Allowed Exppenditures !!

Tax queries 445 views 3 replies

Harshit

Arbitrager

215 Points Joined February 2011

Hi All,

I am a Arbitrager (Trader) by profession and I usually file ITR4 (Income from Business).

1) Expenses : I would like to know what are the allowed expenses approved by the governement that I can deduct from gross income and calculate my net taxable income?

2) Exemption : Currently I am aware of exemption of 1 lac under 80C & 20K for Infra Bonds. Any other Exemptions apart from this?

Any Help is Highly Appreciated.

Thanks & Regards,

Harshit Patel

Replies (3)

Athmaram

Articled Assistant

170 Points Joined March 2010

Any expenses purely relating to your business will be allowed by the income tax act.
A part from 80C there are other deductions such as

Mediclaim Premium u/s 80D to the tune of Rs.15,000 if the insured is not a Senior Citizen & Rs.20,000 if the insured is a Sr. Citizen.
Donation to any institution who has a 12A registration can be allowed as deduction u/s 80G with certain restriction.
Interest on loan repayment taken for higher education u/s 80E.
Sec 80DD Expenditure on Handicapped dependent.
Sec 80DDB Expenditure on Specified Diseasees.

There are much more deductions which depends on as the case may be. The above are some of the commen deductions available to individual assessee.

Regards

Ram.

Harshit

Arbitrager

215 Points Joined February 2011

Thanks Ram,

I am clear about the second question...

Now About, "Any expenses purely relating to your business will be allowed by the income tax act" ..
can you be more specific and is there any list I can refer to or any website in which i can understand what all is included and what is not?

Moreover, I have a clerk working for me whom i pay 3k per month by CASH, can i show it as expense, if yes, than is there any document i need to produce as a proof....