India Tax FAQs
Overall Rating:  [0/5]Total Votes [ ] |
|
Gift tax in India Gift tax in India is regulated by the Gift Tax Act which was constituted on April 1, 1958. It came into effect in all parts of the country except Jammu and Kashmir. As per the Gift Act 1958, all gifts in excess of ` 25,000, in the form of cash, draft, check or others, received from one who doesn't have blood relations with the recipient, were taxable.
What do we mean by Income Tax?
The Government of India imposes a tax on an individual or an organization on their yearly income in the country as mentioned in the Income Tax Act passed by the Indian Parliament.
Who is responsible for this activity?
The Department of Income Tax functioning under the Finance Ministry's Department of Revenue is solely responsible for monitoring the levying and the collection of this tax. This department is a part of the Indian Government.
Is this tax applicable just over income earned within this country?
It is not necessary that the income has to be earned within the physical boundaries of the nation. Income earned from global resources by an Indian citizen is even considered to be a taxable income.
What is meant by yearly income?
Yearly income refers to the income earned by an individual in a financial year, i.e. in between the period from 1st April of one calendar year to 31st March of another. This period is mentioned as "Previous Year" in the Income Tax Act of India.
Is every resident of India eligible for income tax payment?
Any person or group or company, who has earnings in the previous year need to pay this tax over their earned income. Popularly called "Status", the I. T. Act has categorized the earners in the following 7 categories:
An individual is considered to be this country's resident after he or she completes a continuous stay of 182 days in a given year. Residential status of a person is not dependent on his or her citizenship in the nation.
Do non-residents of India pay income tax in the country? Yes, all individuals earning in India are covered within the Indian I. T. Act.
What is meant by an Assessment Year?
Assessment Year is the following financial year, when an individual is supposed to file tax returns for his or her earned income of the previous year.
What is Corporate Tax?
According to the Income Tax Act of India, the income tax paid by a company is known as Corporate Tax.
How to differentiate between a residential and a non-residential company?
Any company, which is incorporated in the Companies Act of India, can be called "resident". However, a foreign company is considered so in case the operational management was done in previous year.
How does the procedure of levying tax differ from residential to non-residential status?
For a person or company, who is a resident of India is levied with tax on their income earned from all over the world. On the contrary, the non-residents are just levied with tax on their income, which has been earned in or from India.
What is income according to the Department of Income Tax?
The term "income" is taken in a broad sense by the I. T. Department. Earnings from the following 5 different sources are considered as income by this department:
Gifts that exceed the amount of INR. 25, 000 are taxable. However, such gifts are even exempted from income tax calculation in case they are received from the following:
The Government of India collects income tax by 3 means that are discussed below:
This is a form prescribed by the I. T. Department to communicate the details of one's income as well as the taxes paid in a particular financial year. The type of such a form varies from the nature and the status of an income to another.
What is PAN?
A PAN of Permanent Account Number is a kind of identity number required to deal with the Department of I. T. Every working individual need to have a card that mentions his or her Permanent Account Number. Apart from its requirement in different kinds of financial transactions, a PAN card forms one of the nationally accepted photo identification means.
Which is a Salary Income?
An income is said to be a "Salary Income" when an employee earns it from his or her employer as salary. This income can either be in cash or kind or facility.
Does such an income solely include houses?
No, it even includes the land bordering the house, if any. This notional income is based on the concept of "Annual Value", which is the value fetched by a property in case it is sold or rented. If not, then the then expected price is considered for tax calculation.
What is a Profession Income?
The independent exploitation of one's own knowledge and talent is called profession. This includes vocation as well. Artists, interior decorators, legal advisors, doctors, writers etc. are some of the well known professionals. Their incomes are referred as "Profession Income".
What is a capital gain?
Even known as "investment income", a capital gain generally means the profit earned from any kind of investment in a capital asset. Properties, which are non-consumable as well as have a permanent value is called capital asset. Every kind of capital asset transfer attracts such a gain.
How is one's return of income verified?
The verification of one's income tax payment is done by the I. T. Department includes by scrutinizing a part of the data available with them. The concerned person, whose data is verified, is given an opportunity to provide evidences in support of his or her claims.
Last Updated on 12/21/2011
The Government of India imposes a tax on an individual or an organization on their yearly income in the country as mentioned in the Income Tax Act passed by the Indian Parliament.
