In calculating income from business and proffession, if
Provision for income tax is 4000/- and it is excess to the extent of 3000/-
the inadmissible amount should be 3000. am i right?
but the solution in the book says 4000/- (full amount)
Plz guide me.......
Hi,
Income-tax is not an allowable expenditure. Hence, income-tax debited/claimed as deduction has to be added back to arrive at the taxable income. Hence, Rs.4000/- has to be added back.
If the provision were to be Rs.1000/- (correct value), income would have been more by Rs.3000. Hence, either way, taxable income will remain same.
| Originally posted by :priyanka narale | ||
| " |
In calculating income from business and proffession, if Hi.. Provision for income tax, provision for fbt alls are inadmisible expenses what ever the amount was. |
" |
hi priyanka, as a general rule all tax provisions are disallowed for computing p&g
oh sorry guys...... its income tax i.e personal in nature n tax on property so as it is , it is not taxable......it dint strike me while solving......thanks 4 reminding me.
| Originally posted by :Dharmaraju | ||
| " | Hi, Income-tax is not an allowable expenditure. Hence, income-tax debited/claimed as deduction has to be added back to arrive at the taxable income. Hence, Rs.4000/- has to be added back. If the provision were to be Rs.1000/- (correct value), income would have been more by Rs.3000. Hence, either way, taxable income will remain same. |
" |
thank u 4 reminding me....
Income-tax is not an allowable expenditure. Hence, income-tax debited/claimed as deduction has to be added back to arrive at the taxable income. Hence, Rs.4000/- has to be added back.
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