Tax Book 2023

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

Tax on income under NTR for salaried individual:

Tax on Rs.1,200,000 15,000

Tax @ 12.5% on [1,692,600 - 1,200,000] 61,575 76,575

Add tax on profit on PLS account (Rs.10,000 x 15%) 1,500

Total tax liability 78,075

Less tax already paid / deducted at source

Tax deducted on profit on PLS account U/S 151 (1,500)

Balance tax payable 76,575

NOTES:

(N - 1) House rent allowance is totally taxable.

(N - 2) Medical Allowance: Rs.

784___ Conceptual Approach to Taxes

Medical Allowance 80,000

Less exempt upto 10% of basic salary U/C 139 (840,000 x 10%) 84,000

• (N - 3) Contribution towards recognized provident Fund:

Employer's contribution to provident fund (Rs. 168, 000/2) 84,000

(Equal contributiion by the employer company)

92,400

OR Rs. 150,000. 150,000 92,400

(N - 4) Rs.

Amount of interest credited 300,000

308,000

Nothingwillbeincludedintotalincomeofthetaxpayerasthecontributioniswithinthe

exemptionlimit. Salaryforprovidentfund purposesmeanbasicsalaryplusdearness

allowance(i.e.Rs. 840,000+84,000). Notreatmentof employee contributionasthe

same is already included in taxable salary of the employee.

Less: Exempt upto lower of 10% of salary

(924,000 x 10%)

Less exempt higher of 1/3rd of salary (Rs. 924, 000/3) or 308,000

Taxable amount -

(N - 5) Capitalgainon saleofsharesoflistedcompaniesistaxableasaseparateblockof

Interestcreditedtoaprovidentfundisexemptuptothehigherofone-thirdofsalaryor

amountoninterestcalculated@16%p.a.Astherateofinterestisnotgivenhence1/3

rd of salary has been taken as exempt.

Less exempt higher of 1/3rd of salary (Rs. 924, 000/3) or

interest @ 16% p.a.

784___ Conceptual Approach to Taxes