India Income Tax Made Simple

Archived; click post to view.
Excerpt: Whether additional deprecaition is compulsory to charge? Baljeet Singh, Nagpur Depreciation is now not optional on account of insertion of Explanation 5 below clause (ii ) of subsection 1 of section 32. This explanation reads as under. Explanation 5.For the removal of doubts, it is hereby declared that the provisions of this sub-section shall apply whether or not the assessee has claimed the deduction in respect of depreciation in computing his total income; This explanation 5 is below the sub-clause (ia). However , additional depreciation is provided under clause (iia)…

Archived; click post to view.
Excerpt: We are into imports of wood and there’s a duty of 5 % (basic) and 4% (SAD) on our imports. WEF 14/09/2007 the government has decided to issue refund of the SAD (4%) component of the duty. To file a claim for duty refund we have to show in our accounts that this is a refund expected. This will be treated as income. Question is : Do we have to pay income tax on this in the first installment or is income tax only liable after we receive the refund. The refund might or might not come through. So…

Archived; click post to view.
Excerpt: We have SSI unit in Maharashtra manufacturing cotton bales. We have received Subsidy through District industrial centre from Central & state govt. Under Special capital incentive scheme P.S.I.2001.I want to know how I should account for the amount of incentive received. Praful Agrawal,khamgaonThe taxation of capital subsidy depends upon the nature and circumstances under which the subsidy is given by governments from public accounts money. This is one issue where no fixed rule is possible because the issue has to be settled first is -whether the subsidy is capital receipt or revenue receipt. The answer to this question entirely depends…