1. Total income
Presented by,
Mrinalini singh
Anurag samaddar

2. Contents First head: House property.
Second head: Business and Profession.
Third head: Capital gain.
Forth head: Other sources.
Set off and carry forward of loses.
Total income
First head: House property.
Second head: Business and Profession.
Third head: Capital gain.
Forth head: Other sources.
Set off and carry forward of loses.
Total income

3. Total income comprise with 4 heads
property
House
And profession
Business
gains
Capital
sources
Other

4. First
head
House
property

5. Three ways to use house property:
Self occupied.
Business.
Rented.

6. There are two condition falls under this calculation:
Computation of
gross annual value
There are two condition falls under this calculation:
If the standard rent is not given.
If the standard rent is given.
Fair rent
Municipal value
Standard rent
Expected rent
Actual rent

7. Computation of house property
particulars
amount
Gross annual value
Less : municipal tax
unrealized rent
Annual value
less : standard deduction on annual value
interest on loan
Taxable income

8. Question
An assessee owns three house property . The following are the particulars:
particulars
1st house
2nd house
3rd house
Standard rent
13000
3600 -
Municipal value
12000
4000
10000
Rent received
4800
Municipal tax paid
2000
500
How used
Let out for business
Let out for residency
Self occupied
Repairs
600
200
Interest on mortgage(loan not taken for house property)
Ground rent 50 30
Fire insurance premium 70

9. Solution particulars Amount First house: Gross annual value 12000
Less : municipal tax
2000
Annual value
10000
Less : standard deduction 30% of annual value
3000
Income from first house
7000
Second house
4800
500
4300
1290
Interest of loan
Nil
Income from second house
3010

10. Particulars
Amount
Third house
Annual value
Nil
TOTAL INCOME FROM HOUSE PROPERTY
10010

11. Second
head
Business
and
profession

12. Computation of business
particulars
Amount
Net profit as per p/l account
Add : disallowed items
Less : items not taxable under this head
Income from business

13. Disallowed items House hold expenses All type of provisions
Interest on capital
Wealth tax
Life insurance premium
Private expenses

14. Not taxable under this head
Dividend
Interest from govt securities
Rent from house property
Gifts from family member

15. Allowed depreciation rate
Patent 25%
Surgical equipment and motor car 15%
Building 10%
books
Annual publication 100%
Other than annual publication 60%

16. Computation of profession
particular
amount
Gross professional earnings
less : professional expenses
Taxable income

17. Question
Mr. Z running a cloth business, has prepared the following profit and loss account for the year ended 31st march,2011. you are required to compute his income from business and his gross total income for the assessment year Profit and loss account
Particulars
Amount
Trade expenses
450
Gross profit
219400
Establishment charge
2200
Dividend net
3140
Rent, rates and taxes
1400
Int on non govt securities
3600
Household expenses
1850
Discount allowed
200
Income tax
700
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18. Particulars
Amount
Postage and telegram
100
Gifts to relatives
125
Fire insurance premium
250
Donation to prime minister national relief fund
800
Repairs,etc
1600
Life insurance premium
850
Wealth tax
600
Interest on capital
400
Audit fees
Net profit
213915
226140

19. Solution particular Amount Net profit as per p/l a/c 213915
Add : disallowed items
Household expenses
1850
Income tax
700
Gifts to relatives
125
Donation
800
Life insurance premium
850
Wealth tax
600
Interest on capital
400
Less : income not taxable under this head
Dividend
3140
Interest on non government securities
3600
Income from business
212500

20. THIRD
HEAD
CAPITAL
GAIN

21. Exemptions 54 Transfer of property used for residency. 54B
Transfer of agriculture land.
54D
Compulsory acquisition of land and building.
54EC
Transfer of a long term capital assets invested in long term specified assets.
54F
Capital gain on investment from other assets invested in residential house.
54G
Shifting of industrial undertaking from urban to rural area.

22. Types of capital assets
Long term
asset held more than 36 months .In the case of shares more than 12 months.
Short term
Asset held not more than 36 months .in the case of shares not more than 12 months.

23. Computation of Capital gain
Particulars
amount
Sales consideration
Less : selling expenses
Net sales consideration
Less: cost/index cost of assets
Capital gain
Less: exemptions under sections
Taxable capital gain

24. Question
Mr. sanjeev is a resident of India . He furnishes the following information about his income during previous year :
Capital gain of rs from a house which he acquired before two years of the date of sale 31st July 2010.
On 31st aug 2010 , he sold equity shares to thapad ltd. For rs were purchased by him on 1st April 1985 for rs
He sold an machinery for rs during the previous year . The land was owned by him for the last five years , which was purchased for rs
On 1st march 2011 he sold a flat for rs which was purchased by him on 1st Jan 1976 for rs The fair market value of this flat was rs on 1st April 1981.
Compute the taxable income for the year Cost inflation index was :100; :133; :632.

