GURUKUL FOR CA & CMA INCOME TAX SUMMARY 1

1. BASIC CHARGE 2. RESIDENTIAL STATUS

TAX RATES 1. Individual
1. Individual / HUF / AOP/ BOI / artificial person Basic conditions (Sec – 6(1))
Upto 2.5 L Nil (BEL) B1 : Stay in India during the P.Y. ≥ 182 days.
2.5 L to 5L 5% B2 : Stay in India during the P.Y. ≥ 60 days and 365 days (or)
5L to 10 L 20% more during the “4” preceding P.Y.
above 10 L 30% Additional conditions [Sec -6(6)]
2. Senior citizen + Resident A1 : He is a resident in India atleast 2 out of 10 Preceding P.Y
Upto 3L Nil (BEL) A2 : Stay in India 730 days (or) more days the “7” Preceding P.Y.
3L to 5L 5%
Y
5L to 10L 20% If B1 satisfied Resident If A1 + A2
above 10L 30%
3. Super senior citizen + Resident
N Y N Y
If B2
Upto 5L Nil (BEL) N
5L to 10L 20% R but not OR R & OR
NR
above 10L 30%
4. Firm (including – LLP) – 30%
Note: B2 condition not applicable.
5. Local authority – 30%
1. Indian Citizen who leaves India during the PY for the
6. Company
Domestic company + Turnover does not exceed 400 cr in PY 17-18 25%
purpose of employment (or) as a Crew of Indian Ship.
Other Domestic company 30% 2. Indian citizen / Indian original, who visit to India during the
Other than Domestic company 40% P.Y.
7. Co – Operative Society
Following period not included in No. of days stay India
Upto 10,000 10%
Starting: Date of Joining the Ship
10,000 to 20,000 20%
Ending: Date of signing off
above 20,000 30%
2. HUF
Rebate u/s 87A: -
If C&M wholly Y If Kartha
Resident Individual and total Income does not exceed 5,00,000. Resident
or partly in India R & OR
Amount of Rebate: - 12,500 (Max)
N NR
N Y
SURCHARGE
R but not OR R & OR
Total Income 3. Company
1cr to Above Indian company Resident
10 cr 10 cr
Foreign Company POEM in India  Resident
Firm/ co-operative society /local authority 12% 12%
POEM outside India  NR.
Domestic company 7% 12%
Foreign company 2% 5% 4. Other Person (firm / AOP / BOI)
Control & Wholly (or) Partly in India – Resident
Individual/HUF/AOP /BOI/AJP Management (C & M) Wholly outside India - NR
Total Income Surcharge Rate SEC. 5 (SCOPE OF TOTAL INCOME)
Up to 50 Lakhs. Nil Income Income Indian Income
> 50 Lakhs but not exceed 1 Cr. 10 % earned In or Received =
> 1 Cr. but not exceed 2 Cr. 15% Taxable in all cases
India In India
> 2 Cr but not exceed 5 Cr. 25%
> 5 Cr. 37% Income earned Income Received = Foreign
and
outside India outside India Income
Note: Surcharges rates of 25% and 37% not applicable for Income on account of Business control Taxable all cases
income covered U/Sec. 111A and U/Sec.112A from India. (or) Profession setup in India except (NR)
Other Income Taxable only (R & OR)

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 2
3. INCOME FROM SALARIES 6. Rent free Accommodation (RFA):
Charge of Salary: Any amount paid by employer to employee, Government Employee:-
then such amount is taxable u/h “IFS”. License fee determined by Employer XXX
Perquisites Non-Government Employee:-
1. Domestic Servant: House owned by House take on hire Accommodation in
= (Salary paid by employer – Amt recovered from employee) Employer Hotel
 D.S appointed by employer Taxable only in the hands of 15% / 10% / 7.5% Rent paid by employer Rent paid by employer
of Salary (or) 15 of Salary. (or) 2% of Salary
specified “Employee” Deduct amt. recovered from employee from above
 D.S appointed by employee Taxable in the hands of all
“Employer” Unfurnished RFA (UFRFA) xxx
2. Gas, Electricity (or) Water (+) 10% of Actual cost p.a (owned by employer) xxx
 Supplied from own Sources: (+) Hire charge paid (taken on hire by employer) xxx
(Manufacturing Cost to employer – Amt recovered from (-) Amt. recovered from Employee (xxx)
employee) FRFA xxx
 Supplied by procuring from outside agency
(Amt to agency by employer – amt recovered from employee) 7. Interest Free Loan:
Maximum Outstanding Monthly
Connection taken by Only specified employees [SBI Lending rate (-)
Balance(MOMB) on last day of X
employer: Actual Interest Rate]
each month
Connection taken by All Employees
employee: 8. Use of Movable Asset:
3. Education facilities in own institute (or) tie up Institute Computers/ Owned by Taken on hire
provided to children: Laptops employer
No Perquisite 10% Actual Cost Hire charges paid by
(Cost of such education in a similar Institution – Rs.1000 PMPC
p.a Employer
– Amt recovered from employee)
9. Sale of Movable Asset:
4. Medical facility to family:
Computers Car Other Assets
Family: Individual, Spouse, any children and dependent parents
Actual Cost xxx Actual Cost xxx Actual Cost xxx
to Individual, dependent brothers and sisters of an Individual. (-) Dep xxx (-) Dep xxx (-) Dep xxx
1. Employer own hospital 50% only 20% only 10% only
exempted

2. Govt. Hospital Completed Completed Completed

3. Approved by Chief Commissioner for prescribed diseases. Years (WDV) Years (WDV) Years (SLM)
4. Health Insurance premium. (-) amt (xxx) (-) amt (xxx) (-) amt (xxx)
recovered from recovered from recovered
Treatment outside India:
employee employee from
Medical & Stay expenses exempted: As permitted by RBI. employee
Travel Expenses: Exempted, if GTI does not Exceeds 2L. xxx xxx xxx xxx
5. CAR:
10. Travelling, Touring:- Total expenses paid by employer.
Car owned by employee & exp. Incurred by employer
Ofc. Private Both Office & Private
11. Free Food:
Nil Exp. Incurred by employer XXX Exp. Incurred by employer XXX a) Provided in remote area – Exempted
(-) Amt. recovered from Employee (XX) (-)1800 P.M/2400P.M (XXX)
b) Tea/Snacks in working hours – Exempted
XXX (-)900 P.M if driver Provided (XXX)
(-) Amt recod. from employee (XXX) c) Perquisites =
XXX [Cost to Employer (-) 50 Per Meal (-) amt. recovered from employee]
Car owned by employer & exp. Incurred by employee 12. Gift:
Ofc. Private Both Office & Private a) Cash Gift fully taxable
Nil 10% of actual cost p.a XXX 600 P.M (or) 900 P.M (+) 900 P.M, if
(-) Amt. recod. from Employee (XX) driver provided b) Gift in Kind  Upto 5000- Exempted
XXX 13. Credit card/ Club Expenditures:
Car owned by employer & exp. Incurred by employer  Official: Exempted
Ofc. Private Both Office & Private
Nil 10% of actual cost p.a XXX 1800 P.M (or) 2400 P.M (+) 900 P.M, if
 Personal: Taxable
(+) Exp. Incurred by employer XXX driver provided 14. Telephone perquisite exempted & telephone allowance
(-)Amt. received from Employee XXX taxable
XXX

