Introduction to Income Tax

67 %
33 %
Information about Introduction to Income Tax
Education

Published on December 14, 2017

Author: toe4u2012

Source: authorstream.com

slide 1: Direct Tax Tripathi Online Educare slide 2: Introduction Tripathi Online Educare slide 3: Tax Laws ● Government can raise funds needed for the development and defence of the country by collecting taxes such as Income-tax excise duties service tax etc from the citizens. ● As the revenue collected from income-tax helps the development of the country it is said that “income-tax is the price one pays for the civilisation”. ● Constitution is the parent law in India and all other laws should be enacted without exceeding the framework of the constitution and subject to the norms laid down therein. ● Under the Constitution of India the Central Government has the right to collect income tax. ● The law governing such collection of income-tax is ○ Specified in the Income-tax Act 1961 “the Act” ○ Implemented according to the rules laid down in the Income-tax Rules 1962 “the Rules” ○ Administered through the circular issued by the Central Board of Direct Taxes “CBDT” ○ Interpreted by the judgement of the Supreme Court and High Courts which settle the legal disputes between the Government taxpayers. Tripathi Online Educare slide 4: Scope of Study ● In this course we will be discussing the provisions of Income Tax Act 1961 as amended upto date and applicable to Assessment Year 2017-18. ● We will be studying basically only Sections 1 to 80 of the Act which deal with - ○ The basic concept of the income-tax law such as what is income whose income is taxable income of what period is taxable how the income is to be computed and so on. ○ The provisions relating to the computation of total income under various heads such as Salaries House Properties Business or Profession Capital Gains Other Sources ○ The deductions available from total income on savings for blind individuals on mediclaim insurance on contribution to pension fund etc. ● With this background let us now begin our detailed study of the Income-tax Act. Tripathi Online Educare slide 5: Scheme of Act ● Just as a book is divided into chapters and paragraphs the Income-tax Act is divided into chapters from I to XXIII ie 1 to 23. ● Each chapter is divided into sections 298 in all. ● Each section deals with a specific matter provision and is further divided into subsections clauses and subclauses. ● Thus S.172ci means section 17 subsection 2 clause c subclause i. ● An “explanation” to section clarifies certain word or point of law in the section. ● A “proviso” to a section indicates an exception to the provision or a pre condition to be satisfied or how the section is to be applied in a peculiar situation. ● Any change amendment in the Act is made through the Finance Act Budget passed every year. Tripathi Online Educare slide 6: What is Income Tax ● Income Tax is a tax on Income earned by a person. ● Any person who is having the Income in excess of non-taxable limit is required to pay tax. ● The term Income is well defined under the Income Tax Act. ● Law has taken proper care to cover all sorts of income and receipts of gains in the hands of person chargeable to tax. ● It defines the term person in such a fashion that each and every sort of entity is covered. ● It also states clearly what income is not chargeable to tax. ● There are certain income which are exempt upto certain limit and thereafter chargeable to tax. ● Thus the technique of Computation of Income depends upon the classification of Income under different heads of Income. Tripathi Online Educare slide 7: What is Income Tax ● Deduction have also been specified under each head of Income to ascertain the Income chargeable to tax under respective head. ● Over and above there are certain admissible deduction which have been stated to be deducted from the Gross Total Income so as to arrive at the Net Taxable Income. ● Having derived the Net Taxable Income a person calculates his Gross Tax Liability. ● Then he considers whether there is any tax deduction at source TDS. ● After reducing the TDS from Gross Tax Liability he arrives at the final Net Tax Liability. ● Apart from this the act also describes various tax Authorities procedure of assessment collection and recoveries interest and penalties appeal and revisions offences and prosecutions etc. ● These all are well dealt with in the 298 sections of the Income Tax Act 1961 as amended upto date. Tripathi