F.A.Q on Indian Income Tax Laws

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Whether Life Time Pension Arrear Taxable In The hands of Legal heir?
2007-10-29 05:06:00
Whether Life Time Pension Arrears (LTPA) payable to a deceased employee is taxable in the hands of nominee. In a other way ,whether such amount should be included to the total income of the nominee and taxed. Please explain in detail to enable to guide one of friends in his tax planning.nominee's own annual income is around Rs.3.2 lakhs and if he/she receives around Rs. 0.87 lakh as LTPA as a nominee of his/her deceased father, then whether this 0.87 lakh should be shown as 'income from other sources' and added to Rs.3.2 lakh to work out total income and taxed. If not then how this Rs.0.87 lakh to be shown in the income tax return of the nominee. SalmaPension is defined as salary under section 17 of the I T Act. The life time pension arrears actually accrues to the pensioner who died but could not receive. Under the pension rule, a pensioner has to nominate a person who will receive arrears of pension till the day of death. In case , nomination is not there ,legal heir can cl...
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Is there Any Relief to Author Under Indian Income Tax Laws?
2007-10-25 05:41:00
I am an Associate Professor in an University. I have co-authored two text books for Board of secondary education. The books are in Hindi. Do I have to pay tax on the income? I am getting confused even after going through section 80 QQB of I T Act. Please Help.Dr. Praveen Mathur Section 80QQB of the I T Act provides deduction up to Rs 3,00,000 to authors. The silent point of provisions are summarized below: The deduction is available to an Author who is resident of India.Author includes Joint Author. The book should be work of literary ,artistic or scientific in nature. But the book should notbe"brochures,commentaries, guides,diaries,magazines,journals,newspap er,pamphlets,text books for schools,tracts or other publication of similar nature , by whatever name called" The income should be earned in exercise of his profession. The income should be either royalty or copyright fee or advance lump sum payment of royalties or copy right which is non returnable or lump sum consideration fo...
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Are the Gratuity & Leave Salary received by legal heir Exempt?
2007-10-21 21:07:00
Whether gratuity and leave salary becoming due on the death of an employee are taxable in the hands of nominee/legal heir? Please explain in detail.M K L Chand First of all , it should be known that definition of Salary specifically mentions "Gratuity " .Therefore, gratuity is taxable whether being received by employee or his/her legal heir .However ,the leave salary received by the legal heir of an employee is totally exempt. . The detailed answer is as under: Gratuity The gratuity received by an employee is taxable as salary. But if it is received by a legal heir of an employee on his death, it is taxable under "income from other sources' . I T Act provides exemption of certain amount from death-cum -retirement gratuity u/s 10(10) . The basic rule of exemption in case death -cum retirement gratuity is as as under Government & local Authority Employee Employee Under gratuity Act Any other Employee Gratuity is fully exempt. Least of the following:1. Actual Gratuity...
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Are 100 % Tax Exempt Companies Liable to Pay FBT?
2007-10-19 20:24:00
We are having a Software Outsourcing IT enabled Company. This is approved by the Software Technical Park of India (STPI), Govt. of India and it is a STPI Unit. We are completely exempted from income tax since all our income is on foreign currency and no income in Indian currency as per rule.Now will you please let me know whether the Fringe Benefit Tax will apply to our Company since we are completely exempted from tax. P. Natarajan In my opinion , fringe benefit tax provision is applicable on you .This is on account of section 115WA(2) of the I T Act which makes it clear that employers though not liable to pay any tax on his total income , are still liable to pay tax on the fringe benefits .The said section 115WA is given as under: Charge of fringe benefit tax. 115WA. (1) In addition to the income-tax charged under this Act, there shall be charged for every assessment year commencing on or after the 1st day of April, 2006, additional income-tax (in this Act referred to as...
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Are You taxable for Research Remuneration Received In UK?
2007-10-15 18:34:00
I am working in Cambridge university as a researcher. I will be here from August 5, 2007, up to 2 years. I am in the service of Government of India and presently I am on leave. I get a salary of... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Can You Claim STT As Cost of Share Purchase?
2007-10-14 21:51:00
We are a company doing investments in shares i.e. we buy shares, take delivery and sell after few/many months. Our Assessing Officer says that we should add the Securities Transaction Tax paid on... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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How Can You Prevent TDS on Rental Receipts?
2007-10-13 19:44:00
I have rented out a property in Gurgaon and the lessee is asking me for a letter from the Income Tax Dept. stating that he does not need to deduct the tax at source. Is this correct? If so how and... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Are You Liable to Tax Even If Your Total Income Is Below Exemption Limit?
2007-10-09 17:07:00
For the Assessment year 2005-06, I was a full-time PG student with zero income. I had won a prize of Rs 30K in a quiz competition on which a TDS of Rs 9180 was collected. After filing for TDS refund,... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Is it compulsory to disclose exempted income in the income tax return?
2007-10-07 15:13:00
Is it compulsory to disclose exempted income in the Indian income tax return? Can NRI ignore the direction given in the tax return to declare exempted incomes such as his foreign income? As there is... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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When Should You Get Tax Audit Done In Case Of Day Trading of Shares?
2007-10-07 08:34:00
I do only day trading. When am I required to get my accounts tax audited ? Renesh Jain The day trading is definitely speculative in nature. The delivery is never taken or given.Therefore, confusion... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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How Is Sale Of Foreign Listed ESOP Shares taxed ?