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 3
ALLOWANCES d) Last drawn salary x remaining months of service
Section 10(14)(i) f) Provident Fund
1.Travelling Allowance 4.Helper Allowance RPF URPF SPF PPF
2.Daily Allowance 5.Academic Allowance ER Upto 12% of Not Taxable Exempted N.A
3.Conveyance Allowance 6.Uniform Allowance Contribution Salary
exempted
Exempted  Used for official purpose
EE 80C No - 80C 80C 80C
Contribution
Sec.10(14)(ii) Exemption Interest 9.5% p.a Not taxable Exempted Exempted
1.Tribal area Allowance Rs.200 P.M exempted
70% of allowance (or) 10,000 P.M Amount Exempted EE-contribution Not Exempted Exempted
2.Employee working in transport system
Withdrawn (Min. taxable
3.Education Allowance 100 PMPC (Max – 2)
service 5 ERcontribution IFS
4.Hostel Allowance 300 PMPC (Max – 2) years) Int on IFOS
5.Transport allowance (House to Office) 3200 P.M (Handicapped) EEcontribution
6.Under ground allowance 800 P.M Int on IFS
ERcontribution
HRA Exemption – 10(13A)
1.Max  50% (Metro’s) / 40% of Salary DEDUCTION U/S 16
2.Actual HRA Received Exempted a) Standard Deduction – Max - 40,000
3.Rent Paid (-) 10% of Salary b) Entertainment Allowances (Only Govt Employee)
(1) 5000 p.a (2) 20% of B.S (3) Amt recd. [Whichever is less]
RETIREMENT BENEFITS c) Professional Tax
a) Gratuity [Sec.10(10)]
Paid by Employee Paid by Employer
a) Govt. Employee – Fully Exempted
b) Non-Govt. Employee: Deduction First add to salary, then deduct u/s 16.
(i) Max  20 Lakhs Salary:
(ii) Actual Gratuity  XXX RFA Gratuity Covered All other Cases
(iii) Covered in Gratuity Act. under Act
15/26 X Last drawn X No. of Completed years Basic + DA (RB) + Bonus Basic + DA Basic + DA (RB) + %
salary (Part > 6 Months) + Commission + Fee + of Commission
Not Covered in Gratuity Act. Allowance + Other
½ X Avg. Salary X No. of Completed years Monitory Policy
b) Retrenchment Compensation [Sec.10(10B)] LTC- Exempted u/s 10(5)
a) Max – 5 lakhs  Travel expenditure paid by employer to employee exempted
b) Actual Amount (Twice in the block of “4” calendar years)
c) 15/26 X Avg. Salary of Last X No. of Completed  Max – 2 Children’s (born before 1.-10-1998 – No Limit)
3 Months years (Part > 6 M)
4. INCOME FROM HOUSE PROPERTY
c) Pension:
Conditions u/s 22
a) Un-commuted pension  Fully taxable
b) Commuted pension: 1. Property consists of Building (or) land appurtenant there to
(i) Govt. Employee – Fully Exempted 2. Assessee must be the owner of such property.
(ii) Non Govt Employees(Exempted) = 3. Property used for any purpose except Business (or) Profession of
1/3 Or 1/2 X Commuted Pension x 100 the assessee.
(Received (No Gratuity) % Commutation Computation of Income from House Property [LOP/DLOP]- [Sec -23(1)]
Gratuity) GAV xxx
d) Leave salary [Sec.10(10AA)] (-) Municipal tax paid by owner. (xxx)
a) Govt. Employee – Fully Exempted NAV xxx
b) Non-Govt. Employee – Exempted (-) S.D. @ 30% of NAV (xxx)
(i) Max – 3 Lakhs (-) Interest on borrowed capital (xxx)  (ND limit)
(ii) Actual Amount Income from House Property xxx
(iii) 10 x Avg. Salary Computation of GAV (LOP/DLOP) [Sec-23(1)]
Unavailed Leaves
Whichever is less Step-1:- M.V. (or) FR ↑
(iv) x Avg. salary
30
Step-2:- Value in step- 1 (or) SR ↓ = ER.
(Max Leaves – 30 days p.a.)
Step-3:- Compare ARR with ER.
e) VRC – [Sec.10(10C)]
1. ARR > ER  GAV = ARR
a) Max - 5 Lakhs
2. ARR < ER Not due to vacancy  GAV = ER
b) Actual Amount
3. ARR > ER due to vacancy  GAX = ARR
c) Last drawn salary x 3 months x completed years of service

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 4
Unrealised Rent allowed as deduction while computing ARR [Subject 2. Gift to Minor Child
to conditions] [Exception:- Transfer to Minor Married daughter]
SOP u/s 23 (2) 3. Holder of Impartibly estate.
NAV u/s 23 (2) Nil
4. Member of co-operative society is deemed owner even
(-) Interest on Capital (xxx)  Max
property registered in the name of co-operative society.
Borrowed [2,00,000/30,000]
5. Part performance of the contract as per Sec-53A of transfer
xxx
of property of property Act.
Interest on Borrowed Capital 6. Transfer of property by way of lease Not Less than 12 years
3 Conditions and. Rent paid for a period > 1 Year.
1. Loan taken for purchase / construction of H. P.
2. Taken on (or) after 1.4.1998 5. PGBP
3. Purchase/ construction completed within 5 years from the
end of F.Y. in which loan taken Sec-28: Charging Section
Max LOP/DLOP  No limit 1. PGBP carried on by assessee at any time during the P.Y.
SOP  ‘3’ conditions satisfied  2,00,000 2. Compensation:
SOP  any one/ all of ‘3’ conditions Not Satisfied  Termination (or) Modification
30,000
 Managing Agent agreement in relation to an Indian
Special note:
company (or) any company in India.
Interest limit of 2,00,000/30,000 applicable for all SOPs.
 In relation to agency in India.
Computation of Interest on Borrowed capital for P.Y.  Any contract relating to business.
1. Current year Interest xxx Vesting of management of property or business with
2. PCP Interest Installment xxx Government/Corporation.
(a) PCP = starting:- Date of borrowed 3. Income received by trade (or) professional association from
st
ending:- Previous 31 March. service to its members.
(b) PCP Interest = loan x PCP x Interest Rate 4. Profit on sale of import license, duty drawback, cash
PCP Int
(c) PCP Interest Installment = assistance against exports.
5
xxxx 5. Value of Benefit or Perquisites.
Sec -25A:- 6. Interest/salary/Bonus etc. received by partner from
1. Recovery of unrealised rent (or) arrears of rent received is partnership firm.
taxable in the P.Y. in which such amount received U/H 7. Amt received under non-competency agreement.
Income from House Property even assessee is not a owner 8. Amt received under KIP.
in that F.Y.
Sec-29: Income referred to in sec-28 has to be computed in
2. Standard deduction @30% of such amount.
accordance with the provisions contained u/s 30 to 43D.
Special treatments. Sec-30: Rent, tax repairs (Not capital repairs), Insurance for
1. Sec-23(3):-Part of period S.O & Part of period Let out [Compute Building.
IFHP as per Sec-23(1)]
2. Sec-23(4):- More than two SOP Sec-31: Repairs, Rent, Insurance for P&M, F&F.
Two H.P SOP [as opted by assessee]
Sec-32: Depreciation
Reminding H.P.  DLOP [Compute GAV as per Sec -23 (1)]
1. Depreciation in compulsory
3. Part House property S.O.P & Part House property LOP
SOP Part  NAV = Nil 2. P&M excludes live stock, tea bushes.
LOP Part Compute GAV as per 23(1) 3. 50% of Normal depreciation:
4. House Property is stock in trade and not be LOP [Sec -23 (5)] Asset acquired during the P.Y and put to use less than – 180 days
NAV = Nil [One Year from the end of FY in which 4. Conditions for claiming depreciation:
completion certificate issued.] a) Assessee must be owner of the asset.
b) Asset must be used for Business (or) profession.
Deemed owner [Sec-27]
[Active use or Passive use]
1. Gift to spouse by Individual & Individual is deemed owner. 5. Depreciation u/s 32 computed under Block of assets method.
Exception:-transfer of House property in case of agreement 6. Block = Same Kind + Same Rate
to live apart.

