Mr. AB is an individual and employed in a company. He has submitted the following information...
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Mr. AB is an individual and employed in a company. He has submitted the following information for the tax year 2016. Compute his taxable income and tax liability for the tax year 2016. (Part A) Rs. 700,000 Basic salary per annum Bonus 100,000 COLA (Cost of Living Allowance) 80,000 Rent free un-furnished accommodation with annual rental value 110,000 Dearness allowance 100,000 Utilities allowance 80,000 Leave encashment 48,000 LFA provided every year 118,000 Hotel bills paid by the company relating to a pleasure trip 222,000 Monthly contribution by the employer to the provident fund which is equal to deduction from the employee @ 9% of basic salary. Interest free loan Rs.1,300,000 received from the company 5,250 Company maintained car provided for both official and private purposes, the FMV of the car is Rs.800,000. (Part B) Income from Property: AB rented his house @ Rs. 15,000 per month for the year ended 30-06-2016. Rs. Rent received at the beginning of the financial year 180,000 Mr. AB claimed the following expenditure: Repair and maintenance charges 30,000 Property related taxes 6,000 Collection charges 22,000 Legal charges (including Rs. 10,000 due but not yet paid) 35,000 (Part C) Other Information: Rs. Dividend received (after tax) 8,000 Zakat deducted from dividend 500 60,000 Gain on sale of listed co's shares (shares acquired before 1.7.2012) Capital gain on private limited company (holding period 13 months) 50,000 Income from winning of a lottery 25,000 Rs. (Part D) Deduction at Source: From salary 3,000 From dividend 1,500 EXTRACT OF TAX RATES FOR SALARIED INDIVIDUAL Taxable Income Rate of Tax 1. Upto Rs. 600,000 0% 2. Rs. 600,001- Rs. 1,200,000 5% of the amount exceeding Rs.600,000 3. Rs. 1,200,001 ----- Rs. 1,800,000 Rs. 30,000+ 10% of the amount exceeding Rs. 1,200,000 4. Rs. 1,800,001 Rs. 2,500,000 Rs. 90,000+ 15% of the amount exceeding Rs. 1,800,000 5. Rs. 195.000+ 17.5% of the amount exceeding Rs. 2,500,000 Rs.2,500,001 -----Rs. 3,500,000 6. Rs.3,500,001 ----- Rs. 5,000,000 Page 4 of 6 Rs. 370,000 + 20% of the amount exceeding Rs. 3,500,000. 7. Rs.5,000,001- ----- Rs. 8,000,000 Rs. 670,000+22.5% of the amount exceeding Rs. 5,000,000. 8. Rs.8,000,001 - Rs. 12,000,000 Rs. 1,345,000+ 25% of the amount exceeding Rs. 8,000,000. 9. Rs.12,000,001----- Rs. 30,000,000 Rs. 2,345,000+27.5% of the amount exceeding Rs. 12,000,000. 10. Rs.30,000,001- - Rs. 50,000,000 Rs. 7,295,000+30% of the amount exceeding Rs. 30,000,000. 11. Rs.50,000,001 - Rs. 75,000,000 Rs. 13,295,000+32.5% of the amount exceeding Rs. 50,000,000. 12. OVER Rs.75,000,000 Rs. 21,420,000+ 35% of the amount exceeding Rs. 75,000,000. Sr. No. Mr. AB is an individual and employed in a company. He has submitted the following information for the tax year 2016. Compute his taxable income and tax liability for the tax year 2016. (Part A) Rs. 700,000 Basic salary per annum Bonus 100,000 COLA (Cost of Living Allowance) 80,000 Rent free un-furnished accommodation with annual rental value 110,000 Dearness allowance 100,000 Utilities allowance 80,000 Leave encashment 48,000 LFA provided every year 118,000 Hotel bills paid by the company relating to a pleasure trip 222,000 Monthly contribution by the employer to the provident fund which is equal to deduction from the employee @ 9% of basic salary. Interest free loan Rs.1,300,000 received from the company 5,250 Company maintained car provided for both official and private purposes, the FMV of the car is Rs.800,000. (Part B) Income from Property: AB rented his house @ Rs. 15,000 per month for the year ended 30-06-2016. Rs. Rent received at the beginning of the financial year 180,000 Mr. AB claimed the following expenditure: Repair and maintenance charges 30,000 Property related taxes 6,000 Collection charges 22,000 Legal charges (including Rs. 10,000 due but not yet paid) 35,000 (Part C) Other Information: Rs. Dividend received (after tax) 8,000 Zakat deducted from dividend 500 60,000 Gain on sale of listed co's shares (shares acquired before 1.7.2012) Capital gain on private limited company (holding period 13 months) 50,000 Income from winning of a lottery 25,000 Rs. (Part D) Deduction at Source: From salary 3,000 From dividend 1,500 EXTRACT OF TAX RATES FOR SALARIED INDIVIDUAL Taxable Income Rate of Tax 1. Upto Rs. 600,000 0% 2. Rs. 600,001- Rs. 1,200,000 5% of the amount exceeding Rs.600,000 3. Rs. 1,200,001 ----- Rs. 1,800,000 Rs. 30,000+ 10% of the amount exceeding Rs. 1,200,000 4. Rs. 1,800,001 Rs. 2,500,000 Rs. 90,000+ 15% of the amount exceeding Rs. 1,800,000 5. Rs. 195.000+ 17.5% of the amount exceeding Rs. 2,500,000 Rs.2,500,001 -----Rs. 3,500,000 6. Rs.3,500,001 ----- Rs. 5,000,000 Page 4 of 6 Rs. 370,000 + 20% of the amount exceeding Rs. 3,500,000. 7. Rs.5,000,001- ----- Rs. 8,000,000 Rs. 670,000+22.5% of the amount exceeding Rs. 5,000,000. 8. Rs.8,000,001 - Rs. 12,000,000 Rs. 1,345,000+ 25% of the amount exceeding Rs. 8,000,000. 9. Rs.12,000,001----- Rs. 30,000,000 Rs. 2,345,000+27.5% of the amount exceeding Rs. 12,000,000. 10. Rs.30,000,001- - Rs. 50,000,000 Rs. 7,295,000+30% of the amount exceeding Rs. 30,000,000. 11. Rs.50,000,001 - Rs. 75,000,000 Rs. 13,295,000+32.5% of the amount exceeding Rs. 50,000,000. 12. OVER Rs.75,000,000 Rs. 21,420,000+ 35% of the amount exceeding Rs. 75,000,000. Sr. No.
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Part A Taxable Income Basic salary 700000 Bonus 100000 COLA 80000 Rent free unfurnished accommodation 110000 Dearness allowance 0 Utilities allowance 80000 Leave encashment 48000 LFA provided every ye... View the full answer
Related Book For
South western Federal Taxation 2017 Essentials of Taxation Individuals and Business Entities
ISBN: 9780357109144
20th edition
Authors: William A. Raabe, David M. Maloney, James C. Young, Annette Nellen
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