Income-tax is the most significant direct tax. Entry 82 of the Union List i.e., List I of Seventh Schedule to Article 246 of the Constitution of India has given the power to Parliament to make laws on taxes on income other than agricultural income.


Components of income-tax law
• Income-tax Act, 1961 – governs the levy of income-tax in India.
• Income-tax Rules, 1962 – formulated for proper administration of the Act.
• Annual Finance Act – Amendments in the Income-tax Act, 1961 are effected every year through the Annual Finance Act.
• Circulars – issued by CBDT to clarify the meaning and scope of certain provisions of the Act.
• Notifications – issued to give effect to the provisions of the Act/ make or amend Rules.
• Case law decisions – interprets the various provisions of income-tax law.

😊Educational Updates

from tomorrow, We will start Taxation subtopic of UPSC Commerce Optional Paper 1.
For more info , Contact @cadhananjay

Income-tax is a TAX levied on the TOTAL INCOME of the PREVIOUS YEAR of every PERSON.

(1) Person: A person includes an individual, Hindu Undivided Family (HUF), Association of Persons (AOP), Body of Individuals (BOI), a firm, a company etc.

(2) Concept of Previous year (P.Y.) and Assessment Year (A.Y.): Previous year is the financial year immediately preceding the assessment year i.e., it is the financial year ending on 31st March, in which the income has accrued/received.
In case of a newly set-up business, the previous year would be the period beginning with the date of setting up of the business or profession or, as the case may be, the date on which the source of income newly came into existence, and ending on 31st March.

Assessment year (A.Y.): Assessment year means the period of twelve months commencing on the 1st April every year.
Exception to the rule that income is charged to income-tax in the Assessment Year following the previous year:

The income of an assessee for a previous year is charged to income-tax in the assessment year following the previous year. However, in the following cases, this rule does not apply and the income is taxed in the previous year in which it is earned.
(i) Shipping business of non-resident [Section 172]
(ii) Persons leaving India [Section 174]
(iii) AOP/BOI/Artificial Juridical Person formed for a particular event or purpose [Section 174A]
(iv) Persons likely to transfer property to avoid tax [Section 175]
(v) Discontinued business [Section 176]

Previous Year for Undisclosed Sources of Income: The following undisclosed source of income are charged to tax in the previous year in which they assessed by the Assessing Officer:
(i) Cash Credits [Section 68]
(ii) Unexplained Investments [Section 69]
(iii) Unexplained money etc. [Section 69A]
(iv) Amount of investments etc., not fully disclosed in the books of account [Section 69B]
(v) Unexplained expenditure [Section 69C]
(vi) Amount borrowed or repaid on hundi [Section 69D]
The above undisclosed incomes are chargeable to tax @78% [i.e., 60% plus
surcharge @25% plus cess @4%] as specified under section 115BBE.


(3) Total Income: Total income has to be computed as per the provisions contained in the Income-tax Act, 1961. The following steps has to be followed for computing the total income of an assessee:
Step 1 – Determination of residential status
Step 2 – Classification of income under different heads
Step 3 – Computation of income under each head after providing for permissible deductions/ exemptions
Step 4 – Clubbing of income of spouse, minor child etc. Step 5 – Set-off or carry forward and set-off of losses Step 6 – Computation of Gross Total Income
Step 7 – Deductions from Gross Total Income
Step 8 – Computation of Total income

👆🏻Above topics are related with Taxation subtopics of UPSC Commerce Optional

Rebate under section 87A: Rebate of up to Rs. 2,500 for resident individuals having total income of up to Rs. 3.5 lakh.

“Health and Education cess” on Income-tax: 4% of income-tax and surcharge, if applicable

👆🏻Above topics are related with Taxation subtopics of UPSC Commerce Option

Students appearing in UPSC Mains 2019 are suggested to participate in Taxation preparation and daily answer writing practice also.

for more info Contact @cadhananjay

Commerce Optional (UPSC-IAS),
Target for 16/07

👆Above are subtopic for Commerce Optional Paper 1 of Taxation


✅Income Tax: Definitions; Basis of Charge
✅



Note- Students are advised to read only that subtopics for UPSC commerce Optional Preparation.

Join 🔜 @commerceoptional

😊 This will be very useful for students of Commerce Optional.
For Guidance Purpose Contact
CA Dhananjay Ojha (Chartered Accountant)
Contact @cadhananjay

Commerce Optional (UPSC-IAS),
Target for 16/07

👆Above are subtopic for Commerce Optional Paper 1 of Taxation


✅✅



Note- Students are advised to read only that subtopics for UPSC commerce Optional Preparation.

Join 🔜 @commerceoptional

😊 This will be very useful for students of Commerce Optional.
For Guidance Purpose Contact CA Dhananjay Ojha (Chartered Accountant)
Contact @cadhananjay

✅Educational updates
Excel sheet of schedule of today study has been shared to students with study material.
Students are advised to make notes out of it.

With best regards
Civil Service Gurukul
@cadhananjay

Join🔜 @commerceoptional

Join🔜 @commerceoptional