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 5
7. Computation of Closing WDV Payment for acquisition of asset:
Opening.WDV as 01-04-2018 XXX If payment (or) aggregate of payment in a day to a person >
(+) Additions (Assets purchased during the P.Y) XXX 10,000 other than a/c payee cheque, a/c payee Bank draft or
(-) Sale Proceeds (XXX) use of ECS, then such expenditure not included in Actual Cost.
Depreciable Value XXX Depreciation in case of power sector units:
(-) Depreciation (XXX) 1. PSU can claim depreciation on single assets under SLM.
Closing WDV as on 31-03-2019 XXX 2. Option to claim dep. under WDV, on or before due date u/s
8. Rates of Depreciation 139(1) in the year in which begin to generate power.
Building 3. Sale of asset in year of first use: Resulting STCG/STCL.
(a) Used for residential purposes 5% 4. Sale of asset in subsequent years
Net Consideration < WDV Terminal depreciation =
(b) Used other than residential purposes 10%
[WDV – NC]
(c) Temporary Wooden Structures 40% NC > WDV & also > greater than 1. STCG = [NC – OC]
Furniture and Fittings 10% Original Cost(OC) 2. Balancing Charge u/s 41(2)
P&M = (OC – WDV)
NC > WDV but not greater than Balancing Charge
(a) General Rule 15%
Original Cost = [SC – WDV]
(b) Motor car, Motor Lorries, Motor taxis used in 30%
Business of running on hire. Investment Allowance for New P&M u/s 32AD @ 15% of Investment
(c) Normal Motor Car 15%
a) Applicability:-Manufacturing unit setup in notified
(d) Air Control/Water control pollution equipments 40%
backward areas in A.P/T.S/Bihar/West Bengal during the
(e) Computer including computer software; books 40% st st
period b/w 1 April-2015 and 31 March 2020.
(f) Ships 20%
b) If new asset transferred within 5 years from the date of its
Intangible Assets 25%
installation, then amt of deduction previously claimed as
Actual Cost:
deduction shall be taxable in the P.Y transfer.
Mode of Acquisition Actual Cost
1. Asset acquired for scientific Actual cost less Following P&M ineligible for additional depreciation [20% or
research subsequently deduction availed u/s.
35%] and investment allowance u/s 32AD:
brought into business use 35.(Nil)
1. Ships, Aircrafts, Road transport vehicle.
2. Asset acquired from any Actual cost determined
other person using the asset by the assessing officer 2. Second hand P&M, office appliance including computer (or)
for his business/ profession with the prior approval of computer software.
with a view to claim the deputy 3. P&M installed in office or residential accommodation or
enhanced depreciation. commissioner. Guest House
3. Asset transferred by the The WDV at the time of 4. 100% of cost of P&M allowed as deduction. (Either
assessee and reacquired by original transfer or the depreciation or otherwise)
him. price paid for reacquiring
Additional Depreciation @ 20%
the asset, whichever is
1. Applicability:- Manufacture of goods / generation,
less.
4. Building used for private The cost of the building transmission or distribution of power.
purpose subsequently as reduced by the 2. Eligible Asset: New P&M
brought into business use. notional depreciation 3. Rate: 20% of Actual Cost
calculated up to the year 4. Put to use less than 180 days:-
of bringing the asset to st
[1 year of acquisition – 10% & Next P.Y-10%]
business at the rate
Additional Depreciation @ 35%
applicable to that year.
1. Applicability:- Manufacturing unit in notified backward
5. Asset acquired out of Interest up to the date
borrowed funds. the asset is first put to areas of A.P/T.S/Bihar/West bengal during the period b/w
st st
use. 1 April 2015 & 31 March 2020.
6. Subsidy or grant or Such subsidy etc. shall be 2. Rate: 35% of Actual Cost
reimbursement received reduced from cost. 3. Put to use less than 180 days:-
from govt. st
[1 year of acquisition – 17.5% & Next P.Y-17.5%]

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GURUKUL FOR CA & CMA
Proportionate Depreciation:
Step-1: Depreciation shall be calculated as if the succession or
amalgamation or demerger has not taken place.
Step-2: Computed depreciation shall be apportioned b/w the
predecessor and successor in the ratio of number of days for
which the assets were used by them.
Unabsorbed depreciation [UAD] – [Sec.32(2)]
1. UAD arised due to no profits or profits or gains from
business or profession less than depreciation.
2. UAD can be S/F from any other head of income expect
salary.
3. UAD can be C/F indefinitely.
4. Order of Set-off:-
CY Depreciation  B/F Business Loss  UAD
Sec-35: Expenditure on Scientific Research
Part-A:- In house Research [Self spending]
Research before commencement of Business
INCOME TAX SUMMARY 6
“Investment – linked tax Incentives” for specified Business 35AD
100% of Capital expenditure allowed as deduction for following
Business:
[Capital Expenditure excludes land, goodwill, Financial Instruments]
1. Cold Chain Facilities.
2. Warehousing for agricultural produce.
3. Cross Country natural gas/crude/petroleum oil pipeline.
4. Hotel of two star or above
5. Hospital {Min – 100 beds)
6. Housing project under slum redevelopment.
7. Housing project under affordable housing
8. Production of fertilizer
9. Inland container depot/Container freight station.
10. Bee- keeping/production of hone/bees wax.
11. Warehouse for sugar
12. Slurry pipeline for the transportation of iron ore.
13. Semi-Conductor, Wafer, Fabrication unit.
14. Developing, maintaining and operating New Infrastructure
facility.

[Max – 3 years before] If asset transfer to non-specified Business within 8 years

Rev. Exp Salary [Excluding perks] – 100% Total deduction u/s 35AD XXX
Other Expenditure – No Deduction. (-) Deprecation u/s 32, if sec-35AD not available (XXX)
Taxable U/H PGBP XXX
Capital Exp. Land – Not Allowed
If asset transferred (i.e. Sold) after claiming deduction u/s 35AD,
Other Capital Exp.  100% then total amt received taxable U/H PGBP [Sec.28]

Research after commencement of Business: Section-35CCC: 150% of expenditure incurred on agricultural

Assessee:- Rev-Exp: 150% extension project allowed as deduction.
Company in Manufacturing Capital Exp.:
Section-35CCD: 150% of expenditure incurred (other than land
[Approved – 35(2AB)] Land – Nil
or building) by company on any notified skill development
Building – 100% project allowed as deduction.
Other Capital Exp. – 150%
Section-35CCA: Contribution to-
Other Person:- 100% Deduction for all revenue & capital
a) Institution for implementation of rural development
expenditure [Except – Land]
programmes.
Part-B:- Contributions to Others b) National Fund for rural development.
To approved, Research association, Institute, College, University: c) National urban poverty eradication fund.
For Scientific Research  150%
For Social & Statistical Research  100% Section-35D: - Preliminary Expenditure
1. Max Deduction:- Company
To IIT, National laboratory
5% of Cost of Project or XXX
For Scientific Research  150% 5% of Capital employed XXX
To approved Indian Company Others:5% of cost of project
Engaged in R&D  100% 2. Preliminary Expenditure allowed as deduction in 5 equal annual
Transfer of asset after claiming deduction u/s. 35 installments
a) If amt realized > amt of deduction Other Deductions u/s 36(1):
1. Insurance premium paid in respect of stock or stores etc.
To the extent of deduction u/s 35  PGBP
2. Medical Insurance premium in respect of employees other
Excess amt over and above the deduction u/s 35  Capital Gains
than cash.
b) If amt realized < amt of deduction 3. Bonus or Commission paid to employees [Subject to 43B]
Total amt realized shall be taxable U/H PGBP. 4. Interest on capital borrowed. [Subject to 43B]

