Example # 1
Family Age Amount Mode
Assessee 59 8,000 Chq
Spouse 57 9,000 Chq
Child # 1 18 4,000 Chq
Child # 2 16 6,000 Chq
Ans. 25,000
Example # 2
Family Age Amount Mode
Assessee 63 9,000 Chq
Spouse 59 9,000 Chq
Child # 1 18 4,000 Chq
Child # 2 16 6,000 Chq
Child # 3 12 7,500 Chq
Parent # 1 89 28,000 Chq
Parent # 2 91 28,000 Cash
Ans. = 28,000 + 9,000 + 25,000
= 62,000
Example # 3
Family Age Amount Mode Health Check up
Assessee 59 8,000 Chq
Spouse 63 9,000 Chq 3,000
Child # 1 18 6,000 Chq
Child # 2 16 2,000 Chq
Child # 3 12 7,500 Cash
Parent # 1 89 18,000 Chq
Parent # 2 91 28,000 Chq 3,500
Ans. = 46,000 + 3,500 + 9,000 + 1,500 + 16,000
= 76,000
Example # 4
Family Age Amount Mode Health Check up
Assessee 60 9,000 Chq 1,000
Spouse 63 9,000 Chq 1,000
Child # 1 18 6,000 Chq
Child # 2 16 6,000 Chq 2,000
Child # 3 12 6,000 Chq
Parent # 1 89 18,000 Chq 1,500
Parent # 2 91 28,000 Chq 1,500
0
Ans. 49000 + 20000 + 18000 + 0
= 87000
Section 24 Section 80EEA Section 80C
What qualifies Interest Interest Principal
Limit LOP – no limit 150000 150000
SOP – 30000/ 200000
Loan from Any Financial institution. Financial institution
Pre-construction 1/5 – 5 No deduction No deduci0on.
80TTA/ 80TTB
#1 #2 #3 #4 #5 #6
Age 54 56 65 78 78 44
Account SB SB SB FD SB + FD FD
Interest / 8,000 18,000 45,000 56,000 35,000+ 11,000
IFOS 40,000
Section 80TTA 80TTA 80TTB 80TTB 80TTB 80TTA
Deduction 8,000 10,000 45,000 50,000 50,000 -
Net - 8,000 - 6,000 25,000 11,000
Post-office Saving Bank account – 10(15) – 3,500 plus 80TTA/ 80TTB
Unit 1 Unit 2
Turnover 700 500
Eligible 200 400
Profit 60 50
Unit 2 is located in SEZ.
Ans.
Profit of Unit 1 60.00
Profit of Unit 2 50.00
G.T.I. 110.00
Less: 10AA [ 50 x 400/ 500] x 100%] 40.00
Total Income 70.00
44AD
When How Actual Profit
(a) Resident 8% of T.O. or more
(b) Individual / HUF/ Firm
(Except LLP)
6% of T.O. or more 80.00 80.00
(c) Business (except ABC)
(d) Chapter VIA-C or Benefits/ Impact: 6.40 6.40
10AA. (i) No allowance/ no 9.00 3.00
(e) Turnover <= 200 lacs disallowance.
(ii) No audit 9.00 Optout
(iii) Advance tax – 1 3.00
installment.
T.I. = 2 lacs T.I. = 4 lacs
No audit Audit
44ADA
When How Actual Profit
(a) Resident 50% of T.O. or more
(b) Specified Profession –
44AA
Benefits/ Impact: 40.00 40.00
(c) T.O <= 50 lacs.
(i) No allowance/ no 20.00 20.00
disallowance. 32.00 12.00
(ii) No audit
(iii) Advance tax – 1 32.00 Optout
installment. 12.00
T.I. = 2 lacs T.I. = 4 lacs
No audit Audit
44AE
When How Actual Profit
(a) Business – Hiring/ 7500 p.m/p.t. or more
Leasing / Plying of goods
carriages
>12 Tonnes – 1000 5 lakhs 5 lakhs
(b) OWNERSHIP <= 10
p.t./p.m or more 8 lakhs 3 lakhs
good carriages
Benefits/ Impact: 8 lakhs optout
(i) No allowance/ no audit
disallowance.
