostering a harmonious and productive workplace environment.
Date: May 29, 2024
Tags: Information Security, ISO/IEC 27001, ISO/IEC 42001, Artificial Intelligence, GDPR
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Thinking of getting a dog? Be aware that breeds like Pit Bulls, Rottweilers, and German Shepherds can be loyal and dangerous. Proper training and socialization are crucial to preventing aggressive behaviors. Ensure safety by understanding their needs and always supervising interactions. Stay safe, and enjoy your furry friends!
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Artificial Intelligence (AI) technologies such as Generative AI, Image Generators and Large Language Models have had a dramatic impact on teaching, learning and assessment over the past 18 months. The most immediate threat AI posed was to Academic Integrity with Higher Education Institutes (HEIs) focusing their efforts on combating the use of GenAI in assessment. Guidelines were developed for staff and students, policies put in place too. Innovative educators have forged paths in the use of Generative AI for teaching, learning and assessments leading to pockets of transformation springing up across HEIs, often with little or no top-down guidance, support or direction.
This Gasta posits a strategic approach to integrating AI into HEIs to prepare staff, students and the curriculum for an evolving world and workplace. We will highlight the advantages of working with these technologies beyond the realm of teaching, learning and assessment by considering prompt engineering skills, industry impact, curriculum changes, and the need for staff upskilling. In contrast, not engaging strategically with Generative AI poses risks, including falling behind peers, missed opportunities and failing to ensure our graduates remain employable. The rapid evolution of AI technologies necessitates a proactive and strategic approach if we are to remain relevant.
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Assessment and Planning in Educational technology.pptxKavitha Krishnan
In an education system, it is understood that assessment is only for the students, but on the other hand, the Assessment of teachers is also an important aspect of the education system that ensures teachers are providing high-quality instruction to students. The assessment process can be used to provide feedback and support for professional development, to inform decisions about teacher retention or promotion, or to evaluate teacher effectiveness for accountability purposes.
This slide is special for master students (MIBS & MIFB) in UUM. Also useful for readers who are interested in the topic of contemporary Islamic banking.
The simplified electron and muon model, Oscillating Spacetime: The Foundation...RitikBhardwaj56
Discover the Simplified Electron and Muon Model: A New Wave-Based Approach to Understanding Particles delves into a groundbreaking theory that presents electrons and muons as rotating soliton waves within oscillating spacetime. Geared towards students, researchers, and science buffs, this book breaks down complex ideas into simple explanations. It covers topics such as electron waves, temporal dynamics, and the implications of this model on particle physics. With clear illustrations and easy-to-follow explanations, readers will gain a new outlook on the universe's fundamental nature.
Liberal Approach to the Study of Indian Politics.pdf
unit- 2 Business and Profession
1. Income under the Head Business
and Profession
By
Praveen B
Assistant Professor,
Department of Commerce and Management,
PES Institute of Advance Management Studies, Shivamogga
3. MEANINGOFBUSINESS: SEC2(13)
Businessmeans any economic activity carried
on for earning profits. ItIncludes,
• a)Trade,
• b) Commerce
• c) Manufacture
• d) Any adventure or concern in thenature
of trade, commerce ormanufacture.
4. MEANINGOFPROFESSION: SEC2(36)
Aprofessionis an occupation requiring purely
intellectual skill or manualskill.
• E.g.Lawyer, accountant, engineer, doctor,
author.
• It also includesvocation.
5. INCOMEFROMBUSINESS& PROFESSION
-:- KEYPOINTS-:-
• Must be carried on byAssessee.
• Must be carried on during theprevious year.
• Only profit of the previous year are to be taxed.
• Income includes negative income i.e.Loss.
• APersonCannot do business with one self. Hence,
notional profit is not taxable. If aproprietor withdraws
goods casting Rs.50000for personal useat an agreed
value of Rs.60000then profit of Rs.10000shall not be
taxable.
• There is no difference between legal & illegal business
for taxation purpose. Evenincome from illegalbusiness
shall be taxable.
6. Basisof Charge: [ Sec28]
The following income shall be chargeable to income tax under
the
head “ Profit & Gains of Business or Profession.