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 7
5. Discount [Face value – issue price] on ZCB allowed as General Deduction u/s 37(1)
deduction on pro rata basis having regard to period of life of Expenditure allowed as deduction if following conditions are
such bonds. satisfied:
6. Contributions to welfare funds of employee (i.e. RPF, 1. Expenditure not covered in Sec.30 to 36
Recognized super annuity fund, approved gratuity fund) 2. Not a capital expenditure.
Contribution by employer Allowed as deduction to 3. Exclusively for business or profession purpose.
(Own pocket) employer if payment made on 4. Such expenditure not incurred for offence. (i.e. penalty)
or before due date u/s 139(1) 5. Such expenditure not incurred by assessee as a part of CSR
Contribution by employer Such amt Income to XXX activities.
which is collected from employer at the time of 6. Such expenditure not personal
employee receipt u/s 2(24) Sec.37(2B): Any expenditure incurred for advertisement in any
(-) allowed as deduction XXX souvenir/brochure/pamphlet etc published by a political party
u/s 36(1) if payment is not allowed as deduction.
made by employer to However such expenditure is treated as donation to political
respective funds on or party and allowed as deduction u/s 80GGB/80GGC.
before due date Disallowable expenditure:
Due date:- Due date u/s 139(1) XXX Sec.40(a)(i): Amt paid to person outside India or Non-resident
or foreign company and
7. Bad debts allowed as deduction, if following conditions TDS not deduction during the PY or
satisfied u/s36(1): TDS deducted during the P.Y but not paid to govt. on or before
a) The debt should be incidental to business or profession. due date u/s 139(1),
b) Such debt should be taken into account in computing Then 100% of such expenditure not allowed as deduction
the income of assessee. [above condition not applicable during the PY.
if debt represent money lent in the course of banking or Sec.40(a)(ia): Amt paid to resident and TDS required to deduct
money lending business] on such payment but
c) Mere provision is not sufficient but actual written off of TDS not deducted during the PY or
TDS deducted during the PY but not paid to govt. on or before due
account is required.
date u/s 139(1).
d) The business or profession must be in continuation.
Then 30% of such expenditure not allowed as deduction during the
8. Recovery of bad debts is taxable in the PY in which bad
PY.
debts recovered. Rectification [40(a)(i)/40(a)(ia)]:
9. If debt has been included in income computation based on If TDS deducted in subsequent PY or
ICDS without recording same in books of accounts & TDS deducted in PY paid to Govt. after due date u/s 139(1)
subsequently such debt become irrecoverable, then such Then (100% - NR) (30% Resident) of expenditure allowed as
debt allowed as deduction in the P.Y in which it become deduction in the PY in which TDS paid to Govt.
irrecoverable and it shall deemed that such amt has been Sec.40(a)(ii):
written off in the accounts. 1. Income tax paid not allowed as deduction, and refund of
10. Exp. On purchase of animals allowed as deduction in the PY Income tax not taxable
in which such animals die or become useless. [Sale proceeds 2. Interest on Income tax refund is taxable U/H IFOS.
of car cases, reduced from amt of deduction.] Sec.40(a)(v):Tax paid by employer on non-monetary perquisites
11. Family planning expenditure:(for company)  not allowed as deduction to employer.
a) Revenue Expenditure  100% Sec-40(b): Interest paid to partners by firm allowed as deduction
b) Capital Expenditure  5 installments if following conditions satisfied:-
c) Unabsorbed expenditure on family planning treatment 1. It should be authorized by partnership deed.
2. Prospectively only
same as UAD.
3. Max- 12% p.a
12. STT paid
Remuneration paid to partner [Subject to Conditions]
Securities held as Allowed as deduction u/s 36(1)
STT 1. It should be authorized by partnership deed.
Securities held as Not allowed as deduction while computing 2. Prospectively only
Investment(C.A) capital gain 3. It should be paid to working partners

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 8
4. Max:-
Sec.43B: Following expenditure allowed as deduction only if
Book Profit Remuneration
payment made on or before the due date u/s 139(1).
Upto 3L 1,50,000 or 90% of B.P
1. Tax, duty, cess
On Balance 60% of B.P
2. Contribution to PF or gratuity Fund or any other Fund of
Book Profit: means nothing but profit calculated under the employee.
head “PGBP” after making all adjustments before allowing
3. Bonus or commission to employee.
deduction for remuneration paid to partners.
4. Interest on loan or advance from financial
institutions/Scheduled bank/NBFC.
Sec.40A(2): Payment made to related person or entity  to the
extent which is excessive or unreasonable not allowed as 5. Leave salary to employers
deduction. 6. Sum payable to Indian Railways for use of railway assets.
Note:
Sec.40A(3): 1. Above expenditure not allowed as deduction during the PY
Expenditure incurred during the PY if payment not made within the time limit u/s 139(1).
However, such expenditure allowed as deduction in
subsequent PY in which payment made.
And payment in respect of such expenditure 2. Mere conversion of interest into loan is not treated as
made to a person in a day payment.
Tax Audit u/s 44AB:
Business  Total Sales / Turnover > 1cr
> 10,000 Not exceeds 10,000
Profession  Gross receipts > 50 L

a/c payee cheque, Other modes Allowed as Maintenance of Books of accounts u/s 44AA:
a/c payee DD, deduction (any Notified Professions:- Required to maintain books of accounts
ECS mode of
payment)
if gross receipts during all ‘3’ preceding P.Y exceeds
NO deduction
Rs.1,50,000.
Allowed as Business/Profession in any one of Individual/ Other
deduction
‘3’ preceding PY exceeds HUF assessee
Income from Business/Profession 2,50,000 1,20,000
Note: Payment made to transport operator  enhanced limit Turnover 25,00,000 10,00,000
35,000 applicable.
Sec-44 AD:
Sec.40A(3A): 1. Applicability:-
a) Resident Individual, HUF, Partnership firm
Expenditure allowed during the PY on accrual basis and payment is made
Zz b) All Business
in subsequent P.Y’s *Payment in a day to a person+
c) Turnover does not exceed Rs.200 L
2. Sec-44AD is not applicable:
> 10,000 Does not exceeds 10,000
a) Person carrying on profession
b) Person earning Income in the nature of commission or
a/c payee cheque Other modes No tax treatment brokerage
a/c payee DD c) Agency Business
ECS
3. Presumptive Income”:
Taxable U/H PGBP
8% of Turnover or
No Tax treatment
6% of total turnover or gross receipts if amt received a/c
Note: Payment to transport operator  enhanced limit of payee cheque or a/c payee DD or ECS on or before due date
35,000 applicable. u/s 139(1)

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 9
4. Sec.44AD(4): If assessee eligible for 44AD(1), but assessee 4. Conversion of capital asset into SIT
not opted presumptive taxation u/s 44AD during the PY 5. Redemption of ZCB
then next “5” PY assessee not eligible for 44AD. 6. Part-performance of contract u/s 53A of transfer of
Sec.44 AE: property Act.
1. Applicability:- assessee must be engaged in the business of 7. Certain transactions which have effect of transfer of
plying, hiring or leasing “goods carriage”. Immovable property.
2. Assessee should not owner more than 10 vehicles at any LTCA & STCA:
time during the PY. LTCA
3. Income: Period of Holding > 12 Months
Heavy goods Rs.1000 per tonne of gross vehicle weight for 1. Listed Securities
vehicle month or part of Month 2. Units of UTI
Other 7500 P.M.P.V 3. Units of EOMF
Vehicle 4. ZCB
Heavy goods vehicle = gross weight of vehicle > 12000 kgs POH > 24 Months
1. Unlisted Shares
Sec.44ADA:
2. Land or Building or Both
1. Applicable to resident assessee engaged in notified
profession u/s 44AA and gross receipts > 50L Other capital assets > 36 Months
2. Income = 50% of Gross Receipts Note:- STCA = Other than LTCA

Common Points [Sec.-44AD, 44AE & 44 ADA]

Conversion of COA to ICOA
 No further deduction u/s 30 to 38
1. Capital asset acquired before 1.4.2001
 Depreciation u/s 32 not allowed but WDV of asset are
reduced as if depreciation allowed. FMV as on 1.4.2001 or CII in the year of transfer
X
 Sec.44AA & Sec.44AB not applicable. COA 100
 Chapter VI deductions and S/F of losses available.
2. Capital Asset acquired on or after 1.4.2001

6. CAPITAL GAINS CO CII in the year of transfer

X CII for the year in which asset first held by assessee
Sec-45(1): Charging Section:- Any profit or gain from A
transfer of capital asset shall be taxable U/H C.G in the PY
in which transfer took place. Conversion of COI to ICOI
CII in the year of transfer
Sec-2(14) Capital Asset means: 1. COA X
CII for the year in which the improvement took place
1. Any property(Whether or not used for Business or
Profession) 2. COI incurred before 1.4.2001  Ignore
2. Include any securities held by foreign institutional Note:
Investor. Option-1: Previous owner Option-2: Previous owner
3. Excludes: holding period ignored for holding period considered for
a) Stock in trade (RM/WIP/F.G)
Indexation Indexation purpose
b) Movable personal property but excludes jewellery,
Computation of C.G u/s 48 [Non-depreciable assets]
drawings, paintings, Sculpture, Archaeological
collection or any work of art. Sale Consideration Xxx
c) Rural Agricultural land in India. (-) Transfer expenditure Xxx
d) Gold Deposit Bonds/ Deposit Certificates. Net Sale Consideration Xxx
(-) ICOA Xxx
Sec.-2(47): Transfer includes
(-) ICOI Xxx
1. Sale, exchange, relinquishment
LTCG Xxx
2. Extinguishment of any right
(-) Exemption u/s 54 Xxx
3. Compulsory acquisition under any law
Net LTCG Xxx

