Tax Book 2023

Chapter 30 Solved Past Papers Income Tax Numericals of ICMAP Stage IV - (2003 to 2018)

Less: 20% repair allowance (140,000)

(14,000)

Legal expenses to defend the title of property (40,000)

Mark up (assumed paid on portion for personal use) -

(194,000)

506,000

Taxable income 6,109,750

Computation of Tax Liability:

Note Rupees Rupees

Tax on Income under NTR:

Tax on Rs. 5,000,000 1,005,000

Tax on balance

[Rs. (6,109,750 - 6,000,000) x 32.5%] 35,669 1,040,669

Admin & collection charges (admissible lower of actual and 4% of

rent chargeable to tax)

Conceptual Approach to Taxes _____757

[Rs. (6,109,750 - 6,000,000) x 32.5%] 35,669 1,040,669

Tax on terminal benefits (Rs. 5,650,000 x 13%) N- 8 & 11 734,500

Total tax liability 1,775,169

Less:Tax deducted at source

By employer 1,197,000

By tenant 22,000 1,219,000

Balance tax payable 556,169

Notes:

N-1: Conveyance Facility:

N-2: Benefit on Transfer of Car:

Benefit on transfer of car is computed as below:

Rupees

Fair market value of car 1,500,000

Mr.IsrarRazaservedwithSoftexLimited(SL)forninemonthshencesalary,allowancesandother

perquisites shall be computed on the basis of nine months.

Whenconveyanceisusedpartlyforbusinessandpartlyforprivatepurpose,5%ofthecostof

vehicleisincludedinsalaryincome.Asthefacilityisavailedforninemonths,9/12oftheamount

shall be included in the salary.

Fair market value of car 1,500,000

Less: Price paid to employer 1,000,000

Amount to be included in salary 500,000

N-3: Fuel Reimbursement:

Asperthecompanypolicy,Mr.Israrwasallowedtoreimbursefuelupto 250 litresbasedonactual

consumptionincarusedforbusinessandprivatepurposehence,suchreimbursementisexempt

from tax and shall not be included in the income from salary.

Conceptual Approach to Taxes _____757