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DIRECT TAXES CODE 2009 : AT A GALANCE

DIRECT TAXES CODE 2009 : AT A GALANCECA - CA. Naresh Jakhotia

- Tax law in simple and easy to understand language.
- The new Income Taxes Code to be applicable from 1st April, 2011.
- Personal Income tax rates slashed substantially. o Upto 10 lacs (less existing basic exemption limit) : 10% o Next 15 lacs : 20% o Over 25 lacs : 30%
- All Companies to pay tax @ 25%.
- MAT @ 2% of gross assets. Even loss making companies to pay MAT.
- No provision for MAT credit.
- Dividend distribution tax to continue @ 15% of divided.
- Foreign companies also to pay 15% of branch profit tax.
- Firms to continue to pay tax @ 30%.
- No cess or surcharge in any case.
- Agricultural income continues to be included in taxable income only for rate purposes.
- Wealth tax exemption limit raised to 50 crores. To include financial assets like shares.
- Limit of savings increased fr…

TAX TALK- 31.08.2009-THE HITAVADA

TAX TALK
BY CA. NARESH JAKHOTIA
(Chartered Accountant)


“DEDUCTION TOWARDS REIMBURSEMENT OF MEDICAL EXPENDTIURE …..”

Query 1]
Sir, We are a private limited company. We are paying salary to employees in the break up of Basic, HRA, Conveyance & Medical allowance.I want to ask is any deduction available in respect of medical allowances (paid as salary)or entire amount of medical allowance is taxable? What about the taxability of other items like HRA, Conveyance, and Basic? [dineshsinghgaharwar@rediffmail.com]
Opinion:
1. Medical Allowance: a) Only reimbursement of medical expenses up to Rs. 15,000/- is exempt from income tax. Amount received over and above Rs. 15,000/- is taxable as “Income From Salary”. b) Fixed Medical allowance is taxable in the hand of employee. It is not plainly exempt from income tax even if it is actually expended for medical treatment by the employee.
2. House Rent Allowance (HRA): In respect of HRA, the least of the following is exempt from tax u/s 10(13A):…

DO THE THANKLESS JOB & GET PROSECUTION AS A REWARD- T.D.S.

DO THE THANKLESS JOB & GET PROSECUTION AS A REWARD

Call it a T.D.S or a TEDIOUS. It’s tantamount to one and the same thing. Perhaps, no one can breathe comfortably (Exclude I.T. department) if one goes through the recent ruling of the Honorable Apex court. What a thankless job an assessee is doing for the Government? What is the reward an assessee is getting when it is working as an agent of the Government? All the more, what is the consequence that follows if a minor failure is committed by the assessee? A judgment with a far reaching effect was very recently delivered by the Honorable Supreme court in Madhumilan Syntex limited case wherein it is held that prosecution can be done for delay in depositing the T.D.S

BRIEF HISTORY OF THE CASE:
The amount involved in this case was a little more than Rs 1 lacs & relates to the year 1989. The company had deposited the T.D.S along with interest into the Government treasury after a delay of two-day, yet the AO (Assessing Officer) issue…

TAX TALK- 10.08.2009-THE HITAVADA

TAX TALK- 10.08.2009-THE HITAVADA
TAX TALKBY CA. NARESH JAKHOTIA
(Chartered Accountant)


“NON RECEIPT OF T.D.S CERTIFICATE …………..”


Query 1]Sir, we are working with a PSU. Kindly clarify whether group insurance compensation received from insurance company by staff is exempt from income tax or not?
[N. Subramanian]
Opinion:
1. Insurance compensation received under a group insurance scheme is not taxable in the hands of employee since it is a capital receipt.2. Further, if a person receives ex-gratia payment from the Central Government/ State Government/ Local Authorities/ or a Public Sector unit, consequent upon the injury to the person while on duty, such ex- gratia payment will not be liable to income tax. [Circular No. 776 dated 08.06.1999]

Query 2]
Sir, Kindly let me know whether deductee can claim credit when deductor did not issue or refused to issue Certificate for the Tax Deducted at Source. Is it not binding on the part of deductor to issue TDS Certificate? What steps can deductee take i…