25. Solution Particulars Amount Total Case 1st Capital gain(short term)
10500
Case 2nd
Sales consideration
85000
Less: index cost
112263
Long term capital loss
(27263)
Case 3rd
25500
8220
Long term capital gain
17280
Case 4th
770000
639900
130100
TOTAL INCOME FROM CAPITAL GAIN
130617

26. Forth head
Other
sources

27. Including items Any kind of interest received.
Dividend from foreign company and co operative society.
Management consultation fees.
Rent of factory , machinery , ground , open land , field , etc .
Winning from lottery , cross word puzzle , card games , betting .
Horse race and income from maintaining race horses.
Director fees.
Salary of an member of parliament and M . L . A.
Royalty.
Income from sub let house.
Foreign agriculture income.

28. Conditions of grossed up
When net , tax free , and received . if any one of these 3 words mention in the statement then it should be grossed up. But in the case of government securities the word tax free should be written in the statement for grossing up the government securities.

29. Rates of Deduction of tax
If the co’ is domestic
30%
Horse race
Lottery , cross word
Card games

30. ON INTEREST OTHER THAN INTEREST ON SECURITY
IF THE CO’ IS DOMESTIC
10%
ON ANY OTHER INCOME
ON INTEREST OTHER THAN INTEREST ON SECURITY

31. Company is not domestic
30%
LOTTERY,CROSS WORD AND CARD GAMES.
HORSE RACE
20%
LONG TERM CAPITAL GAIN.
MONEY BORROWED IN FOREIGN.
15 AND 40%
SHORT TERM CAPITAL GAIN.
ON ANY OTHER INCOME.
RESPECTIVELY

32. Question
Shri kalyan singh is a political leader . The particulars of his income for the year are as follows:
Winning from lottery net received rs 7000.
Dividend on equity shares rs and incurred rs 1500 as collection charges.
Rs 3600 as interest on tax free debentures of gunjan electrical ltd.
Rs 1800 , tax free debentures of textile company.
He received income from foreign agriculture of rs
Compute his taxable income under the head other source.

33. Solution particulars Amount Winning from lottery 10000
Dividend on equity shares
Nil
Tax free debentures of gunjan elects ltd
4000
tax free debentures textile ltd
2000
Income from foreign agriculture
24000
Less: collection charges
Income from capital gain
40000

34. Set off and carry forward
Heads
Set off
Carry forward
1.Loss on house property
By any head( c. y)
8 years
By any head (n.y)
2.Loss on business
2.1 non speculation business
By any head except salary(c.y )
By own head (n.y)
2.2 speculation business
By own head(c.y )
4 years
By own head(n.y)
3.Capital gain
3.1 short term capital loss
By long and short term(c.y)
By short term
3.2 long term capital loss
By own head

35. Particulars
Set off
Carry forward
4.Other sources
4 years
Loss on maintain the race horse
Profit on maintaining race horses in (c.y) and(n.y)

36. Total
income

37. Exemptions 80IA- Deduction in respect of infrastructural facilities.
80G- Deductions in respect of donations TO APPROVED FUNDS OR INTITUTIONS.
80GGA- Payment to scientific research or to a university and college etc. for scientific, social and statistical research.
80GGB- Deduction in respect of contribution given by companies to political parties.
80IA- Deduction in respect of infrastructural facilities.
80IAB- Regarding development of special economic zone.
80IB- Deduction in respect of profits OF NEW INDUSTRIAL UNDERTAKINGS OR HOTEL BUSINESS.

38. 80JJAA- Deduction in respect of employment of new workmen.
80IC- Special provision in respect of certain undertakings or enterprises in certain special category states.
80ID- Provides for a five year tax holiday to new hotel of two, three ,four, star category and conventions centers.
80IE- An undertakings engaged in the business of hotel(not below two star category)located in north eastern states.(states are A.P , ASSAM , MANIPUR , MEGHALAYA , MIZORAM , NAGALAND , SIKKIM , AND TRIPURA.
80JJA- Deduction in respect of profit and gain from business of collecting and processing of bio-degradable waste.
80JJAA- Deduction in respect of employment of new workmen.
80LA- Deduction in respect of certain incomes of offshore banking units and international financial service centers.

39. Question
From the following particulars of income of Mr. Ashok Kumar for the year ended on 31st march 2011, calculate his total income for the assessment year :
Rent receive from house property let out to state bank of India Rs
Business profit Rs
setting off Rs paid as donation to the chief minister relief fund
Long term capital gain Rs and having a short term capital loss of Rs
he received interest of Rs
He paid Rs in respect of scientific research.
He contribute Rs in respect of political parties.

40. Provide money for development for special economic zone Rs. 15500.
Income from 3 star hotel situated in Manipur Rs
Having a business which relates to bio degradable processing and receive a profit of Rs
His winning from lottery Rs he had purchased a lottery ticket of Rs. 500.