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GROSS TOTAL INCOME

Rahul Bansal (Finalist) (35929 Points)

24 October 2009

R, has computed his gross total income for the A.Y. 2009-10. which amounted to Rs. 290000.

It includes:

*Rs. 150000 on account of LTCG &,

*Rs. 10000 on account of winning horse races.

He has deposited Rs. 70000 in a PPF during the P.Y.

Compute the tax payable by R, assuming that he is less than 65 years of age.

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13 Replies

Rahul Bansal (Finalist) (35929 Points)
Replied 24 October 2009

R, has computed his gross total income for the A.Y. 2009-10. which amounted to Rs. 290000.

It includes:

*Rs. 150000 on account of LTCG &,

*Rs. 10000 on account of winning horse races.

He has deposited Rs. 70000 in a PPF during the P.Y.

Compute the tax payable by R, assuming that more than 65 years of age & resident in India.

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Rahul Bansal (Finalist) (35929 Points)
Replied 24 October 2009

R, has computed his gross total income for the A.Y. 2009-10. which amounted to Rs. 290000.

It includes:

*Rs. 150000 on account of LTCG &,

*Rs. 10000 on account of winning horse races.

He has deposited Rs. 70000 in a PPF during the P.Y.

Compute the tax payable by R, assuming that more than 65 years of age & non-resident in India.

Sandeep Pandey (CA FINAL) (1306 Points)
Replied 24 October 2009

Prateek (Chartered Accountant) (32 Points)
Replied 24 October 2009

My ans for the first que i.e. <65yrs n resident wud be Rs.15000+ed cess.

n for the 2nd case wud be Rs.3000+ed cess.

praveen (Chartered Accountant) (6971 Points)
Replied 24 October 2009

LTCG on what???

shares, property, etc.

Be specific please.

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Deeps (Article Assisstant) (2485 Points)
Replied 24 October 2009

1. Pl. specify the nature of the LTCG..

2. Rs. 10000 on account of winning horse races.

Section 115BB prescribes the rate of tax @ 30% for winnings from-

(i) any lottery; or

(ii) crossword puzzle; or

(iii) race including horse race; or

(iv) card game and other game of any sort; or

(v) gambling or betting of any form.

APPLICABLE RATE OF TAX IN RESPECT OF CASUAL INCOME [SECTION 115BB]

(i) This section provides that in respect of income by way of winnings from lotteries, crossword puzzles, races including horse races or card games and other games of any sort or

from gambling or betting of any form, a flat rate of 30% plus surcharge plus education cess is

applicable.

(ii) No expenditure or allowance can be allowed from such income.

(iii) Deduction under Chapter VI-A is not allowable from such income.

(iv) Adjustment of unexhausted basic exemption limit is also not permitted against such

income.

Therefore, it is taxed at a flat rate of 30% irrespective of age.

LTCG:

As you have these many possibilities pl. specify the nature of LTCG

TAX ON LONG-TERM CAPITAL GAINS [SECTION 112]

(i) Where the total income of an assessee includes long-term capital gains, tax is payable

by the assessee @ 20% on such long-term capital gains. The treatment of long-term capital

gains in the hands of different types of assessees are as follows -

(1) Resident individual or Hindu undivided family:

Income-tax payable at normal rates on total income as reduced by long-term capital

gains plus 20% on such long-term capital gains.

However, where the total income as reduced by such long-term capital gains is below the maximum amount which is not chargeable to income-tax then such long-term capital

gains shall be reduced by the amount by which the total income as so reduced falls short

of the maximum amount which is not chargeable to income-tax and the tax on the

balance of such long-term capital gains will be calculated @ 20%.

(2) Domestic Company:

Long-term capital gains will be charged @ 20%.

(3) Non-corporate non-resident / foreign company:

Long-term capital gains will be charged @ 20%.

(4) Residents (other than those included in (i) above)

Long-term capital gains will be charged @ 20%.

(ii) The proviso to section 112 states that where the tax payable in respect of any income

arising from the transfer of listed securities or units or zero coupon bonds, being long-term

capital assets, exceeds 10% of the amount of capital gains before indexation, then such

excess shall be ignored while computing the tax payable by the assessee.

(iii) For this purpose, "listed securities" means securities as defined by section 2(h) of the

Securities Contracts (Regulation) Act, 1956; and "unit" means unit of a mutual fund specified

under section 10(23D) or of the Unit Trust of India.

(iv) The provisions of section 112 make it clear that the deductions under chapter VIA cannot

be availed in respect of the long-term capital gains included in the total income of the

assessee.

