Personal Taxation

G IMMANUVEL

Heads of Income  Income from Salary  Income from House Property  Income from Business or

Profession  Capital Gains  Income from Other Sources AD

- Tax

March

4, 2009

2

Computation of Total Income S No

Particulars

Amount

1

Income under Salary

6,00,000

2

Income from House Property

3,50,000

3

1,00,000

4

Business / Professional Income Capital Gains

5

Income from Other Sources

2,50,000

5,00,000

Gross Total Income

18,00,000

Less: Chapter VIA deduction

3,00,000

Total Income (Taxable Income) AD

- Tax

15,00,000 March

4, 2009

3

Salary - definition  Salary includes: (Section 17)  Wages including advance wages  Annuity or Pension  Gratuity  Perquisites  Leave salary  Fees or commission  Profit in lieu of salary

AD

- Tax

March

4, 2009

4

Perquisites – Sec 17(2)  Perquisites include:  Accomodation  Rent free accomodation  Temporary accomodation  Stay in Hotel  Two accomodation  Office cum Residence  Value of any benefit, amenity granted or

provided free of cost or at concessional rate  Sum paid by the employer in respect of any obligation which, but for such payment, would have been payable by the employee  Fringe Benefits  Medical facilities AD

- Tax

March

4, 2009

5

Medical Treatment  Reimbursement of Medical Expense are

exempted in the following cases:

 Medical treatment of employee or any member

of the family of such employee outside India including travel and stay  Medical treatment provided in any hospital / dispensary / clinic maintained by the employer.  Any sum paid on medical treatment for self or family:

 In any hospital maintained by the Government or any local authority or any other hospital approved by the Government.  In respect of prescribed diseases or ailments in any hospital approved by the Chief 6 AD - Tax March 4, 2009 Commissioner of Income Tax 



Perquisites….  Perquisites may either be monetary or 



 

non-monetary in nature NABARD bears the tax liability of employees on both monetary and nonmonetary perquisites Non-monetary perquisite tax on employee is paid directly by NABARD u/s 192(1A) of the IT Act NMP tax paid by employer is exempted u/s 10(10CC) Tax on monetary perquisite payable by the employee is reimbursed to the employee, which is added to the income of the7 AD

- Tax

March

4, 2009



Exemptions and Deductions  Exemptions are generally allowed on

specific income and reduced from the respective income earned and does not form part of the Total Income  Deductions are generally allowed after computing the Income under a particular head or from the Gross Total Income AD

- Tax

March

4, 2009

8



LTC - u/s 10(5) read with Rule 2B (i) where the journey is performed by air, economy

air fare by shortest route;  (ii) where places of origin of journey and destination are connected by rail and the journey is performed by any mode of transport other than by air, an amount not exceeding the airconditioned first class rail fare by the shortest route to the place of destination; and  (iii)where the places of origin of journey and destination or part thereof are not connected by rail and the journey is performed between such places, the amount eligible for exemption shall be : (A) where a recognised public transport system exists, an amount not exceeding the 1st class or deluxe class fare, as the case may be, on such transport by the shortest route to the place of destination; and  (B) where no recognised public transport system exists, an 9 amount equivalent to the air-conditioned class rail fare, AD - Tax first March 4, 2009 

Exemption from salary income  Gratuity  Commutation of Pension  Leave Salary  Voluntary Retirement Scheme  Maturity proceeds of Recognised

Provident Fund  House Rent Allowance  Medical expenses AD

- Tax

March

4, 2009

10

House Property Income  One house owned by the assessee

could be treated as self-occupied  If more than one house is owned by the assessee, only one house could be treated as self-occupied and other house should be treated as let out  Even if the second and subsequent house is occupied by the assessee, the same needs to be treated as deemed let out property AD

- Tax

March

4, 2009

11

Computation of HP Income

AD

- Tax

March

4, 2009

12

Income from other sources  Dividend  Winning from

lotteries, crossword puzzle, horse racces, card games etc  Interest on securities  Income from hiring plant, machinery etc  Gift received (except from relative, on marriage, by will/inheritance, local authority, charitable institution) AD

- Tax

March

4, 2009

13

Deduction from Gross Total Income  Investment specified u/s 80C  Premium paid for pension policies u/s    

80CCC Medical premium u/s 80D – 15000 / 20000 Person with disability u/s 80U Treatment for disabled dependents u/s 80DD Treatment for specified ailments u/s 80DDB AD

- Tax

March

4, 2009

14

AD

- Tax

March

4, 2009

15