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Income tax as per annual income

04 April 2021

Sir,

in a proprietor firm net profit is Rs.6 Lac 21 thousand in 80C we have deposit 150000 in PPF account so can we eligible for rebate 12500 or need to pay any tax

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8 Replies

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 04 April 2021

No your tax liability will be Nil

1 Like

Sonu Kumar (Account Manager) (665 Points)
Replied 04 April 2021

Under 87A if Your Net Taxable income is Less than 5 Lakh then You Will Get Rebate 12500

1 Like

Ashok Reddy Edara (41 Points)
Replied 04 April 2021

Hi Naveen ,

Your taxable income is 4.5L i.e (6L - 1.5L) ,which is less than 5L so you are eligible for rebate under sec 87A of Income Tax Act.

For your understanding as per Sec 87 A ,we have to consider only net taxable income only i.e after claiming the eligible deductions only you have check the limit of 5L.

I hope now it is more clear for you that you are eligible for the rebate of 12,500.

1 Like

Naveen Kumar (629 Points)
Replied 04 April 2021

Thank you Ashok Sir,

1 Like

sabyasachi mukherjee (25988 Points)
Replied 05 April 2021

Profit of a concern is not calculated in that manner.
you are wrong.

Ashok Reddy Edara (41 Points)
Replied 05 April 2021

Its a sole prioprietor firm not a partner ship firm ,Mr.Sabhyasachi Mukherjee . I hope I explained it in correct manner ,if I am wrong then please correct me .

sabyasachi mukherjee (25988 Points)
Replied 05 April 2021

The query string has not mentioned whether it's a one man company. The way you have explained it's being done for an individual assesse. If you want to know still I may explain you .Pls send your mailiD. It's calculated from backside. For income tax act it's calculated in a different way. 1. It's difficult to explain now. Thank u.