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 10
Note:- Sec-45(5A):
1. Indexation not applicable while computing STCG Capital gain in case of Joint development agreement (JDA)
2. STT paid not allowed as deduction 1. Year of Transfer:- [I/HUF]: PY in which completion
3. Indexation not applicable for Bonds, debentures & LTCG certificate issued by competent authority
u/s 112A. However, indexation applicable for capital 2. FVC: SDV on the date of issue of CC of his share in project +
Indexed bonds & Sovereign gold bonds. Consideration in cash
3. COA of share received in JDA: Amt FVC u/s 45(5A)
Comparison of Sec.32 & Sec-50
4. Sec.45(5A) not applicable, if assessee transfer his share in
If there is a asset in the Y project on or before the date of issue of CC
Sec.32
N Block + Value in the Block Section 45(3): Transfer of Capital Asset by Partner to
Partnership Firm (Member to AOP/BOI)
STCG  SC > op. WDV + Additions  Capital gain is applicable in hands of partner/member
Sec.50 STCL  SC < op. WDV + Additions
 FVOC = Amount recorded in Books of Firm
Section 45(4): Transfer of Capital Asset by Firm to Partner
Sec.45(1A): Compensation from Insurance Company (AOP/BOI to Member)
1. Year of Chargeability:- PY in which compensation or asset  Capital Gain is applicable in hands of FIRM/AOP/BOI
received.  FVOC =FMV as on date of transfer
2. Consideration:- [Value of Money + FMV of asset received] Exemption u/s 10(37)
3. Indexation available upto the year of destruction Individual or HUF + Urban agriculture land + Used for agricultural
purpose for 2 years by Individual or parents or Members of HUF +
Sec.45(2): Conversion of capital asset into SIT
Compulsorily acquired under law
1. Both capital gain and PGBP taxable in the P.Y in which SIT is
sold. Tax Rates for STCG:
2. STCG u/s 111A taxable at 15%: Transfer of listed equity shares
Capital Gain PGBP or units of EOMF or units of Business TRUST and STT paid on
FVC = FMV of asset on XXX Sale price of SIT XXX transfer.
Conversion 1. Other STCG: Taxable at normal Rates
(-) COA/ICOA (XXX) (-) FMV on the date of XXX Tax Rates for LTCG:
conversion LTCG u/s 112A taxable at 10% on LTCG on exceeding 1,00,000
C.G XXX XXX [No Indexation]
a) Transfer of equity shares if STT paid both acquisition and
3. Indexation upto conversion
transfer.
Sec-45(5):- Compensation on compulsory acquisition under b) Transfer of Units of EOMF or units of Business TRUST and
law STT paid on transfer.
st
Cost of Acquisition u/s 112A [If asset purchased before 1 Feb 2018
Initial Compensation:
st
1. Year of taxability:- PY in which compensation received(Full Step 1: FVC of shares or FMV on 31 jan 2018
or Part) Step 2: Value in Step 1 or COA
2. FVC = Total Compensation determined Sec-112:
3. Indexation available upto the year of acquisition LTCA Tax Rate
Unlisted Securities or Non resident/Foreign Company
Enhanced Compensation:
10% Without Indexation
1. Enhanced Compensation is taxable in the year of Receipt. Shares of Private Company
Listed Securities or ZCB 10%  Without Indexation or
2. COA/COI = Nil
20%  With Indexation
3. Litigation expenses allowed as deduction.
Which is beneficial to assessee
Other LTCA 20%

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 11

Note: e) Transfer of shares by share holder in the scheme of

1. Individual/HUF: LTCG u/s 112A, 112 or STCG u/s 111A shall amalgamation.

be reduced by unexhausted basic exemption limit f) Transfer of C.A from demerged company to resulting

2. No Chapter VI A deduction for LTCG u/s 112A, 112 or STCG company

u/s 111A g) Issue of shares by resulting company to demerged company

3. Rebate u/s 87A not applicable for LTCG u/s 112A
Sec-50B:- Slump Sale
1. If undertaking held for more than 36 months then resulting
capital is LTCG [But no Indexation]
2. COA + COI = Net Worth
a) Net Worth = [Total Value of Assets – Value of liabilities
(Book Value)]
b) In case of depreciable asset:- WDV as per Income tax
c) In case of Non depreciable asset: Book Value
d) Ignore revaluation effect
share holders.
h) Transfer of CA by partnership firm/ proprietary concern to
company.
i) Conversion of debentures to shares
Note:- Applicable for above transactions
1. COA u/s 49(1)= COA to previous owner.
2. Period of holding 2(42A) = Previous owner holding period
also included
Reverse Mortgage Scheme:
1. Transfer of C.A under Reverse Mortgage Scheme not a

Sec-50C:- Full Value of Consideration = SDV transfer u/s 47.

1. Capital Asset = Land or Building or both 2. Amt received by senior citizen as loan either in lump sum or

2. If 105% of S.C < SDV  FVC = SDV installment is exempted u/s 10(43)

If 105% of S.C ≥ SDV  FVC = S.C

Sovereign Gold Bonds(SGB):
3. SDV of on the date of agreement applicable if advance paid
1. Redemption of SGB not a transfer u/s 47
on or before date of agreement by way of a/c payee cheque
2. Indexation available on SGB
or A/c payee DD or ECS
4. If assessing officer refer case to valuation officer(V.O)
Value by V.O > SDV FVC = SDV
Value by V.O < SDV FVC = Value determined by V.O

Sec-43CA: Land or Building or Both = Stock in trade

[Same as 50C]

Sec-50D: If consideration not determinable then

FVC = FMC of asset on the date of transfer.

Sec-50CA: Sale Consideration of unlisted shares less than FMV

of share, then FVC = FMC of share.

Exemptions
Sec-47: Following transactions not treated as transfer
a) Distribution of C.A by HUF to members on partition.
b) Capital Asset as a gift/will/irrecoverable TRUST
c) Transfer C.A b/w holding company & 100% of subsidiary
company.
d) Transfer of C.A from amalgamating company to
amalgamated company.

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 12
Exemptions
Transfer of asset
Lock in
Applicability Old asset New asset Time limit Exemption amt within lock in CGAS
period
period
Purchase before 1
CG > 2 Cr. – 1 RHP year or after 2 C.G or amt of
Sec.54 I/HUF RHP + LTCA 3 years 
CG ≤ 2 Cr. – 2 RHP years  investment
Construction – 3 yrs
Amt of CG
Agricultural previously
UAL + 2Yrs used for C.G or amt of
Sec.54B I/HUF land (UAL or 2 years 3 years exempted shall 
agricultural Purpose investment
RAL) be from COA of
Land or Building + new asset
Compulsory Land or Building
Any C.G or amt of
Sec.54D acquisition + 2 yrs for Industrial 3 years 3 years 
assessee investment
used for Industrial under taking
under taking
C.G or amt of
Any Land or Building + Bonds of NHAI investment.
Sec.54EC 6 Months 5 years X
assessee LTCA or RECL Note: Max Invt
Amt C.G
– 50L
previously
C.G or amt of
exempted taxable
Any investment.
Sec.54EE Any LTCA Notified units 6 Months 3 years in the year of X
assessee Note: Max Invt
transfer
– 50L
Any LTCA other than Amt invt.
Sec.54F I/HUF One RHP India Same as Sec.54 CG x 3 years 
RHP NSP

