Page 8 – Sailesh Bhandari & Associates

SECTION 35(1)

Section 35(1) (ilia) of the Income Tax Act1961 (ITA) allows a deduction for any sum paid to an approved scientific research company to be used by it for scientific research. The deduction is allowed at 100% of the amount so paid. The approved scientific research companies are notified by the Central Government. A list of

Depreciation on straight – line basis in the case of power unit under Income Tax Act

Under the Income Tax Act, 1961, power units are eligible for a depreciation rate of 15% on straight line basis. This means that the depreciation amount for a power unit can be claimed as a deduction from taxable income at the rate of 15% per year for the useful life of the asset. The useful

Section 30 of the Income Tax Act, 1961

Section 30 of the Income Tax Act, 1961 allows for deductions in respect of rent, rates, taxes, repairs and insurance for premises used for the purposes of business or profession. The following deductions are allowed under section 30 of Income Tax act: The explanation to section 30 of Income Tax Act clarifies that the amount

SPECIAL PROVISIONS IN THE CASE OF A NON – RESIDENT INDIA

There are a number of special provisions under the Income Tax Act, 1961, for Non-Resident Indians (NRIs). These provisions are designed to attract and retain NRI investment in India and to promote economic growth. One of the most important special provisions is the concessional tax rate on investment income. NRIs are taxed at a rate

PROVISIONS APPLICABLE IN THE CASE OF DISSOLUTION OR RECONSTITUTION FROM THE ASSESSMENT YEAR

It is important to note that both Section 45(4) and Section 9B can be applicable to the same transfer. For example, if a firm transfers a capital asset to a partner on the dissolution of the firm, the firm will be liable to pay capital gains tax under Section 45(4), and the partner will be

COMPUTATION OF CAPITAL GAIN IN THE CASE OF CONVERSION OF CAPITAL ASSEST INTO STOCK IN TRADE

When a capital asset is converted into stock in trade, it is considered to be a transfer of the capital asset and attracts capital gain provisions under the Income Tax Act, 1961. However, the capital gain is not taxable in the year of conversion, but in the year in which the converted asset is actually

TRANSFER OF CAPITAL ASSEST

Transfer of capital assets under income tax refers to the disposal of a capital asset by a taxpayer. A capital asset is any property held by a taxpayer, whether or not connected with the taxpayer’s business or profession, except for certain specific exclusions such as personal effects, agricultural land, and stock-in-trade. The following are some

RELIEF FROM TAXATION IN INCOME FROM RETIREMENT ACCOUNT MAINTAINED IN A NOTIFIED COUNTRY

Section 89A of the Income-tax Act, 1961 (ITA) provides relief from taxation in income from retirement account maintained in a notified country. A specified account means an account maintained in a notified country for retirement benefits. The income from such account is not taxable on an accrual basis but is taxed by such country at

APPROVED GRATUITY FUND

An approved gratuity fund under income tax is a fund that has been approved by the Income Tax Department of India. Once approved, the employer can deduct contributions to the fund from the employee’s salary and the employee will not have to pay income tax on the contributions. The employer can also claim a deduction

ENTERTAINMENT ALLOWANCE

Entertainment allowance under income tax is a tax deduction that is available to government employees. It is intended to cover the cost of entertaining clients, customers, and other business associates. The deduction is available under Section 16(ii) of the Income Tax Act, 1961. The amount of deduction that can be claimed is the least of

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