• The profit or gains of any business or profession.[Sec 28(i)]
• Income derived by a trade, professional or similar
associationfrom specified services performed for its
members. [ Sec28 (ii)]
• The Value of any benefit or perquisite, whether convertible
into money or not, arising from business or the exercise of
profession. [ Sec28 (iv) ]
• Any interest, Salary, bonus, commission or remuneration
due to or received by a partner from a firm. [ Sec28 (v) ]
• Any Sum received for not carrying out any activity in
relation to any business or not to share any know-how,
patent, copyright, trademark etc. [ Sec28(va) ]
• Income from speculative transaction
7. SPECIFICDEDUCTIONS[Sec.30 to Sec37]
1.Rent, Rates ,Taxes& Insurance for Building used for the purpose of business. [ Sec
30]
2.Repairs & Insurance of Plant & Machinery , Furniture [ Sec31 ]
3.Depreciation of building or plant & machinery.[ Sec32]
4.Investment Allowance [ Sec32 AC]
5.Tea/Coffee/Rubber Development A/c [ Sec33 AB]
6.Site Restoration Fund [ Sec33 ABA ]
7.Reservefor Shipping Business [ Sec33 AC]
8.Scientific Research Expenditure [ Sec35]
9.Amortisation of telecom licence fees [ Sec35 ABB]
10.Expenditure on eligible projects or scheme [ Sec35 AC]
11.Deduction in respect of exp on specific business [ Sec35 AD]
12.Payment to Association and institution for carrying out rural development
program [Sec 35 CCA]
13.Weighted deduction for expenditure incurred on Agricultural Extension
Project [ Sec35 CCC]
14.Weighted deduction for expenditure for skill development [ Sec35CCD]
15.Amortisation of Preliminary Expenses [ Sec35D]
8. Other deductions
• Insurance premium of stock intrade
• Bonusor commission to employees
• Interest on borrowedcapital
• Employer’s contribution to providentand
other funds
• Employer’s contribution to theapproved
gratuity funds
• Baddebts
9. A. [ SECTION 30] : RENT,RATES,TAXES,REPAIRS&
INSURANCEOFBUILDINGSUSEDFORTHEPURPOSEOFTHE
BUSINESS
• Rentof the premises is allowed asdeduction. However, notional
rent paid by proprietor is not allowed asdeduction. But rent paid by
him to its partner for using his premises is allowedasdeduction.
• Currentrepairsif the assesseebears the cost of repairs are allowed
asdeduction. However, Capitalrepairsincurred by the assesseeare
neverallowed asdeduction whether premises is occupied asa
tenant or asaowner. Instead the capital repairs incurred shall be
deemed to be abuilding and depreciation shall beclaimed.
• Any sum on account of LandRevenue,LocalTaxesor Municipal
Taxessubject to section 43B. asper section 43Bdeductionshallbe
allowed only if such sum is actually paid on or before the due date
offurnishing or return ; and
• Insurance chargesagainstthe riskof damageor destruction of
buildingisallowed as deduction.
10. B.[ SECTION 31] : REPAIRS& INSURANCEOFPLANT,
MACHINERY&FURNITURE
• repairsto the plant, machineryandfurniture is
allowed asdeduction. However, capital repairs
incurred by the assesseeare never allowed as
deductionwhether plant is leased or is
purchased. Instead the capital repairs incurred
shall be deemed to be an asset eligible for
depreciation.
• Premium paid for insurance against the risk of
damage or destruction of plant, machinery or
furniture isallowed as deduction.
11. C.[ SECTION 32] : DEPRECIATION
• In respect of depreciationof-
(i)buildings, machinery, plant or furniture,being
tangible assets;
(ii)know-how, patents, copyrights, trade marks,
licenses, franchises or any other business or
commercial rights of similar nature, being
intangible assetsacquired on or after the1st day
of April,1998,
12. D. [ SECTION 36(1)(i)] : INSURANCEOFSTOCK
• Theamount of any Insurance premium paidin
respect of insurance against risk of damage or
destruction of stocks or stores used for the
purposes of the business is allowed as
discount.
13. E.[ SECTION 36(1)(ib) ] : INSURANCEPREMIUMONTHE
HEALTHOFEMPLOYEES
It is allowed asdeduction if followingconditions
are satisfied :
• a. ThePremium is paid by Chequeby the
employer; and
b. Premium is paid under the Schemeframed
in this behalf by the General Insurance
Corporation of India and approved by the
Central Government.