Who is responsible for this activity?
The Department of Income Tax functioning under the Finance Ministry's Department of Revenue is solely responsible for monitoring the levying and the collection of this tax. This department is a part of the Indian Government.
Is this tax applicable just over income earned within this country?
It is not necessary that the income has to be earned within the physical boundaries of the nation. Income earned from global resources by an Indian citizen is even considered to be a taxable income.
What is meant by yearly income?
Yearly income refers to the income earned by an individual in a financial year, i.e. in between the period from 1st April of one calendar year to 31st March of another. This period is mentioned as "Previous Year" in the Income Tax Act of India.
Is every resident of India eligible for income tax payment?
Any person or group or company, who has earnings in the previous year need to pay this tax over their earned income. Popularly called "Status", the I. T. Act has categorized the earners in the following 7 categories:
- A. O. P. (Association of Persons)
- Artificial Juridical Person
- B. O. I. (Body of Individuals)
- Companies
- Firms
- H. U. F. (Hindu Undivided Family)
- Individuals
- Local Authority
An individual is considered to be this country's resident after he or she completes a continuous stay of 182 days in a given year. Residential status of a person is not dependent on his or her citizenship in the nation.
Do non-residents of India pay income tax in the country? Yes, all individuals earning in India are covered within the Indian I. T. Act.
What is meant by an Assessment Year?
Assessment Year is the following financial year, when an individual is supposed to file tax returns for his or her earned income of the previous year.
What is Corporate Tax?
According to the Income Tax Act of India, the income tax paid by a company is known as Corporate Tax.
How to differentiate between a residential and a non-residential company?
Any company, which is incorporated in the Companies Act of India, can be called "resident". However, a foreign company is considered so in case the operational management was done in previous year.
How does the procedure of levying tax differ from residential to non-residential status?
For a person or company, who is a resident of India is levied with tax on their income earned from all over the world. On the contrary, the non-residents are just levied with tax on their income, which has been earned in or from India.
What is income according to the Department of Income Tax?
The term "income" is taken in a broad sense by the I. T. Department. Earnings from the following 5 different sources are considered as income by this department:
- Capital gains
- House property
- Profession or business
- Salary
- Other sources
Gifts that exceed the amount of INR. 25, 000 are taxable. However, such gifts are even exempted from income tax calculation in case they are received from the following:
- Any relative
- By inheritance or as per will
- During marriage
- In case of the payer's death
The Government of India collects income tax by 3 means that are discussed below:
- A voluntary payment made by people in the form of Self-assessment or Advance Tax in different designated banks
- T. C. S. (Taxes Collected at Source) during expenditure
- T. D. S. (Taxes Deducted at Source) from one's receivable payments
This is a form prescribed by the I. T. Department to communicate the details of one's income as well as the taxes paid in a particular financial year. The type of such a form varies from the nature and the status of an income to another.
What is PAN?
A PAN of Permanent Account Number is a kind of identity number required to deal with the Department of I. T. Every working individual need to have a card that mentions his or her Permanent Account Number. Apart from its requirement in different kinds of financial transactions, a PAN card forms one of the nationally accepted photo identification means.
Which is a Salary Income?
An income is said to be a "Salary Income" when an employee earns it from his or her employer as salary. This income can either be in cash or kind or facility.
Does such an income solely include houses?
No, it even includes the land bordering the house, if any. This notional income is based on the concept of "Annual Value", which is the value fetched by a property in case it is sold or rented. If not, then the then expected price is considered for tax calculation.
What is a Profession Income?
The independent exploitation of one's own knowledge and talent is called profession. This includes vocation as well. Artists, interior decorators, legal advisors, doctors, writers etc. are some of the well known professionals. Their incomes are referred as "Profession Income".
What is a capital gain?
Even known as "investment income", a capital gain generally means the profit earned from any kind of investment in a capital asset. Properties, which are non-consumable as well as have a permanent value is called capital asset. Every kind of capital asset transfer attracts such a gain.
How is one's return of income verified?
The verification of one's income tax payment is done by the I. T. Department includes by scrutinizing a part of the data available with them. The concerned person, whose data is verified, is given an opportunity to provide evidences in support of his or her claims.
Last Updated on 12/21/2011
| >> More About India Tax |
India Tax Information
