Computation of income tax taking sec. 80c benefit

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Jignesh Desai (Querist)
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10 October 2013 An Assessee has: -
(i) Interest Income from FD - Rs. 220000
(ii) Income from Brokerage - Rs. 45000
(iii) Short Term Capital Gain - Rs. 90000

Moreover , he has paid LIC Premium of Rs. 90000

How will his Tax be calculated ?

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Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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10 October 2013 If the Short term capital gain is taxable under special rate then your income is as follows

Taxable income at normal rate Rs.2,65,000(2,20,000+45,000)-Rs.90,000 = Rs.1,75,000.

Taxable income at special rate is Rs. 90,000

Basic exemption limit for A.Y 2013-14 for Individual(non-senior citizen) is Rs.2,00,000.

So your taxable income at normal rate is Rs.1,75,000 only means you have Rs.25,000 gap this gap can be adjust with the short term capital and on then balance amount of Rs.65,000 on this amount calculate tax at special rate.

In case short term capital gain is taxable at normal rates then your taxable income is Rs.2,65,000(2,20,000+45,000+90,000-90,000) and pay tax on Rs.65,000 at normal rates.

OM SAI SRI SAI JAI JAI SAI

Nikhil Kaushik

Nikhil Kaushik (Expert)
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10 October 2013 Assuming that the assessee is less than 60 years old, the total income is Rs 3.55 lakhs

Taxable income is Rs 2.65 Lakhs

tax is 10.30% on 65 thousand.

Jignesh Desai

Jignesh Desai (Querist)
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15 October 2013 I forgot to clarify that the Short Term Gain is on Shares , so it is taxable at Special Rate of 15 % . So, then , how will the Income Tax be calculated ?

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 October 2013 then, your taxability shall be as under:

tax @ 15% on Rs 65,000

edu cess @ 3% on tax.

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Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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15 October 2013 I already given such clarification also in my reply.

OM SAI SRI SAI JAI JAI SAI

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