14. F. [ SECTION 36(1)(ii) ] : BONUSOR
COMMISSION PAIDTO
EMPLOYEES• Bonusor Commission paid to an employee is allowableas
deduction subject to certainconditions:
1.Admissibleonlyif not payable asprofit or dividend : Oneof
the conditions is that the amount payable to employees asBonusor
Commission should not otherwise have been payable to them as
profit or dividend. Thisis provided to checkan employer from
avoiding tax by distributing his / its profit by way of bonus among
the member employees of his/its concern, instead of distributing
the sum asdividend or profits.
2.Deductible onpayment basis:Bonusor Commission is allowed
asdeduction only where payment is made during the previous
year or on or before the due date of furnishing return of income
u/s 139.
15. G.[ SECTION 36(1)(iii)] : INTERESTPAIDONBORROWEDCAPITALFOR
THEPURPOSEOFBUSINESSORPROFESSION
• (i) CONDITIONS
Asper Supreme Court judgement :
• Thesum of money should be borrowed from another assessee.
• Theloan may be borrowed from any Bank, Financial Institution, Govt. , Public, friendsor
relatives.
• Loanmay be in the form of debentures ordeposits etc.
• Interest on capital or loan to proprietor is not allowed asdeduction since the loan is not
borrowed from another person.
• Interest paid by firm to its partner on their capital contribution is allowed as deduction.
• Suchborrowed money should be used for the purpose of business or profession. But
where the amount of loan is used for personal purpose it is not allowed asdeduction.
E.g.the loan is borrowed for the payment of income tax not allowed asdeduction.
However, loan is borrowed for payment of dividend or salestax is allowedasdeduction.
• TheInterest hasaccrued during the relevant previous year. However, where the interest
falls u/s 43B,i.e. where interest is payable to banksor financial institutions, then to
claim deduction suchinterest should actually be paid on or before the due date of
furnishing of return.
16. INTEREST ON BORROWINGS FOR ACQUIRING NEWASSETS
• ii) PROVISON 1 TO 36 (1)(iii). Interest accrued before the commencement of
business not allowed asdeduction but hasto be capitalized and added to the
actual cost of fixed assets acquired out of borrowed capital.
• Interest accrued after the commencement of business but before the asset is
put to use is not allowed as deduction but has to be capitalized and added to
the actual cost of the fixed assets acquired out of borrowed capital.
• Interest accrued after the assetis put to useis allowed asdeductionu/s
36(1)(iii)
OTHERPOINTS
• Where interest is paid outside India without deduction of tax at source is not
allowed asdeduction.
• Income tax department cannot question the need for borrowing and the rate
of interest.
• Interest other than interest on borrowing is allowed asdeduction u/s 37 and
not under this clause. E.g.Interest on late payment ofsalestax etc.
17. H. [ SECTION 36(1)(iv)] : EMPLOYER’SCONTRIBUTION
TOWARDSRECOGNIZEDPROVIDENTFUNDORAN
APPROVEDSUPERANNUATIONFUND.
• Employer’s contribution paid towardsrecognized
provident fund or an approved superannuation
fund is allowed asdeduction subject to Sec.43B.
However, contribution to Non-Statutory Fundor
Unapproved Fundis not allowed addeduction.
In caseof contribution towards superannuation
fund isallowed asdeductionu/s 37.
18. [ SECTION 36(1)(v)] : EMPLOYER’SCONTRIBUTIONPAID
TOWARDSANAPPROVEDGRATUITYFUND
• Any sum paid by the assesseeasan employer
by way of contribution towards an approved
gratuity fund created by him for the exclusive
benefit of his employees under anirrevocable
trust is allowed asdeduction subject to
section 43B.
19. J. [ SECTION 36(1)(va)] : EMPLOYEE’SCONTRIBUTION
TOWARDSSTAFFWELFARESCHEME.
• Any sum received by the assesseefrom his employees as
contributions :
• to any provident fundor
• superannuation fund or
• any fund set up under the provisions of theEmployee’s State
InsuranceAct, or
• any other fund for the welfare of such employee
• is treated asincome in the hands of assesseeunlesssuch
employee’s contribution is credited in employee’s account on or
before the ‘due date’ specified under the provisions of any law or
terms of contract of service orotherwise.
However employer’s contribution (not employee’s contribution)
towards suchfund is allowed asdeduction subject to section43B
i.e. such contribution is paid on or before the due date of furnishing
return.
