Income tax basic concepts notes pdf

It is very important to know the various other concepts. From july 1st, 2017 all such indirect taxes are submerged in one tax law which was named as the goods and services tax act, 2017. Moreover, the income is defined in section 224 of the act. Jul 01, 2019 download basic accounting principles text book pdf. In general terms, the meaning of a person can be interpreted in a short term. It is an art of recording, classifying and summarizing in significant manner and in terms of money, transactions and events which are of financial character and interpreting the results thereof. Ca final indirect direct tax summary book pdf may 2020. As the name suggests,salary received by employee is taxable under income from salariesexamplesuppose a person gets flat salary of rs 20000 p. Income tax reform proposals advisory panel report in 2005 simplified income tax plan sitp. In addition to replacing the ordinary corporate income tax with a cashflow tax, it also proposed to introduce border tax. In india income tax is governed by the income tax act 1961. Therefore, the confiscation of currency notes employed in smuggling activity is a loss which arises directly from the carrying on of the business. Tax is a compulsory contribution to state revenue, levied by the government on workers income and business profits, or added to the cost of some goods, services, and transactions. Download basic accounting principles text book pdf.

Generally, this is a percentage of the money a person receive or give. Cma intermediate notes cma inter notes is available for download here on this page and also on our webstore. To know about the income tax act to know about the history of income tax act to know about various basic concepts used in income tax act. Download income tax laws text book pdf for, mba and llb. The benefit received is not directly associated with the return of tax 6. By law, taxpayers must file an income tax return annually to determine their tax obligations. Jul 14, 2017 ay 201819 income tax basic concepts by ca raj k agrawal duration. The current income tax system in the united states is a progressive tax. Incometax and corporate tax planning innovative ugc net. The assessment year comprises of a period of twelve months corresponding to a financial year. The liability of an indirect taxes on the other hand, can be shifted to another person. In this sense, citizenbeneficiaries may more equitably share the burden of paying for state or local government than is the case of the financing schemes already noted.

The main question is that how unlimited needs and wants can be satisfied by those limited resources. Basic accounting basic concept of accounting accounting. Apr 01, 2020 cma intermediate notes cma inter notes is available for download here on this page and also on our webstore. The key point to be made is that federal income taxation is based on a system. The income tax and wealth tax act lesson 1 introductionand important definitions introduction 3 basic concepts of income tax act 3 income 4 assessee 11 person section 231 12 assessment year section 29. The largest component, in terms of revenue generated, is the individual income tax. These taxation notes had been prepared for students who are doing advanced taxation modules for professional bodies as well as for honours and master degrees levels.

Education cess and secondary and higher education cess are levied on the aggregate of income tax and surcharge. Introduction and basic concepts of income tax act 1961. Basic concepts of income tax act 3 income 4 assessee 11. As the name suggests, salary received by employee is taxable under income from salaries. When i was in job there were many concepts in income tax which though i have read and. It is the aggregate taxable income under the different heads of income such as income from salary, income from house property, income from profits or gains of business, capital gains and income from other sources.

The basic concept, rates of income tax, income tax law, heads of income are the contents of the topic. Tax is a payment to the government by the public 3. The study material contains all relevant amendments made by finance act. Every year finance act bring amendment to this act. Income tax is generally due on the net income realised by the taxpayer over an income period.

I do not wanted my students to face the similar situation which i was facing. Income, which do not form part of total income sec. However, as this report notes, models of ubi that are universal and sufficient are not affordable, and models that are affordable are not uni. Take your pretax income and deduct your standard deduction and personal exemption.

Download income tax laws text book pdf for, mba and. Taxation is one of the core competence areas of ca. This lecture gives introduction of the income tax law. At the end of the year, every person that earned income must file a tax return to determine whether the government collected enough taxes through withholding or whether the government owes a person a refund for paying too much tax. Chapter 2 income tax concepts 47 the federal income tax is based on a system of rules and regulations that determine the treatment of various items of income and expense.