Online Educare slide 8: What is Income Tax ● There are hundreds of sub section clauses sub clauses explanations and proviso to these 298 sections. ● Along with it quite good number of circulars are issued by the department to clarify various provisions of the Act. ● This act is been amended very frequently and drastically too. ● These amendments is effected through the Finance bill introduced in the parliament by the Finance Minister. ● Once the Finance bill is approved by the parliament and gets the assent of the parliament it becomes the Finance Act. ● Thus the Finance Act makes the amendment in the form of omission insertions and substitutions in the Income Tax Act. Tripathi Online Educare slide 9: What is Income Tax ● One finds it very difficult to trace the correct provision of law at it is applicable as on a particular day though it is not impossible. ● The Act provides for determination of Total income of the assessee. ● It does not provide for rate of tax. ● The rate of tax on the total income is decided every year by passing the Finance Act. Tripathi Online Educare slide 10: Extends to whole of India S.1 S.1 states that 1. This Act may be called the Income-tax Act 1961 2. It extends to the whole of India. Thus the Act is applicable to persons residing in India as well as to the income arising in India. Tripathi Online Educare slide 11: Modules at a Glance Tripathi Online Educare slide 12: Modules in Brief Tripathi Online Educare slide 13: Modules in Brief Tripathi Online Educare slide 14: Match the Columns Tripathi Online Educare slide 15: Tripathi Online Educare slide 16: True or False Tripathi Online Educare slide 17: ● The Income Tax Act is applicable to whole of India. Ans: True ● The Income Tax Act came into force from financial year 1962-63. Ans: False ● The rate of tax on the total income is decided every year by passing the Finance Act. Ans: True ● The Finance Bill makes the amendment in the form of omission insertions and substitutions in the Income Tax Act. Ans: False True or False Tripathi Online Educare slide 18: ● The Finance Minister introduces the Finance Bill in the parliament Ans: True ● The constitution of India empowers Central Government to levy tax on Income. Ans: True ● Gross Tax Liability is calculated on Gross Total Income. Ans False ● Finance Bill becomes Finance Act after the assent of parliament. Ans: True True or False Tripathi Online Educare slide 19: ● Income tax in India is governed by the Income tax Act 1961. Ans: True ● Income tax is a tax on tax. Ans: False ● The Finance Act is substitute to Income tax Act. Ans: False ● The Income Tax Act has 289 sections. Ans: False True or False Tripathi Online Educare slide 20: MCQ Tripathi Online Educare slide 21: Income Tax is a tax on _________. 1. Income 2. Profit 3. Turnover 4. Expenditure Multiple Choice Questions The Income Tax Act extends to ________ of India. 1. States 2. Union Territories 3. Citizens 4. Whole Tripathi Online Educare slide 22: Multiple Choice Questions Gross Tax Liability is calculated on _______________. 1. Gross Total Income 2. Net Taxable Income 3. Income 4. Salary The constitution of India empowers ____________ to levy tax on income. 1. State Government 2. Central Government 3. Parliament 4. Finance Minister Tripathi Online Educare slide 23: Multiple Choice Questions The ___________ makes the amendment in the form of omission insertions and substitutions in the Income Tax Act 1.Finance Bill 2.Finance Minister 3.Finance Act 4. Parliament The Income Tax Act 1961 has 298 __________. 1.Sections 2.Sub Sections 3.Clauses 4.Sub Clauses Tripathi Online Educare slide 24: Multiple Choice Questions The rates of Income Tax are laid down 1. For each calendar year 2. For each assesment year 3. For each previous year 4. For each head of Income Total Income 1. Of one calendar year is charged to tax in the succeeding calendar year 2. Of one financial year is charged to tax in the succeeding calendar year 3. Of one financial year is charged to tax in the succeeding financial year 4. Of once financial year is charged to tax in the preceding financial year. Tripathi Online Educare slide 25: Multiple Choice Questions The law governing income tax is specified in The Income Tax Act _______ 1. 1961 2. 1962 3. 1963 4. 1964 The rules for implementation of income tax are contained in Income Tax Rules _________ 1. 1961 2. 1962 3. 1963 4. 1964 Tripathi Online Educare slide 26: Thank You Tripathi Online Educare

Add a comment

Related presentations