Chapter 21 ___ Solved Past Papers Income Tax Numericals of CA Module C - (2001 to 2022)
(ii) On 30 June 2022, Aakash earned capital gains of:Note:
Ignore minimum tax under section 113.
Show all relevant exemptions, exclusions and disallowances.(a) Rs. 20 million on sale of his immovable property (apartment) which was purchased on 1 June 2020.
(b) Rs. 3.6 million on sale of shares in a private company. These were acquired on 1 June 2022.
(iii) During the year, Aakash received his share of profit from an AOP of Rs. 70 million.
Required:
Under the provisions of the Income Tax Ordinance, 2001 and Rules made thereunder, compute total income,
taxable income and net income tax payable by or refundable to Aakash for the tax year 2023.(^474) ____ _ _Conceptual Approach to Taxes
Show all relevant exemptions, exclusions and disallowances.
Answer
Aakash
For tax year 2023
Rs. in million
Income from business (87)
Loss before tax
Add: Inadmissible expenses / admissible income
2.40
Accounting depreciation 40.00
Computation of total income, taxable income and net tax payable/refundable
Commission expense disallowed due to sale to inactive tax
payer [2.5-0.1(50×0.2%)]
Accounting depreciation 40.00
Bad debts recovered from Shameem [16.8-6(19.2-13.2)] 10.80
Outstanding payments for more than 3 years 14.00
Financial charges waived by the bank 2.80
70.00
Less: Admissible expenses and inadmissible / FTR income
Freight charges paid in cash
Tax depreciation (48)
Insurance claim received (6)
Loss on disposal of vehicle (W-1) (1.20)
(27.40)
(3.40)
Penalty - no treatment as it is not against the voilation of any
Rule or Regulation
Reversal of Bad debts recovered recorded as other income
(16.8+10.6)
Bad debts recovered from Faheem [10.6-14(28.8-14.8)]
Rental income – Chargeable under income from other sources (21.60)
(107.60)
Income from non-speculation business (124.60)
Income from speculation business
Net gain from derivative contract 23
Income from business (A) (102)
Capital gain
Sale of apartment - No tax as sold after two years 20.00
Sale of private company shares 3.60
(B) 23.60
Income from other sources
Rental income from leasing of property comprised of building 21.60 21.60
Less: Deductions
Repair and maintenance (actual) (3.20)
Depreciation of building
(85×90%×90%×10%)
(6.90)
Depreciation of plant (34×15%) (5.10)
(C) 6.40
Rental income from leasing of property comprised of building
and second hand locally purchased plant (1.8×12)
(^474) __ ___ _Conceptual Approach to Taxes