Professional Documents
Culture Documents
Mr. X furnishes the following particulars of his income during the P.Y. relevant to the assessment year 2012-13 : 1. Interest from Germen Development Bonds (one-sixth received in India) Rs. 36,000/ 2.Income from agriculture in Pakistan received there but later on Rs. 86,000/- is remitted to India-Rs. 3,41,000/-
and ordinarily resident in India if he satisfies at least one of the basic conditions{i.e. (a) or (b) and the two additional conditions [i.e. (i) and (ii)]
Non-resident in India
Taxable in India
Note-1- If it is business income and business is controlled wholly or partly from India. Note-2- If it is income from profession which is set up in India.
Only two types of Not taxable in foreign incomes (i.e. India as per note-1 and Note-2 given below ) are taxable in India
Salary
Discuss the tax treatment that may be accorded to each of he following items in the hands of Mr. X 1. Company pays college fees of Rs. 1,800/during the year directly to the college for his son, while his daughter is getting free education in an institution run by the company. She is also given free transport in factory bus to and from the school.
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2.Mr. X availed 15 days leave out of 30 days to which he was entitled, he encashed the balance leave of 15 days and got Rs. 40,700/which he claimed to be exempt 3.He got an interest free loan of Rs.50,000/for construction of a house at his native place. The company accepts deposits at 7% from the public. However, SBI lending rate is 8%.
salary
4. Company pays Rs.1,000/- per annum on accident insurance policy for the benefit of X. 5. Company has reimbursed his club fee of Rs. 500 per annum and club bills of Rs. 4,000/ 6. The company made a car (800cc) available to him for official use and personal use. He reimbursed the company at Rs. 2.50 per kilometer for personal use.
salary
7. Medical bills reimbursement : Rs.44,000/(out of which Rs. 12,000/- is in respect of treatment in a Governments hospital) 8. Leave travel concession Rs.51,300/- (Actual expenditure is more than Rs.51,300/-) 9. Suppose Mr. X is a retired Government and gets a sum of Rs. 14,700/- per month as pension from the Government.
Salary-Example
Mr. X is in the Gujarat Government service till his retirement on May 31, 2008 when he joins A ltd. In which 35% equity shares are held by the Gujarat Government. During the pervious year 2011-12, he gets the following from A. ltd Basic salary: Rs. 20,000/- per month, D.A. Rs.2000/- per month (half of which is part of salary for retirement purposes): Rs. 2000/- per month, over time allowance up to 31-05-2011 Rs. 2,000/-helper allowance for office use Rs.1,000/per month(expenditure Rs. 800/- per month)
Salary-Example
Medical bills reimbursement : Rs. 55,000/-(out of which Rs. 15,000/- in the private hospital but approved by the Chief Commissioner of I.T.), Free Gas and electricity only for personal use :Rs. 24,000/-, free telephone at residence Rs. 9,000/-; free lunch in office: Rs12,000/- (amount paid directly to canteen @ Rs. 40 per day for 300 days), interest-free loan for house Rs. 2,00,000/for six years (SBI lending rate on 01-04-2011 : 10.25%),
Salary-Example
Earned leave encashment: Rs. 16,000/-(as per service rules X is entitled for 2 days leave for each month of service and during 2011-12, X has encashed 24 days leave earned during the year), medical insurance on life of X Rs.5,060/Medical insurance premium on the life of Xs brother who is not dependent upon X: 4,100/(the amount is reimbursed to X), Leave travel concession for X and his family: Rs. 46,500/(no journey is undertaken)
Salary-Example
Up to May 31, 2011, X has been paid house rent allowance of Rs.4,000/- per month(rent paid at Delhi : Rs. 4,000/- per month). With effect from June 1,2011, X has been provided a rent-free furnished house at Delhi whose lease rent is Rs. 15,000/- per month( rent of furniture provided with effect from September 15, 2011 :Rs. 20,000/-). Further A Ltd. Bears the expenses of repairs Rs.10,000/-
Salary-Example
Income of X from other sources is Rs. 6,00,000/- (which includes Government pension of Rs. 1,20,000/-) Find out the taxable income of X for the A.Y. 2012-13 on the assumption that Mr. X annually contributes Rs. 30,000/- towards P.F. and Rs. 20,000/- in public provident fund.
Salary-Example
X, posted at Ahmedabad, received following emoluments from his employer during the previous year 2012-13 :- Basic salary Rs. 80,000, salary in lieu of leave for the current year Rs.8,000, bonus Rs. 9,600, reimbursement of medical expenses Rs.6,000, entertainment allowance Rs.8,000, car provided by the employer Rs, 7000, electricity expenses borne by the employer Rs. 5,000 income-tax paid by the employer Rs.4,000 and special allowance 8,400. The employer provides a rent-free house (owned by the employer) whose particulars are : fair rent Rs. 86,400, salary of gardener Rs.4,800,house repairs Rs.11,000 Determine the value of the perquisite in respect of rent free house, if (a) X is a officer of the Government of Gujarat whose services have been lent to LIC, and accommodation to him has been allotted by the State Govt. and Rs.10,000 is the license fee of the accommodation occupied by X as per the Govts rules, (b) and X is the employee of PQR Ltd.
Salary-Example
Salary for the purpose of computing the value of rent-free accommodation is Rs. 1,14,000 (Basic-80,000+Salary in lieu of leave-8000 + Bonus-9600 +entertainment allowance-8000 + Special allowance-8400) If Mr.X is an officer of the Government of Gujarat and his services have been lent to LIC-Rs. 10,000 (being licence fee of the house as per the Governments rule) is the value of the perquisite. If Mr. X is an employee of PQR Ltd., then 15% of salary i.e. Rs. 17,100 (15% of 1,14,000) is taxable value of the perquisite.
Salary-Example
Mr.X an employee director has received following emoluments during the P.Y. 2012-13- Calculate the taxable income for the A.Y. 2013-14. Salary Rs.2,56,000, entertainment allowance Rs. 1,06,000, bonus Rs.1,11,200, education allowance Rs.2000 (for his grand children) Income-tax penalty paid by the employer Rs.1,500, Medical expenses reimbursed by the employer Rs. 15,000, leave travel concession Rs. 51,300, free residential telephone Rs. 13,000, reimbursement of gas bill Rs. 11,500, furnished house at concessional rate-lease rent of the house Rs. 1,60,800, cost of maintenance of garden (including salary of gardener) Rs. 2000, salary of two watchman Rs.11,000, salary of sweeper Rs. 6,200, rent of A.C. Rs.2,000, Cost of furniture Rs.18,000, Rent of furnished house paid to the employer Rs. 11,200, Car owned by
Salary-Example
the employer given partly for official and partly for private use (1900cc), payment of delegation fee to FICCI for attending 31st All India Conference of Corporate Managers and Tax Executives Rs. 52,000, employers contribution towards recognised provident fund Rs. 47,920,interest credited in P.F. A/c @ 14% Rs.14,000,Arrears of bonus of 2010-11 (not taxed earlier) Rs. 52,000,Mr.x is a retired Government employee. He gets a sum of Rs. 14,700 per month as pension from the Government. Professional tax paid by Mr.X Rs. 1,650