June 2024 – Page 9 – Sailesh Bhandari & Associates

VALUATION OF PERQUISITES

Perquisite is a benefit or an advantage that an employee receives from his/her employer over and above the salary. Perquisites are taxable under the head “Income from Salary”. The value of perquisites is determined as per the Income Tax Act, 1961 and the Income Tax Rules, 1962. The valuation of perquisites depends on the nature

WHEN ENHANCED COMPENSTATIONS IS PAID BUT IT IS SUBJECT – MATTER OF DISPUTE

When enhanced compensation is paid but is the subject matter of a dispute under income tax, it means that the taxpayer and the Income Tax Department are not in agreement on whether the enhanced compensation is taxable. This can happen for a number of reasons, such as: If the taxpayer and the Income Tax Department

COMPUTATION OF CAPITAL GAINS ON TRANSFER OF FIRMS ASSESTS RTO PARTNERS AND VICE VERSA

When a firm transfers an asset to a partner: The fair market value (FMV) of the asset on the date of transfer is deemed to be the full value of the consideration received or accrued as a result of the transfer. The capital gain is computed as follows: Capital gain = FMV of the asset

SUPREME COURT RESPONSIBLE FOR RULING THIS RULE

The Supreme Court of India is the apex court of the Indian judiciary and is responsible for interpreting the Constitution of India and upholding the rule of law. The Supreme Court also has the power to issue writs and orders to enforce fundamental rights and to direct the government to comply with constitutional and legal

CERTAIN TRANSACTION NOT INCLUDED IN TRANSFER

Under the Income Tax Act, 1961, certain transactions are not regarded as transfers of capital assets. This means that capital gains tax is not payable on such transactions. Here are some examples of certain transactions not included in transfer under income tax: It is important to note that there are certain conditions that need to

HOW TO DETERMINE PERIOD OF HOLDING

The period of holding of a capital asset under income tax is the period between the date of its acquisition and the date of its transfer. The date of acquisition is different for different types of assets, as follows: The period of holding is calculated in days, and includes both the date of acquisition and

COMPUTATION OF RELEF IN RESPECT OF OTHER PAYMENTS

Computation of relief in respect of other payments under income tax Section 89 of the Income Tax Act, 1961 provides for relief in respect of certain incomes which are received in a particular year but relate to an earlier year. This relief is available to the taxpayer to prevent him from being taxed on the

APPROVED SUPERANNUATION FUND

An approved superannuation fund under income tax is a retirement savings scheme that has been approved by the Indian government. It is a tax-efficient way to save for retirement, as employers’ contributions to the fund are tax-deductible, and employees’ contributions are exempt from tax up to a certain limit. The income earned by an approved

PROFESSIONAL TAX OR TAX ON EMPLOYMENT [SEC.16 (iii)]

Professional tax is a tax levied by the state governments in India on all persons earning an income by way of either practising a profession, employment, calling or trade. It is a direct tax, meaning that it is paid directly to the government. Professional tax is levied under Section 16(iii) of the Income Tax Act,

BASIS OF VALUVATION

The basis of valuation under income tax is the fair market value of the asset on the valuation date. Fair market value is defined as the price that the asset would fetch if sold in a willing buyer-willing seller transaction on the valuation date. The Income Tax Act and Rules provide specific methods for valuing

2024 June