Monday, July 21, 2008

Income Tax (Definition)

What is Income Tax?
  • Taxes in India are of two types, Direct Tax and Indirect Tax.
  • Direct Tax, like income tax, wealth tax, etc. are those whose burden falls directly on the taxpayer.
  • The burden of indirect taxes, like service tax, VAT, etc. can be passed on to a third party.
Income Tax is all income other than agricultural income levied and collected by the central government and shared with the states.

According to Income Tax Act 1961, every person, who is an assessee and whose total income exceeds the maximum exemption limit, shall be chargeable to the income tax at the rate or rates prescribed in the finance act. Such income tax shall be paid on the total income of the previous year in the relevant assessment year.

The total income of an individual is determined on the basis of his residential status in India.

Residence Rules

An individual is treated as resident in a year if present in India
  1. for 182 days during the year or
  2. for 60 days during the year and 365 days during the preceding four years. Individuals fulfilling neither of these conditions are nonresidents. (The rules are slightly more liberal for Indian citizens residing abroad or leaving India for employment abroad.)

A resident who was not present in India for 730 days during the preceding seven years or who was nonresident in nine out of ten preceding yeas is treated as not ordinarily resident. In effect, a newcomer to India remains not ordinarily resident.

For tax purposes, an individual may be resident, nonresident or not ordinarily resident.

Non-Residents and Non-Resident Indians
Residents are on worldwide income. Nonresidents are taxed only on income that is received in India or arises or is deemed to arise in India. A person not ordinarily resident is taxed like a nonresident but is also liable to tax on income accruing abroad if it is from a business controlled in or a profession set up in India.

Capital gains on transfer of assets acquired in foreign exchange is not taxable in certain cases.

Non-resident Indians are not required to file a tax return if their income consists of only interest and dividends, provided taxes due on such income are deducted at source.

It is possible for non-resident Indians to avail of these special provisions even after becoming residents by following certain procedures laid down by the Income Tax act.

StatusIndian incomeForeign income
Resident and ordinarily residentTaxableTaxable
Resident but not ordinary residentTaxableNot Taxable
Non-ResidentTaxableNot Taxable

18 comments:

  1. With the help of Karl Lagerfeld French fashion house Chloe helped shape the era that fashion is so obsessed with right now. Chloe Dafne sunglasses have an authentic vintage feel. It’s got all the hallmarks of a great seventies sunglass. It’s supersized, has sleek gold metal and Ray Ban Sunglassses ultra flattering gradient lenses. Chloe Dafne also recreates perfectly the era’s taste for bold angles in ray ban sunglasses sunglasses.Chrissy’s leaving a New York hotel with husband John Legend. It’s New York Fashion week. Earlier ray ban sunglasses that day Chrissy braved the snow sans fur in a plunging neck line to attend the Ray Ban Sunglassses Badgley Mischka show.
    She’s the face of the SS15 Givenchy ready-to-wear campaign. But it's not the www.rbodm.com legendary french fashion house she looks to shade her eyes here. Julia Roberts is quite happy cheap ray ban sunglasses in her Ray-Ban sunglasses. Taking a break from filming, she slips into the Meteor. It's a Ray Ban Sunglassses Sale sunglass Ray-Ban brought back from its sixties archive a couple of years ago. A superb alternative Ray Ban Outlet to Ray-Ban’s classic Wayfarer it sets you apart from the rest. Like the Ray-Ban original 2140 ray bans on sale Wayfarer it’s a true vintage style too. Julia is filming The Secret in Their Eyes, she Ray Ban Sale stars alongside Nicole Kidman. There's no secret about Julia's eyes right now, Ray-Ban's lens and temple cheap ray ban sunglasses sale under 30$ sguiggle are unmistakable.
    Whether Rihanna’s off duty or not, she’ll always be in fine designer ray ban aviators sunglasses. She’s arriving at JFK here in long black down coat, brown suede boots and grey ray ban outlet beanie hat. She shields her eyes from the paparazzi with one of Celine’s latest sunglasses. The ray ban wayfarer Frida is a thick round with an ultra flat top. The house’s jewellery inspired tie hinge ray ban one day sale 90% off details decorate.Rihanna was crowned Fashion Icon at the CFDA awards last year. She has the sunglasses ray ban clubmaster collection to prove it.

