After understanding corporations and limited liability, you might wonder if it’s fair. If Bill had owned the cab himself and got sued, the soccer player whose career was ruined would have received…
Category: Income Tax
The Indian Income Tax Act of 1961 is the key legislation governing income tax in India, covering individuals and entities like corporations and firms. It classifies income into five main heads: salaries, income from house property, business profits, capital gains, and other sources, with specific rules and exemptions for each category.
Administered by the Income Tax Department under the Ministry of Finance, the Act is updated periodically to reflect economic changes and fiscal policies. Key amendments include incentives for savings, investments, and specific expenses like medical costs, supporting both compliance and financial planning.
The Act is central to India’s financial system, generating revenue for government programs while providing tax benefits to promote social goals. Its structure upholds transparency and fairness in the taxation process, ensuring accountability within India’s economic framework.
Beginner’s Guide on Computation of Capital Gains Tax in India
Analysis of Section 48 The income chargeable under the head ‘Capital gains’ shall be computed by deducting the following items from the full value of the consideration received or accruing as a…
Unabsorbed Capital Expenditure on Scientific Research
What is Section 35(4)? For claiming deduction on account of deduction of capital expenditure on scientific research, it may be noted that the deduction of such capital expenditure shall be allowed to…
Computation of capital gain in case of zero coupon bonds
The Finance Act, 2005 has introduced the procedure regarding the taxation of the income on the Zero Coupon Bonds being issued on or after 1.6.2005. The provisions are as under: (1) Meaning…
TDS on Interest other than Interest on Securities
Who is liable to deduct tax [Section 194A(1)] The person (other than an individual or a Hindu Undivided Family) who is responsible for paying to a resident any income by way of…
TDS on Payment of Life Insurance Policy [Section 194DA]
What is Section 194DA? Any person responsible for paying to a resident any sum under a life insurance policy (including the sum allocated by way of bonus) shall deduct the tax at…
Section 32AD: Deduction for investment in new plant and machinery
Manufacturing unit eligible for deduction @ 15% of actual cost of new asset being eligible plant and machinery [Section 32AD(1)] An additional investment allowance of an amount equal to 15% of the…
Unabsorbed Depreciation or Losses [Section 115JB(3)]
Even where the book profits liability is imposed, the amounts of business loss, unabsorbed depreciation, investment allowance, etc., at the beginning of the accounting year are to be adjusted and set off…
Amount borrowed or repaid on hundi [Section 69D]
What is Section 69D? Where any amount is borrowed on a hundi from, or any amount due thereon is repaid to, any person otherwise than through an account payee cheque drawn on…
Reverse Mortgage and Capital Asset Transfer [Section 47(xvi)]
Under Section 47(xvi), any transfer of a capital asset as part of a reverse mortgage scheme is not considered a taxable transfer. This scheme, set up and approved by the Central Government,…