Income tax is generally due on the net income realised by. Taxes are either direct, where the money goes directly from a persons pocket to the govts pocket, or indirect, where the money goes from a persons pocket to someone elses pocket and then to the govts. Measurement and recognition the main objective of this concept is to identify various attributes of income from taxation standpoint. Download fast track quick revision of income tax for. To know about various basic concepts used in income tax act. The rationale is to provide students with reliable content that helps them to grasp the core concepts of taxation. In this ca intermediate ca ipcc income tax notes pdf curriculum only working knowledge of core and allied subjects to accountancy profession is covered, while at the final new course, advanced application knowledge of core and allied subjects to accountancy profession has been intended to be inculcated. May 29, 2018 as the name suggests,salary received by employee is taxable under income from salariesexamplesuppose a person gets flat salary of rs 20000 p. Any money the government takes from a person legally for doing any economic activity is tax. In states that have sales taxes applicable to all purchases, every citizen or resident who buys anything pays some sales tax. Income from house property profits and gains of business or. Income tax does not make any distinction in computing income, whether it receive in lump sum or instalment. Ie total income computed in accordance with the provision of the act before making any deductions under sec 80 c to 80 u. Introduction to taxation our purposes, the sections on tax structure, types of tax, tax.

Introduction and basic concept of income tax law times journal. Download income tax laws text book pdf for 3rd year students. Two major problems concerning the determination of the amount of income, namely. Direct tax laws income tax and wealth tax and indirect tax laws service tax, value added tax and central sales tax covered in the syllabus. Income tax is levied on the total income of the previous year of every person.

It seems my knowledge in income tax was not enough. Introduction to taxation government plays an important role in most modern economies. Residential status and incidence of tax excluding section 9a 2. Income tax act is used for determination of taxable income, tax liability and also provides procedure for assessment, appeal, penalties and prosecutions.

Note salary is taxable under this head only if there is proper employer employee relationship. Concept, clarity and command over international taxation duration. Com income tax study material income tax tax deduction. Keep social distance and utilize your time by joining ca cs cma online. Income taxes are a source of revenue for governments. Salary is taxable under this head only if there isproper employer employee relationshipi. I was feeling frustrated inspite of the fact that i passed the exam. The notes have been prepared on the knowledge that advanced. This document is highly rated by b com students and has been viewed 4875 times.

Study 31 chapter 1 basic concepts unit1 income tax law. As such, it shares the characteristics of any type of system. Income tax oincome tax is a tax on yearly taxable income of a person levied by the central government at prescribed rates. So, the person liable to pay the tax can collect the tax from someone else and then pay it to the government.

Taxation notes these taxation notes had been prepared for students who are doing advanced taxation modules for professional bodies as well as for honours and master degrees levels. Nov 27, 2017 income tax basic concepts short notes a y 2018 19. Keep social distance and utilize your time by joining ca cs cma online classes at 30% disc coupon. Taxable income means income calculated under the provisions of the income tax act. Accounting is the system a company uses to measure its financial performance by noting and classifying all the transactions like sales, purchases, assets, and liabilities in a manner that adheres to certain accepted standard formats. This book deals with the law of taxation or income tax laws. Hindi income taxbasic concepts by ca raj k agrawal. Federal income tax reinstated in 1894, but challenged in court.

The federal income tax system the federal income tax system has several components. Basic concept of income tax act income tax is levied on the total income of the previous year of every person. Introduction and basic concept of income tax law times. When i was in job there were many concepts in income tax which though i have read and studied but i was unable to apply it in practical situations. In 1895, supreme court ruled income tax unconstitutional. Introduction to some basic concepts basic income tax. Ay 201819 income tax basic concepts by ca raj k agrawal duration. Income tax refers to the tax you pay directly to the government depending on your income or profit for companieslocal authorities. In the income tax act, the income tax year is described as assessment year, that is the year in which the income of the previous year which ended before the commencement of assessment year, is to be assessed. Income tax notes covers basic concepts, income from salaries, income from house property and other three heads of income, basis of charge, clubbing. Basic concepts one of the most important, but misunderstood concepts in tax planning is the mechanics of the united states progressive tax system. There are a variety of forms of income and consumption taxes. First federal income tax levied in 1861 to fund civil war.

Assessment year sec 29 it means the period of twelve months commencing from 1st april to 31st of march the next year. Exam preparation ca intermediate ca ipcc income tax notes. First, income tax is computed on total income at prescribed rates and then surcharge is worked out on the amount of income tax so computed to arrive at the total tax liability. The term earnings is already known by the public, even by those who do not earn even. Tax is a fee charged by a government on a product, income or activity.