Tax Book 2023

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

Capital gain 270,000

270,000

6,842,000

COMPUTATION OF TAX LIABILITY:

Tax on Rs. 6,842,000 [1,005,000 + 32.5% x (6,842,000 - 1,278,650

6,000,000)]

Total & taxable income

(Cost of bonus shares computed on the basis of division of

original shares cost on total shares including bonus shares.)

(^528) ____ ___ _Conceptual Approach to Taxes
Less tax credit on
600,000

600,000

(112,129)

1,166,521

Approved voluntary pension fund (lower of actual amount

Rs.600,000 or 20% of taxable income i.e. Rs. 1,354,900)

(Assumed that other conditions required u/s 63 met by the

taxpayer)

Open – end mutual fund (No tax credit computed on this

investment as the same was made in the latest tax year and

further due to partial encashment within 24 months period the

tax credit of preceeding tax year shall be adjusted in the latest

tax year).

6,000,000)]

Less tax credit Rs. 1,278,650 / 6,842,000 x 600,000

1,166,521

(737,000)

40,000

Balance tax payable 469,521

Notes

Q.No. 3 (b) Spring 2013

Less tax deducted at source against salary income

Add reversal of tax credit due to disposal of units of open end

mutual fund

N-1: No treatment of security refunded after two years has been made in the current year as no further security

received in the current tax year by the landlord.

Imaginative Enterprise (IE) is an Association of persons and was formed two years ago. During the latest tax

Pakistan source income amounted to Rs.2,500,000 and tax payable thereon amounted to Rs. 722,500.

N-1: Donation paid to realtives is not entitled to tax credit u/s 61 of the ITO, 2001.

Heads of income Foreign income Foreign tax paid Foreign losses

brought forward

RUPEES RUPEES RUPEES

Speculation business 500,000 125,000 (250,000)

Non- Speculation business (1,000,000) - -

Capital gains 750,000 75,000 (1,500,000)

Other sources 1,250,000 187,500 -

Required:

Followingarethedetailsofitsforeignsourceincomes,taxpaidthereonandforeignlossesbroughtforwardfor

the latest tax year:

The foreign tax credit relating to Income from other sources which remained unadjusted during the last tax year

amounted to Rs.50,000.

Pakistan source income amounted to Rs.2,500,000 and tax payable thereon amounted to Rs. 722,500.

Required:

Calculate total tax payable and foreign tax losses to be carried forward to next year (if any).

Solution

Imagivative Enterprise (Resident AOP)

Computation of taxable income and tax liability

For the tax year 2023

Rupees Rupees

Foreign source of incomes :

Non speculation:

Current year loss (N - 1) (1,000,000)

Capital gain U/S 37

Current year income 750,000

Brought forward losses 1,500,000

(750,000)

(^528) ____ ___ _Conceptual Approach to Taxes