Note: Rights Shares - COA

1. Sec.54F: Assesee should not own more than one residential Original shares (which forms Amount actually paid for
house on the date of transfer. the basis of entitlement of acquiring the original
rights shares). shares.
2. Non- utilization of balance in capital gain A/c scheme. Rights entitlement (which is Nil.
renounced by the assessee in
a) Amount deposited is not utilized wholly or partly for
favour of a person).
specified purpose in specified time
Rights shares acquired by the Amount actually paid for
b) Amount not so utilized is taxable as capital gain of P.Y. in
assessee. acquiring the rights shares.
which specified time expires.
Rights shares which are Purchase price paid to the
3. Section 54H: Extension of time for acquiring new asset purchased by the person in renouncer of rights
whose favour the assessee entitlement as well as the
Where transfer of capital asset is by compulsory acquisition
has renounced the rights amount paid to the
under any law, then, Time limits for acquiring new assets & for
entitlement. company which has allotted
depositing in CGAS shall be computed from date of receipt of
the rights shares.
compensation & not from the date of compulsory acquisition.
Bonus Shares – COA
Sec.49(5):- COA = FMV of asset which is declared under If bonus shares are allotted Fair Market Value on 1.4.2001.
before 1.4.2001.
Income declaration scheme-2016 on the date of
If bonus shares are allotted Nil.
commencement of Scheme.
on or after 1.4.2001.
ESOP’s:- Goodwill of Business, Trademark, Brand Name etc., - COA
1. Perquisite u/s 17 = [FMV of share as on the date of excise [Sec. 55]
Self-Generated. Nil.
of option – amt recovered from employee]
Acquired from previous owner. Purchase price.
2. COA for subsequent sale of ESOP’s = FMV which is taken for
The cost of improvement of such assets would be Nil. [For sale
calculation of perquisite u/s 17.
of Goodwill of profession Sec.55 is not applicable]

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 13
Gift Not Taxable:-
7. INCOME FROM OTHER SOURCES
Received from relative, Marriage Inheritance, In contemplation
1. Dividend:
of death of payer, Local authority, Institute u/s 10 (23c),
2 (22)(a):- Distribution of assets by company.
TRUST u/s 12AA.
2(22)(b):- Distribution of debentures to share holders and
COA u/s 49 (4):-
issue of Bonus Shares to preference share
FMV / SDV which is used for calculation of gift u/s 56 (2)(x).
holders.
2(22)(c):- Distribution of assets on liquidation. 3.
2(22)(d):- Distribution on reduction of capital.
(a) Interest on compensation taxable in the P.Y in which such
2(22)(e): Loan (or) advance by private company (or)
amount received U/H Income from other source.
Unlimited company to S.H. who owns 10% (or)
(b) Assets can claim S.D. @ 50% u/s 57
more voting power (or) any concern in which
4. Casual Income:- Taxable @ 30% u/s 115 BB. [No deduction,
S.H having substantial Interest.
No BEL, No S/F & C/F]
2 (22) (a)(b)(c)(d)(e) 5. Forfeiture of advance
Before 1.4.2014 On (or) after 1.4.2014
Deemed dividend to the extent of Accumulated profits  Reduced from COA/FMV/WDV Taxable U/H Income from
(Capitalised (or) Not) [Sec-51] other source in the P.Y. in
 A.F by Previous owner -ignore which such A.F.
Taxation of dividend 6. Family pension taxable U/H Income from other sources &
A. Foreign company:- Taxable in the hands of S.H U/H Income eligible for deduction of 15,000 (or) 1/3 of pension ↓
from other sources. Distribution of assets by company to Share holder at the time
B. Deemed dividend u/s 2 (22) (e):- Company liable to pay of liquidation (Sec 46)
DDT u/s 115-0 @ 30% & exempted in the hands of SH u/s 10 Tax implication in the hands of Company
(34). 1. Distribution of assets by company to share holder at the
C. Dividend & Deemed dividend u/s 2 (22) (a) (b) (c) (d) time of liquidation is not a transfer u/s 46(1)(No CG)
(i) Company liable to pay DDT u/s 115 –0 @15%. 2. Sec.2(22)(C): Distribution of assets by company to
(ii) S.H = Domestic Company (or) Institution u/s 10 (23C) shareholder at the time of liquidation is deemed dividend to
(or) TRUST u/s 12AA  exempted u/s 10 (34) the extent of Accumulated Profits.
(iii) S.H. = Others:- [Dividend upto -10,00,000 exempted  Company is liable to pay DDT u/s 115 – 0
u/s 10 (34)] [Total dividend – 10,00,000] x 10%  u/s
Tax implication in the hands of Shareholder
115 BBDA 10% tax payable at gross basis, without
Computation of Capital Gain
deductions. FVC = (FMV of assets received + Cash)
2. Gift u/s 56 (2) (x):- any person as a capital asset. -Deemed dividend U/S 29(22) (C) (XXX)
Cash Amount received during the Net Sale Consideration XXX
P.Y > 50,000 TV = Total gift amount -COA/ ICOA of shares (XXX)
Movable Property FMV > 50K  then TV = FMV CG XXX
(Full gift)
Movable Property (FMV − SC) > 50K  then TV = (FMV - 8. CLUBBING OF INCOME
(Part gift) SC) 1. Sec -60:- Transfer of Income without transfer of asset, then
Movable Property Securities, Jewellery, Archaeological such Income taxable in the hands of transferor.
collection, Painting, Drawings, Sculpture, 2. Revocable Transfer:-
any work of art, bullion (a) Revocable during the life time of transferee, then
IMP (Full gift)  SDV > 50K, then, TV = SDV Income on such asset taxable in the hands of transferor.
(land (or) Building) (b) Not revocable during the life time of transferee, then
IMP (Part gift)  (SDV - SC) > 50K & 5% of S.C clubbing provisions not applicable [i.e. taxable in the
then TV = SDV - SC hands of transferee]

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 14

3. Income received by spouse by way of remuneration from Tax liability in case of composite Income.
concern in which the Individual has substantial Interest. Activity Business Income
(A) Manufacture of rubber 35%
(i) Spouse not having technical (or) professional knowledge Manufacture of coffee or 25%
 taxable in the hands of Individual [grown & cured]
(ii) Spouse having technical (or) professional knowledge  Manufacture of coffee – grown, cured, 40%
roasted and grounded.
clubbing provisions not applicable.
Manufacture tea 40%
(B) Where Both has band and wife having substantial
Interest and Receipt of Income byway of salary etc, then Sale of agriculture product after process (such process is
Income will be taxable in the hands of person whose optional for sale).
total income is higher (excluding such salary Income). Agriculture Income Business Income
4. FMV of agriculture xxx Sale price of final product xxx
(a) Gift to spouse (except house property) Income on product
(-)Cultivation expenses (xxx) (-) FMV of agriculture (xxx)
Exception:- T/F of property in case of such
product
agreement to live apart property (-) Cost of Manufacture (xxx)
(b) Gift to any person/AOP for the benefit (i.e. gift) is xxx xxx
of spouse taxable in
(c) Gift to Son’s wife the hands of Partial Integration of Agriculture Income (AI) with Non
Agriculture Income.
(d) Gift to any person/ AOP for the benefit transferor
Applicability:-
of son’s wife 1. Individuals, HUF, AOP/BOI/AJP agriculture
5. 2. Income > 5000 p.a.
(a) Clubbing of Minor:- Income in the hands of parents whose 3. Non agriculture Income > BEL.
total Income is higher. (excluding this Income) Step -1 Tax on (AI + NAI)
(b) Clubbing Not applicable:- Income of Minor suffering from Step -2 Tax on (AI+ BEL)
disability u/s 80U, Income arrived by way of manual work, Step -3 Tax payable (step- 1 - 2)
skill, talent, knowledge. Step -4 Add Surcharge / deduct rebate u/s 87A
(c) In case of Martial relationship does not exist between Step -5 Add:- H & EC @ 4%
parents:- Clubbed with parent whose maintain the Minor
child during the P.Y. 10. DEDUCTIONS
(d) Exemption u/s 10 (32) to parent whose income including SEC-80A :-
Minor Income:- Deduction u/s 80c to 80u can’t exceed GTI. Chapter VI A
1500 per child (or) deductions available for normal income [i.e., not available for
Income so Clubbed casual income (Sec-115BB) & special income (Sec-
6. 112,112A,111A)].
(a) Gift to HUF by member of HUF: Income on such asset Deductions u/s 80C
taxable in the hands of member of HUF 1. Applicability :- Individual (or) HUF.
2.
(b) If property (i.e. gift) received by spouse after partition of
Expenditure Contribution Investments
HUF; then Income on such asset taxable in the hands of 1. Tuition fee 1. RPF 1. NSC
member of HUF who transfer asset to HUF. (Max-2)
2. L.I.P (self, 2. PPF 2. NABARD Bonds
spouse, child)
9. AGRICULTURE INCOME
3. SPF 3. Senior citizen saving
Sec- 2(1A):- Agricultural Income. scheme
(a) Any rent (or) revenue from land in India and used for 4. SAF 4. 5 year FD (Post
agricultural purpose. office & Bank)
(b) Income from land by performing agricultural operations. 5. UCIP
(c) Income from farm house in rural area & occupied by 3. Repayment of amount borrowed by assets for the
cultivator (or) receiver of Rent [i.e. Not Let out to any one] Residential house.