EXEMPTION OF LONG TERM CAPITAL GAINS ON SALE OF EQUITY SHARES/

UNITS OF AN EQUITY ORIENTED FUND [SECTION 10(38)]

(i) Section 10(38) exempts long term capital gains on sale of equity shares of a company or

units of an equity oriented fund on or after 1.10.2004, being the date on which Chapter VII of

the Finance (No.2) Act, 2004 comes into force.

(ii) This exemption is available only if such transaction is chargeable to securities

transaction tax.

(iii) However, such long term capital gains exempt under section 10(38) shall be taken into a

account in computing the book profit and income tax payable under section 115JB.

(iv) For the purpose of this clause, “Equity oriented fund” means a fund –

(1) where the investible funds are invested by way of equity shares in domestic companies

to the extent of more than 65% of the total proceeds of such fund; and

(2) which has been set up under a scheme of Mutual Fund specified under clause (23D).

(v) The percentage of equity share holding of the fund should be computed with reference to the annual average of the monthly averages of the opening and closing figures.

1 Like

Nitin Grover (CS) (1228 Points)
Replied 24 October 2009

in case he is of above of 65 years then

30% on horse race

and now gross income is (290000-10000) = 280000

and LTCG is 150000

so Gross Total Income under any other head is 130000

so let say upto 185000 no tax is here so

130000 is exempt and remaining balance Rs. 55000 will be non taxable from LTCG

so from LTCG (150000-55000) = 95000 will be chargeable as 20%

so tax will be

10,000*30% = 3000

95000*20% = 19000 plus cess

Thanks

Nitin Grover

1 Like

santhosh (Student) (1174 Points)
Replied 25 October 2009

very nice deepika... it is extremely rit.....

Juzer Sadikot (CA - innovative solutions for Imports and Exports) (1309 Points)
Replied 25 October 2009

Dear friends,

Particular	Case 1		Case 2		Case 3
Basic Exemption Limit	150000		225000		150000
Deduction u/s. 80C	70000		70000		70000
Gross total Income	290000		290000		290000
Casual Income		10000		10000		10000
LTCG		150000		150000		150000
Other Income		130000		130000		130000

Deduction of 80 C with
Casual Income	Nil		Nil		Nil
LTCG	Nil		Nil		Nil
Other Income	70000		70000		70000

Balance Total Income	220000		220000		220000
Casual Income		10000		10000		10000
LTCG		150000		150000		150000
Other Income		60000		60000		60000

Adjustment with Basic Exemption Limit
Casual Income	Nil		Nil		Nil
LTCG	90000		150000		Nil
Other Income	60000		60000		60000

Calculation of Tax	Income	Tax	Income	Tax	Income	Tax
Casual Income	10000	3000	10000	3000	10000	3000
LTCG (taxable at the rate prescribed under section 112 other than proviso under sub section 1 of section 112)	60000	12000	Nil	N.A.	150000	30000
Other Income	Nil	N.A.	Nil	N.A.	Nil	N.A.
Total Tax	Without Cess	With Cess	Without Cess	With Cess	Without Cess	With Cess
Total Tax	15000	15450	3000	3090	33000	33990

Juzer

1 Like

Rahul Bansal (Finalist) (35929 Points)
Replied 25 October 2009

thanks every1

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CA.Amit Mehta (Professional) (254 Points)
Replied 26 October 2009

15000

Rahul Bansal (Finalist) (35929 Points)
Replied 08 November 2009

Originally posted by :Juzer
"	Dear friends, Particular Case 1 Case 2 Case 3 Basic Exemption Limit 150000 225000 150000 Deduction u/s. 80C 70000 70000 70000 Gross total Income 290000 290000 290000 Casual Income 10000 10000 10000 LTCG 150000 150000 150000 Other Income 130000 130000 130000 Deduction of 80 C with Casual Income Nil Nil Nil LTCG Nil Nil Nil Other Income 70000 70000 70000 Balance Total Income 220000 220000 220000 Casual Income 10000 10000 10000 LTCG 150000 150000 150000 Other Income 60000 60000 60000 Adjustment with Basic Exemption Limit Casual Income Nil Nil Nil LTCG 90000 150000 Nil Other Income 60000 60000 60000 Calculation of Tax Income Tax Income Tax Income Tax Casual Income 10000 3000 10000 3000 10000 3000 LTCG (taxable at the rate prescribed under section 112 other than proviso under sub section 1 of section 112) 60000 12000 Nil N.A. 150000 30000 Other Income Nil N.A. Nil N.A. Nil N.A. Total Tax Without Cess With Cess Without Cess With Cess Without Cess With Cess 15000 15450 3000 3090 33000 33990 Juzer	"