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ILLUSTRATION OF TOTAL INCOME & TAX LAIBILITY

Form the following income and expenditure Account of Dr. Kamble compute his total taxable
income for Assessment year 2015-16

Income and Expenditure account for the year ended 31-3-2015

Rs Rs

To Staff salaries 1,20,000 By Consulting Fees 4,00,000


To Dispensary Rent 67,500 By Visit Fees 1,00,000
To Dispensary Rent 60,000 By Gift from Patients 40,000
To Purchase of Medicines 45,000 By sale of Medicines at the 80,000
dispensary
To Income Tax 35,000 By Rent From House Property 1,20,000
To Professional Fees to 22,000
Doctors
To Car Expenses (For 36,400
Profession)
To Membership Fees 2,000
To Municipal Tax for Rental 12,000
House
To Interest on Housing Loan 18,000
For Rental House
To Printing Charges 4,000
To Depreciation 48,000
To Charity 1,500
To surplus of the year 2,68,600

Total 7,40,000 Total 7,40,000

Additional Information :-

1) Gifts from patients include Rs 1,000 from his father in personal capacity.

2) Depreciation as per Income Tax Rules Rs 45,000.

3) He paid medical Insurance premiums of Rs 8,000 by cheque.

4) He purchased National Saving Certificates of Rs 30,000 and paid Life Insurance premium of
Rs 60,000. (On a policy with capital sum assured amounting to Rs 12,00,000 issued on 1-4-
2011).

5) He paid Rs 20,000 to Nationalized Bank towards principal of Housing Loan.


Solution:-

Name Of Assesses:- Dr Kamble Status :- Individual

Previous Year :- 2014-15 Assessment Year :- 2015-16

Computation of Total Income Rs Rs Rs

A. INCOME FROM HOUSE PROPERTY


1) Net Annual Value (NAV)
(Rent from Lop) 1,20,000
2) Less:- Municipal Taxes (12,000)
1,08,000
3) Less:- Deductions u/s 24
a) Standard Deduction 32,400
b) Interest on Housing Loan 18,000 (54,400) 57,600

B.INCOME FROM PROFESSION


1) Net Surplus as per Income and Expenditure A/c 3,68,600
2) Add : Disallowances
a) Income Tax 35,000
b) Municipal taxes for Rental House 12,000
c) Interest on Housing Loan 18,000
d) Depreciation 48,000
e) Charity 1,500 1,14,500
4,83,100
3) Less:- Income consideration separately
a) Gift from father (Exempt) 1,000
b) Rent from House property 1,20,000 (1,21,000)
3,62,100
4) Less:- Depreciation as per l.t.Rules (45,000) 3,17,100

C. GROSS TOTAL INCOME (A+B) 3,74,700


D. DEDUCTION UNDER CHAPTER VIA
U/S80C:- NSC 30,000
LIP 60,000
Housing Loan principal 20,000
Qualifying Amount 1,10,000
Restricted to 1,10,000
U/S 80D : Medical Insurance Premium 8,000 (1,18,000)
E. NET TAXABLE INCOME (C-D) 2,56,700