    ReplyDelete
  2. Poisoned bait is a common method for controlling rat populations, however is not as effective when there are other food sources around, such as garbage. Poisoned meats have been used for centuries for killing off wolves, birds that were seen to threaten crops, and against other creatures. This can be a problem, since a carcass which has been poisoned will kill not only the targeted animal,
    شركة مكافحة حشرات بالرياض شركة مكافحة النمل الابيض بالرياض شركة مكافحة حشرات بالدمام شركة مكافحة النمل الابيض بالدمام شركة مكافحة حشرات بالخبر شركة مكافحة حشرات بالجبيل شركة مكافحة حشرات بابها شركة مكافحة حشرات بالطائف شركة مكافحة حشرات بجازان

    ReplyDelete
  3. Poisoned bait is a common method for controlling rat populations, however is not as effective when there are other food sources around, such as garbage. Poisoned meats have been used for centuries for killing off wolves, birds that were seen to threaten crops, and against other creatures. This can be a problem, since a carcass which has been poisoned will kill not only the targeted animal,شركة مكافحة حشرات بالقصيم شركة مكافحة حشرات بجدة شركة مكافحه النمل الابيض بالقصيم شركة مكافحة النمل الابيض بجدة شركة مكافحة حشرات بحائل شركة مكافحة النمل الابيض بحائل شركة مكافحة النمل الابيض بالمدينه المنوره شركة مكافحة حشرات بتبوك شركة مكافحة حشرات بالخرج


    ReplyDelete
  4. Poisoned bait is a common method for controlling rat populations, however is not as effective when there are other food sources around, such as garbage. Poisoned meats have been used for centuries for killing off wolves, birds that were seen to threaten crops, and against other creatures. This can be a problem, since a carcass which has been poisoned will kill not only the targeted animal,شركة مكافحة حشرات بالقصيم شركة مكافحة حشرات بجدة شركة مكافحه النمل الابيض بالقصيم شركة مكافحة النمل الابيض بجدة شركة مكافحة حشرات بحائل شركة مكافحة النمل الابيض بحائل شركة مكافحة النمل الابيض بالمدينه المنوره شركة مكافحة حشرات بتبوك شركة مكافحة حشرات بالخرج


    ReplyDelete
  5. but also every other animal which feeds on the carcass. Humans have also been killed by coming in contact with poisoned meat, or by eating an animal which had fed on a poisoned carcass. This tool is also used to manage several caterpillars e.g. Spodoptera litura, fruit flies, snails and slugs, crabs etc.
    شركة مكافحة حشرات بالاحساء شركة مكافحة النمل الابيض بالمدينه المنوره +++ we wait you here شركة تنظيف منازل بالرياض شركة تنظيف مجالس بالرياض شركة تنظيف موكيت بالرياض شركة مكافحة حشرات بالرياض


    ReplyDelete

  6. but also every other animal which feeds on the carcass. Humans have also been killed by coming in contact with poisoned meat, or by eating an animal which had fed on a poisoned carcass. This tool is also used to manage several caterpillars e.g. Spodoptera litura, fruit flies, snails and slugs, crabs etc. شركة مكافحة النمل الابيض بالرياض شركة رش مبيدات بالرياض شركة نقل عفش بالرياض شركة كشف تسربات المياه بالرياض شركة تسليك مجارى بالرياض شركة تنظيف فلل بالرياض

    good good good

    ReplyDelete
  7. After reading and understanding this article. in my opinion this is very useful . cara menggugurkan kandungan dan mempercepat haid

    ReplyDelete