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 15
4. LIP (Max limit) 80DDB
20% of Sum assured Policy issued before 1.4.2012 1. Deduction to Individual (or) HUF who incur Medical
10% of Sum assuredPolicy issued b/w F.Y 12-13
10% (or) 15% (person covered u/s 80DDB/80U)  policy issued expenses of himself (or) dependent relative.
on/after 1.4.2013 2. Amount of deduction:- 40,000 (1,00,000 in case of Senior
5. Amount of deduction:- Max -1,50,000 citizen) (or) actual expenses ↓
Note: Deposit in Sukanya Samriddhi a/c allowed as deduction u/s
Note:- Relative means Spouse, children, brother, sister, (or)
80C & Interest on such a/c exempted u/s 10(11A)
Comparison of 80C, 80CCC, 80CCD, 80CCE: parents of Individual.
Sec -80C Max – 1,50,000 80E
Sec-80CCC Contribution to Max – 1,50,000 1. Deduction to Individual who paid Interest on education
pension Fund of LIC
loan taken for higher education of himself (or) relative.
Sec-80CCD (1) Own Employee – Max – 10% of salary
contribution to NPS Self-employee - Max – 20% of GTI Relative:- Spouse, children, (or) the student for whom the
Sec -80 CCD (1B) own 50,000-additional deduction Individual is legal guardian.
contribution. 2. Deduction for a period of 8 years, starting from the year in
Sec- 80CCD (2) 1. Such Contribution is perquisite
which Interest paid.
Employer contribution to to employee.
NPS 2. Deduction – Max – 14% of Deduction u/s 80G
Salary (CG Employee) S.No Category:-II Category:- III Category:- IV
3. 10% of Salary (Other than CG 1. Jawaharlal Govt (or) LA (or) Donation to
Employee) Nehru any association charitable
Salary = Basic + DA (Retirement Benefits) Memorial Fund for promotion TRUST
80cce (1) (Max)- (1,50,000) = 80C +80CCC + 80CCD (1) of family
Note:- Amount withdrawn from NPS by assessee [60% - Planning
exempted & 40% taxable] 2. P.M Drought Donation by To any
Deduction u/s 80D: Relief Fund Company authority for
A. Self, Spouse, dependent Olympic development
child association (or) of city (or)
1. MIP 25,000 any sports towns etc.
2. CGHS (Max) association
3. PHC exp (or)
3. Indira Gandhi Donation to
Memorial Minority
4. Medical exp [60 50,000 [60
years (or) more + No years (or) TRUST community
MIP] more] corporation
Max -5K

B. Max -50K Parents 4. Rajiv Gandhi Notified

1. MIP 25,000 Foundation temple,
(Max) Mosque,
2. PHC exp (or) Church
Computation of deduction u/s 80G
3. Medical exp [60 50,000 [60
years (or) more + No years (or) Category Amount of deduction
MIP] more] I 100% of amount donated
Note: II 50% of amount donated
MIP = Medical Insurance Premium
III 100% of eligible donations
CGHS =C.G Health Scheme.
PHC =Preventive heath Cheek up. IV 50% of eligible donations
80DD & 80U Eligible donations
80DD 80U 10% of Adjusted GTI (or) Total donations Under C-III & C-IV ↓
Deduction to Individual (or) HUF Deduction to Resident Individual
Adjusted GTI
who maintain dependent who is suffering from disability
GTI XXX
disable relative
Amount of deduction (fixed Normal disability 75,000
(-)All deductions u/s 80C to 80U except 80G (XXX)
amount) (-)STCG u/s 111A (XXX)
Severe disability1,25,000 (-) LTCG u/s 112 A u/s 112 (XXX)
Both 80DD & 80U Not available Adjusted GTI XXX

CA VINOD KUMAR
GURUKUL FOR CA & CMA INCOME TAX SUMMARY 16
Deduction u/s 80GG 4. Salary excludes: Non- Monetary perquisite & retirement
1. Allowed to Individual: [Self employed (or) employee Not benefits.
Received HRA (or) RFA]
80AC: Filing of ROI u/s 139 (1) within the time limit
2. Amount of deduction:-
Mandatory for Claiming deduction under-chapter VI A
(i) Rent paid (-) 10% of Adjusted GTI heading ‘C’- deduction in respect of certain Incomes
(ii) 25% of adjusted GTI [Ex:- 80QQB, 80RRB, 80JJAA]
(iii) 5000 P.M
Deduction u/s 80GGA:- 80EEA:- Interest on Housing loan
Person who Not having Business Income but making donation Conditions:
to specified Institution (or) Fund as Referred u/s 35 (or) u/s 35 1. Loan taken by individual from financial institution
CCA 2. Individual should not own any other house property
Deduction u/s 80GGB & 80GGC 3. Loan sanctioned during the PY 19-20.
80GGB 80GGC 4. SDV ≤ 45 lakhs
An Indian company All assesses except Amount of Deductions: - 1,50,000
(a) Local authority 80EEB : - Interest on Car Loan
(b) Artificial person Founded by 1. Loan taken by individual from financial institution for
Government purchase of electric card.
Donation to political party (or) electoral trust 2. Loan sanctioned by B/w 1.4.2019 to 31.3.23
Amount of deduction-100% Amount of Deductions: - 1,50,000(Max)

Deduction u/s 80TTA & 80TTB 11. RETURN OF INCOME

If assessee is Y @ Deduction u/s 80 TTB Sec – 139 (1):
ROI
resident senior Interest on F.D /R.D /Interest
1. Company & partnership form (Including LLP): Return filing
citizen on savings a/c in Bank/ Co-
compulsory
operative Bank/ Post office.
N 2. Other Assessee: -
amount of50K deduction i. If GTI (before giving exemption u/s 54/54B/54D/54EC or 54F)
If Interest on (Max) > BFL  Filing Return compulsory.
savings a/c in ii. Amt of deposit in current a/c > 2 Cr.
Bank/ co-operative iii. Expenditure on foreign country > 2 lakhs
Bank Post office
Electricity > 1,00,000Compulsory filing of ROI

Y R & OR A.  Beneficial owner of any asset (including

financial Interest) Located outside India.
Deduction u/s 80TTA  Max -10,000
Has signing authority in any Account
outside India.
S.No 80QQB 80RRB
B. Beneficiary of any asset (including financial
1. Individual Resident Individual Resident
Interest) Located outside India.
2. Royalty Income on Book Royalty Income on
patents. If Income already included in the Income of person A, then
3. Deduction Deduction Person B Not required to file Return of Income.
Income (Max- Royalty @ Income (or) 3,00,000 Due Date:
15% of MRP) (or) 1. Person required to file transfer th
3,00,000 30 Nov of RAY
pricing report u/s 92E
80 JJAA
2. (a) Company
1. Any assessee in Business and subject to tax audit u/s 44AB.
2. Amount of deduction:- 30% of additional employee cost (b) Any person subject to tax
[deduction for ‘3’ consecutive years] audit u/s 44AB th
30 Sep of RAY
3. Conditions. (c) Working partner of firm
(i) Salary not extend 25000 P.M. whose a/c’s subject to tax
(ii) Min working days – 240 days (in case of manufacture audit u/s 44AB
of apparel (or) leather product - 150 days) st
3. Others 31 July of RAY
(iii) Employee should participate in RPF.