20. K.[ SECTION 36(1) (vii)] : BADDEBTS
• (i) Conditions
• Adeduction will be allowed in respect of any BadDebt which is written off as
irrecoverable in the account of the assessee for the previous year subject to the
conditions specified in Sec.36(2) asfollows :
• 1. No such deduction shall be allowed unless such debt or part thereof has
been taken into account in computing the income of the assessee of the
•
•
previous year in which the amount of such debt or part thereof is written off or
of an earlier previous year,or
e.g. Credit Salemade Rs.50,000not realized. Rs.50,000shall beallowed
asdeduction since saleis treated asincome.
Advancemade for purchase of stocks.Advanceforfeited not allowed as
deduction since advancemoney not apart ofincome.
• Representsmoney lent in the ordinary course of the business of banking or
money lending which is carried on by theassesses
• (ii) Notes
• 1.
• 2.
BadDebt canbe claimed asdeduction by the successorof thebusiness
However Provision for BadDebt is not alloweddeduction.
21. (iii) Section 41(4). Recovery of BadDebt
• Where adeduction hasbeen allowed in respect
of abad debt or part of debt, then, if the amount
subsequently recovered on any such debt or part
is greater than the difference between the debt
or part of debt and the amount soallowed, the
excessshall be deemed to be profits and gainsof
businessor profession, and accordingly
chargeable to income-tax asthe income of the
previous year in which it is recovered, whether
the business or profession in respect of which the
deduction hasbeen allowed is in existence inthat
year or not.
22. L. [ SECTION36(1)(ix)] : FAMILYPLANNINGEXPENDITURE
INCURREDBYCOMPANY
• Deductionin respectof Revenue
Expenditure for promoting familyplanning
amongst its employees is allowed as
deduction and in caseof Capital expenditure,
1/5 of expenditure incurred is allowed as
deduction in 5 equalinstallment.
23. N. [ SECTION37 ] : GENERALDEDUCTION
• (i) Conditions
• Thisis aresiduary section. Hencethis section coversonly those items of
businessexpenditure which are not covered under section 30 to 36. the
deductions u/s 37 is allowed if expenditure satisfies all the three conditions
mentioned below :
• Expenditure is incurred wholly and exclusively for the purpose of the business.
Theword ‘wholly’ refers to the quantum of expenditure and the word
‘exclusively’ refers to the motive, object or purpose of the expenditure. The
expression ‘ for the purpose of the business’is essentially wider than the
expression ‘ for the purpose of earning profits’.
• SuchExpenditure is not in the nature of personal expenditure.
• Suchexpenditure is not of Capital in nature i.e. expenses should be of revenue
in nature. Theword “Capital” connotes permanency and“Capital
Expenditure” is , therefore, closely akin to the concept of securing something,
tangible or intangible property , or corporeal or incorporeal right, sothat they
could be of alasting or enduring benefit to the enterprise in issue. Revenue
expenditure, on the other hand, is operational in its perspective and solely
intended for the furtherance of the enterprise.
24. FollowingExpenditureswere heldto beincurred
wholly andexclusivelyfor the purposeof the Business
• Official or AdministrativeExpenses
• Audit or LegalFees
• Advertising Expenses,Traveling or Conveyance Expenses
• Entertainment Expenses
• Interest paid for overdraftfacility
• Remuneration payable to employees or otherexpenses
incurred for the benefit ofemployees.
• Diwali Expenses
• Interest paid on payment of dividend is allowed as
deduction. (However interest on payment of income taxor
other personal liability is not allowed asdeduction).
25. FollowingExpenditurewere heldto bePersonal
Expenses
• Drawing by the owner for personaluse.
• Interest on own capital in caseof
proprietorship concern.
• Remuneration paid to owner ofthe business
in caseof Proprietaryconcern.
• Donation u/s 80Gor any other similar
donations not connected with businessofthe
assessee.(However business donation is
allowed as deduction)
26. Others ( not allowed asdeduction)
• AnyProvisions or Reservesfor contingencies,
anticipated loss, dividend, salestax, customduty,
excise, gratuity, bonus etc. (However, actual
payment of sales tax,excise duty or custom duty
is allowed asdeduction subject to Sec. 43B.)
• Note :However under section 40A(7) provision
made for gratuity whichbecomes payable in the
PYis allowed asdeduction.
• Notional Expenses,i.e. Rent Paidfor ownbuilding
etc.