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    Assignment On Taxation

    Uploaded by

    JasmeetKaur
    The document calculates the taxable income and tax liability of Mr. B based on his various sources of income and expenses/deductions. Mr. B's total income was Rs. 1,26,00,000 and total deductions were Rs. 2,07,000, resulting in a taxable income of Rs. 1,23,93,000. His total tax liability was calculated to be Rs. 35,30,400.

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    Assignment On Taxation

    Uploaded by

    JasmeetKaur
    871 views3 pages
    The document calculates the taxable income and tax liability of Mr. B based on his various sources of income and expenses/deductions. Mr. B's total income was Rs. 1,26,00,000 and total deductions were Rs. 2,07,000, resulting in a taxable income of Rs. 1,23,93,000. His total tax liability was calculated to be Rs. 35,30,400.

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    ASSIGNMENT ON TAXATION

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    The document calculates the taxable income and tax liability of Mr. B based on his various sources of income and expenses/deductions. Mr. B's total income was Rs. 1,26,00,000 and total deductions were Rs. 2,07,000, resulting in a taxable income of Rs. 1,23,93,000. His total tax liability was calculated to be Rs. 35,30,400.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    871 views3 pages

    Assignment On Taxation

    Uploaded by

    JasmeetKaur
    The document calculates the taxable income and tax liability of Mr. B based on his various sources of income and expenses/deductions. Mr. B's total income was Rs. 1,26,00,000 and total deductions were Rs. 2,07,000, resulting in a taxable income of Rs. 1,23,93,000. His total tax liability was calculated to be Rs. 35,30,400.

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    ASSIGNMENT ON TAXATION

    Q)Mr B aged 63 years, has earned rupees 75,00,000 out of his


    business. His ex- wife gifted him cash in account worth rupees 6
    lakh. He spent a total of rupees 15 lakh during a family trip. He
    won a lottery of 19 lakh rupees. Out of happiness he gifted his
    wife cash of rupees 450000. He bought a life insurance policy
    and paid a premium of 50000 annually. He paid tuition fee for
    his daughter for rupees 50000. He invested rupees 80000 in
    PPF. One of his existing life insurance policy got matured and he
    received a total of rupees 32 lakh. Seeing his health conditions
    the doctor advised him a medical test of rupees 6000 following
    he bought a health insurance for rupees 27000. Calculate his
    taxable income and tax liability.
    Answer:
    1. Mr B's total income from various sources: - Business
    income: 75,00,000 - Gift from ex-wife: 6,00,000 (gifts from
    relatives are not taxable) - Lottery winnings: 19,00,000
    (taxable at a flat rate of 30%) - Maturity amount from life
    insurance policy: 32,00,000 (taxable if the premium paid is
    more than 10% of the sum assured)

    2. Mr B's total expenses and deductions: - Family trip:


    15,00,000 (not deductible) - Gift to wife: 4,50,000 (not
    deductible) - Life insurance premium: 50,000 (deductible
    under section 80C) - Tuition fee for daughter: 50,000
    (deductible under section 80C) - PPF investment: 80,000
    (deductible under section 80C) - Medical test: 6,000 (not
    deductible) - Health insurance premium: 27,000
    (deductible under section 80D)

    3. Calculate the taxable income: - Total income: 75,00,000 +


    19,00,000 + 32,00,000 = 1,26,00,000 - Total deductions:
    50,000 + 50,000 + 80,000 + 27,000 = 2,07,000 - Taxable
    income = total income – total deduction
    i.e 1,26,00,000 - 2,07,000 = 1,23,93,000

    4. Calculate the tax liability: - Tax on lottery winnings:


    19,00,000 * 30% = 5,70,000 - Tax on remaining income
    (1,23,93,000 - 19,00,000) = 1,04,93,000
    Up to 2,50,000: No tax
    - 2,50,001 to 5,00,000: 5% of (5,00,000 - 2,50,000) =
    12,500
    - 5,00,001 to 10,00,000: 20% of (10,00,000 - 5,00,000) =
    1,00,000
    - Above 10,00,000: 30% of (1,04,93,000 - 10,00,000) =
    28,47,900
    - Total tax on remaining income: 12,500 + 1,00,000 +
    28,47,900 = 29,60,400

    5. Total tax liability: Tax on lottery winnings + Tax on


    remaining income = 5,70,000 + 29,60,400 = 35,30,400
    So, Mr B's taxable income is 1,23,93,000 and his tax
    liability is 35,30,400.

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