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Tax Return form

sankalp (Tax Consultant ( Income Service Sale Tax )) (107 Points)

25 June 2011

One of my client have Income of LIC Commission accept than no other income he has than for Income tax return which return form applicable for him ?

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jaganathan (accounts executive) (272 Points)
Replied 25 June 2011

HEADS OF INCOME

In the Income Tax any income earned by a person is broadly categorised into five heads of income. Any income earned to be taxed must come under any of the five heads of income. The five heads of income are:

1. Income under Head Salaries: This head taxes the income earned by an individual as salary from any firm or organisation.

2. Income from House Property: This head taxes rental income received by any person from way of renting of any immoveable property.

3. Profits and Gains of Business or Profession: This head of income broadly covers income earned by a person as a result of some business or professional set-up by him.

4. Capital Gains: This head of income taxes the income earned on sale of any investment in form of gold, precious ornaments, shares, etc or immoveable property.

5. Income from other Sources: This head of income covers any income which is not chargeable to tax under any of the above heads of income. Any income including gambling or profit/loss on running of race horses, camels, interest income , etc are chargeable to tax under this head of income.

We will take each Head of Income one by one but first in the next post we will understand meaning of the term “Income” itself:

LIC COMMISSION COMES UNDER Profits and Gains of Business or Profession HENCE ITR 4 IS APPLICABLE

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