Tax Book 2023

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

Income (Separate block):

Dividend received from BEE Limited

(78,200 + 9,200 + 4,600)

92,000

65,000

157,000

2,394,800

(4,600)

2,390,200

Total income

Since salary income is less than 75% of the taxable income,

Dividend received from a company in U.A.E

Taxable income

Less: Zakat

Conceptual Approach to Taxes ___ 515

15,000

148,775

163,775

(38,028)

• Total contribution paid by Wajahat
  (A)

890,000

478,040

382,432

Tax @ 12.5% on the amount exceeding Rs. 2,400,000 (i.e. on 1,190,200)

Which is lesser of (A), (B) or (C):

Since salary income is less than 75% of the taxable income,

therefore, the slab applicable to non-salaried individuals shall be

applied:

Tax on Rs. 1,200,000

Less: Tax credit on investment in pension: (555,000 x 263,040 /

2,465,200)

Tax payable under NTR

Computation of net tax liability:

• 20% of taxable income (2,390,200 x 20%)
  Add: 2% add. for each year of age above 40 years (2% x 8 x 382,432

(B) 860,472

555,000

125,747

23,550

Total tax liability for the year 149,297

Less: Tax withheld at source (Dividend) (9,200)

Balance tax payable 140,097

Q.1 Autumn 2015

Add: Tax payable on dividend income (157,000 x 15%) (FTR)

(Note 1) As the turnover during the tax year 2023 is less than Rs. 100 million hence mimimum tax u/s 113 is

not applicable on the taxpayer.

Add: 2% add. for each year of age above 40 years (2% x 8 x

2,390,200)

• 30% of last assessed taxable income (1,850,000 x 30%)
  (C)

Rupees

Basic salary (per month) 250,000

Medical allowance (per month) 37,500

Housing allowance (per month) 25,000

Travel allowance (per month) 11,500

In addition to above, Mukarram was also provided the following:

(i) Ausedcompanymaintainedcarforbothbusinessand personaluse.Thiscarwasprovidedtohim

on 1 July 2022 inreplacementofhispreviouscar.ThiscarwaspurchasedthreeyearsagoatapriceofRs.

1,000,000.However,thefairmarketvalueofthecaron 1 July 2022 wasRs.800,000.On 1 September2022,

MukarramisworkingasaCommercial ManagerinAirmenEngineeringLimited(AEL),anunlistedpublic

company, for the past many years. He derived following emoluments during the tax year ended 30 June 2023:

(v) Twoair-conditionersandawashingmachineforuseathome.Thecombined bookvalueofthese

applianceswasRs.300,000.TheappliancesarereturnabletoAELafterthreeyears’time.AELcharged

10% depreciation on these appliances.

(iv) Reimbursement of Rs. 20,000 in respect of telephone and internet charges. 20% of this amount was

spent by Mukarram in performance of his official duties.

1,000,000.However,thefairmarketvalueofthecaron 1 July 2022 wasRs.800,000.On 1 September2022,

inaccordancewiththetermsofhisemployment,AELtransferredthepreviouscartoMukarramfreeofcost.

Themarketvalueofthe caratthetime oftransfer wasRs.400,000whereasitsbookvaluewasRs.

200,000. On 1 June 2023, Mukarram sold this car to his neighbour at a price of Rs. 350,000.

(iii) Twofreebuffetdinnercouponspermonth,oneeachforMukarramandhiswifeinafivestarhotel.

Thecoupons wereprovided inlinewithAEL’spolicyforitsmanagementemployees.Thedinnercosts

AEL Rs. 2,000 per person.

(ii) Performance related bonus of Rs. 500,000. The bonus was however, paid to him on 5 July 2023.

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