Tax Book 2023

Computation of Taxable Income Chapter- 06

97,97A,98

Disposal of assets between wholly

owned companies, disposal of asset

under a arrangement and

reconstruction and change in control

of an entity

MCQ’s with solutions

98A &

98B

Change in the constitution of AOP

and Discontinuance of business or

dissolution of AOP

ICMAP and CA Mod C past papers

theoretical questions

PART – I (For CAF- 6 and ICMAP students)

1. Tax on taxable income [U/s 4]

Income tax shall be imposed each tax year (subject to this Ordinance), at the rate or rates specified

the First Schedule, as the case may be, on every person who has taxable income for the year. From

the resultant income tax computed subtraction shall be made for any tax credits allowed to the

taxpayer for the year.

Where a taxpayer is allowed more than one tax credit for a tax year, the credits shall be applied in the

following order-

(a) any foreign tax credit allowed u/s 103; then

(b) any tax credit allowed u/s 61 to 65; and then

(c) any tax credit allowed for taxes paid (including advance tax) and tax deducted at source,

Certain classes of income and income of certain classes of persons may be subject to separate

taxation or collection of tax or deduction of tax shall be treated as a final tax on the income of the

person.

Income covered under FTR and SBI shall not be included in the computation of taxable income in

accordance with section 8 or 169, as the case may be.

1.1 Super tax for rehabilitation of temporarily displaced persons [Section 4B]

A super tax shall be imposed for rehabilitation of temporarily displaced persons, for tax years 2015

and onwards, at the rates specified in Division IIA of Part I of the First Schedule, on income of every

person specified in the said Division.

For the purposes of this section, “income” shall be the sum of the following:—

(i) profit on debt, dividend, capital gains, brokerage and commission;

(ii) taxable income (other than brought forward depreciation and brought forward business losses)

under section (9) of this Ordinance, if not included in clause (i);

(iii) imputable income as defined in clause (28A) of section 2 excluding amounts specified in clause

(i); and

(iv) income computed, other than brought forward depreciation, brought forward amortization and

brought forward business losses under Fourth, Fifth, Seventh and Eighth Schedules.

The super tax payable under sub-section (1) shall be paid, collected and deposited on the date and in

the manner as specified in section 137 (1) and all provisions of Chapter X of the Ordinance shall

apply.

Where the super tax is not paid by a person liable to pay it, the Commissioner shall by an order in

writing, determine the super tax payable, and shall serve upon the person, a notice of demand

specifying the super tax payable and within the time specified under section 137 of the Ordinance.

Where the super tax is not paid by a person liable to pay it, the Commissioner shall recover the super

tax payable as these apply to the collection of tax under the Ordinance.

The Board may, by notification in the official Gazette, make rules for carrying out the purposes of this

section.