Tax Book 2023

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

INCOME FROM PROPERTY

350,000

Less: 20% repair allowance (70,000)

(291,667)

Property tax paid (35,000)

(46,667)

Taxable income (under NTR) 8,382,000

Rental Income (Rs. 50,000 x 7 months) (gross amount)

Mark up on loan for purchase of apartment (Rs. 5 million x 10%

x 7/12)

Net loss under the head income from property [No loss can be

adjusted against income from salary u/s 56]

Conceptual Approach to Taxes ___ 561

8,382,000

Q.NO. 15: Spring 2005

Mr “B” is the Chief Executive of a Multinational Company. Details of his emoluments are as follows:

Rs.

Basic Salary 8,800,000

Bonus 5,000,000

Utility allowance 880,000

Relocation allowance 200,000

Apart from the above he is provided with the following perquisites/benefits:

(i) A free unfurnished accommodation by the employer with land area of 2100 sq. yds.

(ii) Motor vehicle for both private and official use, cost of acquisition of which was Rs.2,000,000.

Taxable income (under NTR)

Note -1 Grant of an option or right is not taxable whereas exercise of an option to acquire shares is taxable

where the same is without restriction and limitation.

(ii) Motor vehicle for both private and official use, cost of acquisition of which was Rs.2,000,000.

(iii) Children education fees for the year Rs.105,000.

(iv) House servant salaries for the year Rs.230,000.

(a) Rent Rs.50,000 per month.

(b) The property was let out on rent from December 2, 2022 to June, 2023

(c) Property tax paid Rs.35,000.

The Bank account of Mr. “B” was credited with profit during the year amounting to Rs.6,300. During the year

the following amounts were withheld at source as Income Tax:

AccordingtothetermsofemploymentthetaxliabilityofMr.“B”ontheabovebenefitsandperquisitesfrom(i)

to (iv) above is borne by the employer. Tax liability on other remuneration is borne by himself.

Mr.“B”alsoownsapropertywhichwasletoutonrentforapartoftheyeardetailsofincomeandexpenses

incurred are as follows:

Rupees

From salary income 4,541,250

Tax paid by the employer 446,820

From profit on bank account 630

On receipt of rent 17,500

You are required to compute the taxable income and tax liability of Mr. “B” for the tax year 2023.

Solution of Q.No. 15 Spring 2005

Name of Taxpayer : Mr. B

National Tax Number :

Income year ended : June30, 2023

Tax Year : 2023

Personal Status : Individual

(Rs.) (Rs.)

INCOME FROM SALARY

Basic Salary 8,800,000

Bonus 5,000,000

Utility allowance 880,000

Relocation allowance 200,000

Free unfurnished house higher of (FMV or 45% of MTS or Basic pay)

(45% of Rs. 8,800,000) is taxable 3,960,000

Conveyance facility partly for personal use (5% of Rs. 2,000,000) 100,000

Children education fees for the year 105,000

House servant salaries for the year 230,000

Tax paid by employer 446,820

19,721,820

Personal Status : Individual

Residential Status : Resident

Conceptual Approach to Taxes ___ 561