2007-10-02 14:20:00
I want to understand the tax implication on ESOPs. One of my friend's has got ESOPs of MNC listed in the US. He has sold the same & has made capital gains (long term) because of the same. What... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Is There Any Tax Relief for Expense on Renal Failure Patient?
2007-10-01 13:19:00
My mother was hospitalised in July this year and she was diagnosed as a Chronic Renal Failure (both kidneys are destroyed). She is put on for dialysis twice a weak and this is supposed to be a life... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Send Money Abroad Up To USD 2,00,000 Now!
2007-09-29 16:55:00
News You Can Use The Reserve Bank Of India has further liberalised the forex rules and one of the relaxation affecting Individuals immediately will be raising of remittance limit under Liberalised... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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What Happens If Possession of Flats Gets Delayed Beyond 3 Years?
2007-09-27 04:41:00
What is the income tax rule if my apartment possession gets delayed by more than 3 years (from the date I take the loan)? Nitin Section 24 of the I T Act is for deduction of interest from house... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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How to Compute Tax In Case You Have Agricultural Income?
2007-09-26 20:34:00
While clubbing the agricultural income with non-agricultural income for tax purpose , whether non- agricultural income to be taken at gross income or net taxable income after deduction u/s. 80C... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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When Can Your Return Be Declared Defective?
2007-09-21 05:06:00
I have filed the return for the AY 2006-07 computing tax as per the provisions of 44AD as the gross receipts was less than 40 Lakhs. I have declared 8% income on the gross receipts as required by the... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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What Is the Meaning of Dependant for Claim of deduction u/s 80DD?
2007-09-17 19:01:00
I have a handicapped dependent who is my cousin ( son of my mother’s sister). He is completely dependent on me and every month I spend Rs 5000. He is suffering from 95 % Blindness and mental problem.... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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What Are The Tax Benefits Available To Senior Citizens?
2007-09-12 03:57:00
What are the deductions admissible to a Senior Citizen ? K G MenonThere are not many Exclusive deductions available to senior citizen . A person becomes senior citizen under Income Tax Act in any year... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Why Should You Not Forget To Deduct Tax At Source?
2007-09-09 18:00:00
Now , even individuals or HUF have been made responsible for deducting tax at source if their sales turnover exceeds Rs 40 lakhs or gross receipts from profession exceeds Rs 10 lacs. Not deducting... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Is Insurance Premium Exceeding 20 % Injurious To Wealth ?
2007-09-06 20:08:00
Life Insurance and Unit Linked Insurance Plans are very popular as a tool to get deduction u/s 80C of the I T Act.There is two common perception regarding these two types of investments The... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Is FBT Applicable on Charitable Trusts?
2007-09-05 04:48:00
Whether FBT is applicable to Char itable Trusts ? Kishan Lal Agarwal Section 115W(a)(iii) of the I T Act specifically exempts funds ,trusts or institution eligible for exemption u/s 10(23C) or... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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eTDS Is Mandatory For Most Persons Now!
2007-09-05 04:39:00
Till now, only eTDS was mandatory for Government or Company deductor . However, now the CBDT has amended the Rule 31A, & 31AA vide Notification No. 238/2007 [ S.O. 1484(E) ] dated 30th August, 2007... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Which Bank Accounts Can be Operated By An NRI ?
2007-09-04 08:19:00
Indian banking system allows three types of accounts for person residents outside India specially created for non resident Indians. NRIs . The bank accounts that can be operated are : Foreign... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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How To Get Relief From Double Taxation ?
2007-09-02 04:19:00
In case , one earns income which suffers tax outside India, the Income Tax Act has clear provision of relief from such double taxation. The relevant provision are contained in section 90 and... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Can You Claim Deduction On home loans for Two or More Houses?
2007-08-31 16:02:00
1. I have borrowed Housing Loan of Rs. 700000/- for my house where I am staying, EMI is Rs. 12000/-. Principal Amount is app. Rs. 5000/- pm, Interest portion is app. Rs. 7000/- pm 2. Now I want to... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Can The User of Service Be Liable to Pay Service Tax?
2007-08-31 03:26:00
can user of service be liable to pay service tax any way, if service provider has not charge service tax in their bill.Also tell me relevant section in the act. RAMAKANT KHANDELWAL The concept of... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Can You Claim HRA Exemption As Well As Interest & 80C Deduction?
2007-08-29 15:42:00
Whether HRA exemption and housing loan rebate can be claimed together. Prashant P.Damani Yes, both can be claimed , but in some special circumstances. For claiming HRA exemption under the I T Act,... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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What Is The Difference Between 194C & 194I ?
2007-08-29 15:32:00
What is the TDS rate applicable for Car hire? We have an arrangement with a car rental company for the car hire, they are exempt from TDS, but last financial year they mistakenly omitted our name... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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Is Consultant For Software Testing Service Provider Taxable Under Service T
2007-08-28 17:08:00
I am working as a Domain consultant for Software testing service provider. I raise a monthly Invoice for fees & I state " Fees towards services rendered as Domain Consultant for Software testing... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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What Is The Difference Between A Member & A Coparcener of An HUF?
2007-08-21 18:40:00
I was a member of HUF of which my father was Karta. My mother & myself were co-parceners. Recently, we have made partition & new HUF is formed of which I am Karta. My wife, Priyanvada, & my son,... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
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