Computation of income in case of trust audit

15% of rs.373678 is to be calculated

Thanks Jyotsana for your reply...

But if you go through this attempt Direct Tax May 2015 paper,Q3 I was confused with the suggested answer of ICAI... They are setting apart 15% (recepits less of expenses). I also agree with you Jyotsana, but ICAI is considering as per relevant section " 15% of Income" and they take in Income as (receipts less expenses)...

Regards,

Sumit Agarwal

yup..in practice manual they take it as receipts - exp. incurred (revenue in nature).

They are actually treating only capital exp as application. I think its wrong.

Yeah Jyotsna,

U understood me correctly...Now its the apex body of CA's and examiners take it that way... Is there any clarification or circular supporting your answer... I too have been doing the same but after the solution of ICAI I am bit confused about it...

Regards,

Sumit Agarwal

M not aware of any circular or notification. Basis of my opinion is that, Meaning of application is not defined so we can take it inclusive manner i.e. including revenue as well as cap. Exp..if any distinction is meant to be considered then tht should hv been written as this had been done in other section of act And yeah if u refer to definition of income then see income does not only mean net profit or loss...rather income includes profit etc. actually i did it practically this way.however we will get marks for the solution as per our institute's material

In case of Trust,  is it compulsory to claim 15% exemption as a set for future use , when trust applied its income more than 85%. For Example:- Gross Receipt is Rs.1500 and application of Income is 9927/- and accumulated income of A.Y.2013-14 is Rs. 163672/- (which was filed in form 10 to A.O.).

Now tell me one thing should i claim 15% exemption as a set for future use ?????