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 17
Loss Return u/s 139 (3): Assessee is required to pay advance tax if his liability for
To be filed on (or) before due under Sec-130 (1) for C/F of advance tax is 10,000 (or) more.
following losses. Exemption from payment of advance tax:-
(a) Business Loss u/s 72 (1) Resident Senior Citizen not having Income U/H PGBP.
(b) Loss from speculation Business u/s 73 2. Due dates for payment of advance tax
(c) Loss from Specified Business u/s 73A Due Date Amount of advance tax
th
(d) Capital Loss u/s 74 Up to 15 June Up to 15% of A. Tax
th
(e) Loss from owning & Maintaining Race horses u/s 74A (3) Up to 15 Sep Up to 45% of A. Tax
Losses can be C/F even ROI Not filed within the time limit u/s th
Up to 15 Dec Up to 75% of A. Tax
139 (1): th
Up to 15 March Up to 100% of A. Tax
(i) Unabsorbed depreciation u/s 32(2) 3. Persons covered u/s 44AD/44ADA
(ii) Loss from House property u/s 71B. One Installment  100% of A. Tax [Up to 15 of March]
th

Belated Return u/s 139 (4) Non - applicability of Interest u/s 234C.
If Return not filed within the time limit u/s 139 (1), assessee Interest u/s 234C not payable if short fall is on account of
can file belated Return u/s 139 (4) at any time before. under estimate of
End of RAY Whichever is (a) Capital gain
(or) earlier (b) Casual Income u/s 115BB
Completion of assessment (c) PGBP  (first year of commencement)
Revised Return u/s 139 (5) (d) Dividend U/s 115BBDA
Return filed u/s 139 (1) (or) u/s 139 (4) can be revised u/s 139 Payment of advance tax on above Income
(5), if any omission (or) any wrong statement is discovered by If Installments are due If Installments are not due
st
the assessee at any time before, Pay advance tax in Reminding Pay advance tax by 31
End of RAY Whichever is Installments March of P.Y.
(or) earlier
13. TDS
Completion of assessment
Sec. Nature of Payment
Sec-234 F fee for default in filing ROI 192 1. TDS on salary deducted by employer at slab rates.
2. Consider all income & only loss from IFHP
Total Income Fee
192A 1. Amt withdrawn from PF @10%
Does not exceed Rs.1000 2. No TDS if amt upto 50,000
5,00,000 193 1. Interest on Securities
st
Exceed 5,00,000 ROI filed on (or) before 31 Dec of RAY  2. TDS @ 10%
5000 Rs. 194A 1. Interest other than interest on Securities.
st
ROI filed after 31 Dec of RAY but on (or) 2. Rate @ 10%
st
before 31 March  10,000 Rs. 3. No TDS if, Interest paid by Bank/Co-op-Bank/Post
Office upto 10,000.
Sec-140A:- Self- assessment tax 4. No TDS if in other cases upto 5,000 (if payee is SC -
Tax payable on Income which is declared in ROI XXX 50,000)
(-) Advance tax paid (XXX) 194B 1. Winning from lotteries, crossword puzzles etc.
(-)TDS/TCS (XXX) 2. Rate-30%
3. No TDS if winning is upto 10,000 per winning
(-) Relief u/sec.89(1) (XXX)
194BB 1. Winning from Horse race
(+)Late fee u/s 234 F XXX 2. Rate-30%
(+) Interest u/s 234 A/B/C XXX 3. No TDS if per winning amt upto 10,000
SAT u/s 140A XXX 194C 4. TDS on payment to contractor
5. If contractor is I/HUF then Rate is 1%
12. ADVANCE TAX 6. If contractor is other person is 2%
1. Computation of advance tax u/s 209 7. No TDS if
 Single payment upto 30,000
Net tax liability on estimated Income XXX  Aggregate of payment in PY upto 1,00,000
(-) TDS/TCS (XXX) 8. No TDS on payment GTA if PAN declared & No. of
(-) Relief u/sec.89(1) (XXX) vehicles does not exceeds in PY.
194D 1. Commission paid by Insurance Company to agent.
Advance tax payable XXX 2. Rate – 5%
3. No TDS if commission upto 15,000 p.a

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GURUKUL FOR CA & CMA INCOME TAX SUMMARY 18
194DA 1. TDS on maturity proceeds of Life insurance policy Sec-194N
2. Rate – 1%, if amt taxable 1. Amount withdrawn from Bank, co-operative bank, post office, by
3. No TDS upto 1,00,000 way of cash in exceeds of 1 cr. During P.Y
194E 1. TDS on payment to NR sports man/ NR Sports 2. Rate: 2% on amt in exceeds of 1 cr.
association/ NR entertainer.
2. Rate – 20% + cess 14. SET OFF AND CARRY FORWOARD OF LOSSES
194G 1. TDS on commission paid to agent on sale of lottery
IFS  No loss & No S/F
tickets
IFHP
2. Rate – 5%  It can be S/F Income from same and other heads of Income [Inter
3. No TDS if commission upto 15,000 p.a head Max – 2L only]
194H 1. Any other commission or brokerage.  C/F of loss  8 AY’s
2. Rate – 5%  𝐁/𝐅 𝐥𝐨𝐬𝐬𝐟𝐫𝐨𝐦 𝐇/𝐏- 𝐒/𝐅 𝐨𝐧𝐥𝐲 𝐢𝐧𝐜𝐨𝐦𝐞 𝐟𝐫𝐨𝐦 𝐈𝐅𝐇𝐏
3. No TDS if commission upto 15,000 p.a Loss from OMRH
194I 1. TDS on Rent 1. It can S/F only income from OMRH
2. P&M -2%, & L&B, Furniture – 10% 2. C/F  4 AY’s
3. No TDS if rent p.a upto 1,80,000 3. B/F lossfrom OMRH- B/F lossfrom OMRH
194IA 1. TDS on sale of IMP other than RAL Loss from Speculative Business
1. S/F only Income from Speculative Business(S.B)
2. Rate – 1%
2. C/F  4 AY’s
3. No TDS if consideration upto 50L
3. B/F loss from S. B- S/F only income from S. B
194J 1. TDS on professional services, technical services,
Loss from Specified business u/s 35AD
Royalty, non-compete fee, Director fee. 1. S/F only Income from Specified Business
2. Rate- 10% (Payment to call center @ 2%) 2. C/F  Unlimited years
3. No TDS, if each amt does not exceeds 30,000 (Except 3. B/F loss from Specified Business - S/F only income from S. B
Director fee)
194LA 1. TDS on compensation for compulsory acquisition. Loss from B or P
2. No TDS if compensation upto 2.5L 1. S/F from same & other heads of income except salary
3. Rate – 10% 2. C/F  8 AY’s
3. B/F loss U/H PGBP - S/F only income from U/H PGBP
194IB 1. TDS on Rent
LTCL
2. If 194I not applicable & Rent P.M exceeds 50,000 then
1. S/F only from LTCG
Sec.194IB applicable
2. C/F  8 AY’s
3. Rate – 5%
3. B/F LTCL- S/F only from LTCG
4. TDS deducted at the time of payment or credit of last
STCL
month of PY or last month of tenancy if property 1. S/F only from LTCG & STCG
vacated. 2. C/F  8 AY’s
5. MAX- TDS:- Last Month Rent 3. B/F STCL − S/F only from LTCG/STCG
194IC 1. Payment made by any person under contract u/s IFOS
45(5A)  It can be S/F Income from same and other heads of Income
2. Rate – 10%  No – C/F
Special Point (194A, 194H, 194I, 194J, 194C)
Payer I/HUF
Subject to tax audit u/s 44AB during the PFY  TDS Applicable.
Not Subject to tax audit u/s 44AB during the PFY  No TDS
Other Persons: TDS Applicable
Sec-194M
1. Payer:- I/HUF (Who are not subject to Sec.44AB in PFY)
2. Payment:- Work contract, commission or Brokerage, fee for
professional services
3. Rate: 5%
4. Threshold limit: 50L

CA VINOD KUMAR