Incom, Agriculture income, Casual Income etc In Income Tax

Every person, whose taxable income for the previous financial year exceeds the minimum taxable limit is liable to pay to the central government income tax during the current financial year on the income of the previous financial year at the rates in force during the current financial year.

  In India, income tax was introduced for the first time in 1860, by Sir James Wilson. 

According to Sec. 2 (45) total income means the amount left after making the deductions under Sec. 80C to 80U from the gross total income. 

 The total income is computed on the basis of the residential status of the assessee in the manner provided here under and is classified into the following five heads:

 (a) Income from salaries. 

(b) Income from house property. 

(c) Profits of business or profession.

 (d) Capital gains. 

 The aggregate of the income under the following heads is known as gross total income:

 (a) Income from salarles.

 (b) Income from house property.

 (c) Profit and gains of business or profession. 

(d) Capital gainş.

 (e) Income from other sources. 

Casual income is that income the (receipt of which is accidental and without any stipulation.) It is in nature of an unexpected wind-fall.

 

According to Sec. 2(31) 

'Person' includes the following: 

(a) An Individual. 

(b) A Hindu Undivided Family (HUF)

. (c) A company. 

(d) A Firm.

 (e) An Association of Persons or A Body of Individuals. (2015, 17)

 According to Sec. 3 of the Act previous year means the financial year immediately eai so d ogren ur a sanawo aao pur aassasse ao raf sse an For example, for current year 2019-20 the previous year would be 2018-19, Le 1+2018 to 31- 3-2018

 

Tax planning may be defined as an arrangement of one is financial and tax affairs in such a maRDer that without violating in any way legal provisions under the tax and other laws, fll advantage is taken of all tax exemption deduction, concessions, rebates, allowances and benefits permitted under the tax laws so that the burden of taxation on the tax payer is reduced to the

 

Short-termtx planning means a planning for current year only. Under it an assessee make tax planning for the previous year and ascertains the channels of investments so that his tax liability for the previous year is reduced to the minimum. 

 Long-term tax planning means a planning for future. Under it an assessee makes investment in such plans or scheme which help him in reducing his future tax liability. 

. Investment tax planning means a planning for investments income which creates minimum tax ability. Investment yield income in forrm of interest or dividends. 

Tax avoidance is a technique by which income, expenditure and investment of an assessee are so arranged that without violating tax laws tax liability is reduced to the minimum by taking advantage of the loopholes of tax law. 

PAN is a code that Acts as an identification for Indian nationals, especially those who pay income tax It is a unique, 10-character alpha-numeric identifier, issued to all judicial entities identifiable under the Indian Income Tax Act 1961. It is issued by the Indian Income Tax Department under the supervision of the Central Board for Direct Taxes (CBDT) and it also serves as an important proof of identification The PAN is mandatory for a majority of financial transactions such as opening a bank account, receiving taxable salary or professional fees, sale or purchase of assets above specified limits, etc. especially high-value transactions The PAN is unique to each individual and is valid for the lifetime of the holder, throughout India An important point to note would be that once issued, the PAN is not affected by a change of address. (9102)