Agriculture Income

 the agricultural income have add your total income. then compute tax on the both amount.

then you calculate tax for agricultural income, it willl be deductable from total tax amount.

eg:

business income                                     200000

Agricultural income is                               50000

Taxable income                                      250000

Tax  10% of (250000-160000)               9000

less: Tax on Agri income 

10% of 50000                                        5000

        Tax payable                                     4000

Agricultural Income alone is exepmt from tax it is taxable only if 2 conditions are satisfied.

1. If the Tax payer is having any Non- Agricultural income and if it exceeds the minimum taxable limit for that Asst.Year and,

2. If the Agricultural Income exceeds Rs.5000\-

the the calculation is as fallows:-

a)Gross Income = ( Taxable income + Agricultual ) and calculate tax  on Gross income according to the applicable rates for that asst.year ; then

b)Agricultural Income Exemption: - Add agricultual income to the Minimum Taxable limit and calculate tax ther on according to the rates prescribed.

then a-b is the net tax payable

you can analyse the formula with the example given by Mr. Murugan

In a question ,

A man had received a share a crop from leased agricultural land. A part of crops received - he consumed.

And the rest he sold for Rs.30000.He then deposited this 30000 in PPF.

What will be the treatment here???Is 30000 agricultural income?

agreed with members

Originally posted by : Amar Sharma
	In a question , A man had received a share a crop from leased agricultural land. A part of crops received - he consumed. And the rest he sold for Rs.30000.He then deposited this 30000 in PPF. What will be the treatment here???Is 30000 agricultural income?

hello Amar

yes Rs 30000 will be agricultural income in the hands of assessee and will be exempt from tax and no treatment will be done

Any rent received from land which is used for agricultural purpose: Assessees do not have to pay tax on rent or revenue from agricultural land. Such land should, of course, be assessed to land revenue in the country or be subject to a local rate. Further, there must be a direct link between the agricultural land and the receipt of income by way of rent or other revenue (for instance, a landlord could receive revenue from a tenant).

also

Any income derived from such land by agricultural operations including processing of agricultural produce, raised or received as rent in kind so as to render it fit for the market, or sale of such produce.

hope it will solve your query :)

take care