Tax Book 2023

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

Tax Year 2023

Individual

Resident

INCOME FROM SALARY Rupees Rupees

Basic salary (Rs. 200,000 x 12 months) 2,400,000

360,000

Computation of taxable income and tax liability

Medical allowance (Although exempted upto 10% of basic

salary, clause 139 of 2nd schedule, however as the medical

(^540) ____ ___ _Conceptual Approach to Taxes
200,000
120,000

• 180,000
  1,080,000

Conveyance provided by employer:

90,000

• FMV of shares at the date when employee has free right to -

Medical insurance and hospitalization fully exempt U/C 139

Payment of his children's school fees (N -1)

Rent free furnished accommodation (45% of basic salary shall

be included in the salary income assumed equal to FMV)

Wholly for business use (Fully exempt)

Leave encashment received on 5 July 2023 (N - 2)

Partly for personal and business use (5% of FMV of leased

vehicle) (1,800,000 x 5%)

salary, clause 139 of 2nd schedule, however as the medical

facility has also been given in the question therefore the same is

fully chargeable to tax)

Utility allowance (Rs. 10,000 x 12 months)

One month basic salary employer contributed towards pension

fund (As benefit)

4,430,000

INCOME FROM PROPERTY

Rental income (Rs. 22,000 x 12 months) 264,000

13,200

Income from property 277,200

(55,440) 221,760

CAPITAL GAINS U/S 37

90,000

FMV of shares at the date when employee has free right to

transfer (already included as benefit in the salary income of the

tax year 2022)

Non-adjustable advance ((150,000-(90,000 / 10 x 2)/10)

Less: 20% repair allowance

On sale of (Pvt.) Ltd. company shares, therefore gain shall be

taxable as capital gain shares {15,000 x (Rs.48-Rs.42)]

Leave encashment received on 5 July 2023 (N - 2)

INCOME FROM OTHER SOURCES

750,000

Total income 4,741,760

(250,000)

Taxable Income 4,491,760

COMPUTATION OF TAX LIABILITY: (As

a salaried individual)

Tax liability under NTR

Tax on Rs. 4,469,260 [405,000 + 25% x (4,469,260 - 3,600,000)] 622,315

taxable as capital gain shares {15,000 x (Rs.48-Rs.42)]

Zakat paid under the Zakat and Ushr Ordinance

Profit on fixed deposit account maintained with a bank (SBI as

FTR)

622,315

Less: Tax credit on contribution to approved pension fund (although

paid by employer but the same is on behalf of employee)

Tax credit u/s 63 shall be allowed on lower of:

• Actual amount of contribution i.e. Rs. 200,000


• 20% of taxable income i.e. Rs. 898,352
  Tax credit = (200,000 x 622,315 / 4,491,760) (2,770)
  619,545
  Tax liability under FTR
  112,500
  Total tax liability 732,045

(650,000)

Tax deducted on PLS (112,500)

Tax on Rs. 4,469,260 [405,000 + 25% x (4,469,260 - 3,600,000)]

Tax on profit on fixed deposit Rs. 750,000 @ 15%

Less: Tax deducted at source from his salary

(^540) ____ ___ _Conceptual Approach to Taxes