(ii) No audit
(iii) Advance tax – 1
installment.
13 = 130000
Eg # 1
6 trucks (<12 Tonne)
1 truck (18 tonne)
Ans. 7,56,000
6 x 7500 x 12
1 x 18000 x 12
eg # 2
01.04.2020 (opening) 5 trucks (< 12 tonnes)
1 truck (16 tonnes)
Purchase 10 tonnes (19.12.2020)
Ans. 6,72,000
5 x 12 x 7500
1 x 12 x 16000
1 x 4 x 7500
Eg # 3
01.04.2020 (opening) 4 trucks (< 12 tonnes)
2 trucks (20 tonnes each)
1 Sell (20 tonnes ) 08.11.2020
Ans. 7,60,000
4 x 12 x 7500
1 x 12 x 20000
1 x 8 x 20000
Eg # 4
01.04.2020 opening 6 trucks (< tonnes)
1 purchase 25.05.2020
Ready to use 10.06.2020
Ans. 6,22,500
6 x 12 x 7500
1 x 11 x 7500
Professional
0 50
44ADA audit
>=50% <50%
44ADA Optout
No audit
T.I <BEL T.I.> B.E.L.
No audit Audit
Examples on Section 44ADA
Eg #1 Eg # 2 Eg # 3
Turnover 20 lakhs 30 lakhs 40 lakhs
Profit/ Total Income 12 lakhs 5 lakhs 2 lakhs
44ADA applicable/ Yes. Profit Opt-out. Opt-out.
Profit 12 lakhs. Profit 5 lakhs Profit 2 lakhs
Books/ Audit required No. Yes. No.
44AD – Business
95% + 95%
0 100 200 500
Audit
Profit >=8%
44AD Profit <8%
Optout
T.I.<BEL T.I>BEL
No audit Audit Profit >=8% Profit <8%
44AD optout – Audit
Examples on Section 44AD
Eg #1 Eg # 2 Eg # 3 Eg # 4 Eg # 5 Eg # 6
Turnover 70 lakhs 80 lakhs 90 lakhs 150 lakhs 160 lakhs 170 lakhs
Profit/ Total 6 lakhs 5 lakhs 2 lakhs 13 lakhs 6 lakhs 2 lakhs
Income
44AD Yes, Opt-out. Opt-out. Yes. Profit Opt-out. Opt-out.
applicable/ profit 6 Profit 5 Profit 2 13 lakhs. Profit 6 Profit 2
Profit lakhs lakhs lakhs lakhs lakhs
Books/ Audit No. Yes. No. No. Yes. Yes.
required
1. Assessment of Individual.
2. Assessment of Firm: -
Firm / LLP
(a) How to compute the Total Income of Firm?
(ii)PGBP
Less: Salary/ Interest paid to partners
40(b), 184, 185
185
184? Yes 184? No
40(b)
184?
1. Written Partnership deed
2. Deed shall mention – PSR
3. Certified copy of Deed – Filed – ROI.
4. No non-compliance – Best judgment assessment -144
5. Interest/ salary – max. As mentioned in deed
40(b)?
(b) How to compute the Tax of Firm
30% , 12%, 4%
(c) How to compute the Total Income of Partners?
Allow - Partner taxable
Disallow - Partner not-taxable.
Profit - 10(2A) – x
Salary -
Interest -
(d) How to compute tax of partners
rates of tax
#1 #2 #3 #4 #5 #6
Book Profit (2 lacs) 10,000 1,60,000 2,00,000 4,00,000 10 lacs
Remuneration 1.50 1.50 1.50 1.80 3.30 6,90,000
u/s. 40(b) lacs
2.7 + 4.20
#2
A B C
Individual
Income
Profit (10) - - -
Salary 16.80 8.40 -
Interest 2.40 4.80 5.00
Total
25.20 x 10
30
2.40 – p/r 2.60 disallow
#1
A B C
Individual
Income
Profit (10) - - -
Salary 4.725 7.088 7.088
Interest 5.00 15.00 10.00
Total
18.90 x 10
40