Tax Book 2023

Chapter 21 ___Solved Past Papers Income Tax Numericals of CA Module C - (2001 to 2022)

Expenses u/s 15A

20% repair allowance (15,000)

(31,875) 28,125

INCOME FROM BUSINESS

Loss from business 2 (750,000) (28,125)

INCOME FROM CAPITAL GAINS

Mark up paid for purchase of apartment (Rs. 127,500 x 3/12)

Conceptual Approach to Taxes ___ 537

Gain on sale of quoted shares 3 200,000 -

Capital loss on sale of private company

shares

4 (500,000) -

Sale of personal car 5 300,000 -

Total income 21,140,000

Total income 21,140,000

(16,525,000)

4,615,000

(127,500)

Taxable income 4,487,500

COMPUTATION OF TAX LIABILITY:

Tax on Rs. 4,487,500 [405,000 + 25% x 626,875

Less: deductible allowance for markup on housing loan

Less: Income to be taxed separately - Gratiuty & Golden

handshake

Tax on Rs. 4,487,500 [405,000 + 25% x

(4,487,500 - 3,600,000)]

626,875

Tax on Rs. 16,525,000 (golden handshake)

at 13%

6 2,148,250

2,775,125

25,000

2,800,125

Add recouped tax credit U/S 62 3 60,000

(3,750,000)

Balance tax refundable (889,875)

Notes

1. Rental income

Add tax on capital gain on quoted Company shares (Rs.

200,000 x 12.5%) covered under Fixed tax regime acquired

after 1-7-2016 but before 1-7-2022

Tax deducted at source by bank from salary income

1. Rental income


2. Business loss


3. Gain on sale of quoted shares

Therentreceivedorreceivablebyapersonforataxyearshallbechargeabletotaxinthatyearunderthe

head“Incomefromproperty”.Therefore,onlythreemonths’rentistaxableunderNTRofMr.Khursheed.

Further admissible deductions allowed under section 15A of the Ordinance has also available to an individual.

Since, the sale of listed company's shares is made before July 01, 2022, the gain on sale of shares is taxable

@ 12.5%.

Noloss(includingLossundertheheadbusinessincome)shallnotbesetoffagainstincomefromsalary.

Howeverbusinesslosstotheextentofnetincomefrompropertyhasbeenadjustedandbalancelossshallbe

carried forward to adjust the same against the business income of six subsequent tax years.

4. Capital loss


5. Sale of personal car

@ 12.5%.

Furthermore,thetaxcreditofRs.60,000allowedinthetaxyear 2022 willberecoupedasthesamehasbeen

disposed off within twenty four months from the date of purchase has been elapsed.

Whereapersonsustainsalossonsaleofsharesofaprivatecompanyitisconstruedasacapitallossandit

cannotbeset-offagainstanyotherheadofincome,butshallbecarriedforwardtothenextyearandsetoff

against the capital gain, if any.

Income under the head ‘Capital gains’ can arise only on the disposal of a capital asset. Since movable assets

held for personal use are excluded from the definition of capital asset, gain on sale of car is not a taxable

income in the hands of the Mr. Khursheed.

Conceptual Approach to Taxes ___ 537