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To Calculate Taxtation

Mr. B had a total income of ₹1,32,00,000 from his business, gifts, lottery winnings, and life insurance. After deducting expenses totaling ₹20,63,000, his taxable income was ₹1,11,37,000. Using the applicable tax slabs for an individual over 60 years old, Mr. B's tax liability was calculated to be ₹4,51,100.

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26 views

To Calculate Taxtation

Mr. B had a total income of ₹1,32,00,000 from his business, gifts, lottery winnings, and life insurance. After deducting expenses totaling ₹20,63,000, his taxable income was ₹1,11,37,000. Using the applicable tax slabs for an individual over 60 years old, Mr. B's tax liability was calculated to be ₹4,51,100.

Uploaded by

mannu10091
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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To calculate Mr.

B's taxable income and tax liability, let's break down his income and expenses:

1. Business income: ₹75,00,000

2. Gift from ex-wife: ₹6,00,000

3. Lottery winnings: ₹19,00,000

4. Matured life insurance policy: ₹32,00,000

Total Income = ₹75,00,000 + ₹6,00,000 + ₹19,00,000 + ₹32,00,000 = ₹1,32,00,000

Now, let's deduct the expenses and investments:

1. Family trip expenses: ₹15,00,000

2. Gift to wife: ₹4,50,000

3. Life insurance premium: ₹50,000

4. Tuition fee: ₹50,000

5. PPF investment: ₹80,000

6. Health insurance premium: ₹27,000

7. Medical test: ₹6,000

Total deductions = ₹15,00,000 + ₹4,50,000 + ₹50,000 + ₹50,000 + ₹80,000 + ₹27,000 + ₹6,000 =


₹20,63,000

Taxable Income = Total Income - Total deductions = ₹1,32,00,000 - ₹20,63,000 = ₹1,11,37,000

Now, let's calculate the tax liability using the income tax slabs applicable for an individual aged 60
years or above:

- Up to ₹3,00,000: No tax

- ₹3,00,001 to ₹5,00,000: 5% of (Taxable income - ₹3,00,000)

- ₹5,00,001 to ₹10,00,000: 20% of (Taxable income - ₹5,00,000)

- Above ₹10,00,000: 30% of (Taxable income - ₹10,00,000)


Since Mr. B's taxable income is ₹1,11,37,000, let's compute his tax:

- Tax on ₹3,00,000: No tax

- Tax on next ₹2,00,000 (₹3,00,001 to ₹5,00,000): 5% of ₹2,00,000 = ₹10,000

- Tax on next ₹5,00,000 (₹5,00,001 to ₹10,00,000): 20% of ₹5,00,000 = ₹1,00,000

- Tax on remaining amount (₹11,37,000): 30% of ₹11,37,000 = ₹3,41,100

Total Tax Liability = ₹10,000 + ₹1,00,000 + ₹3,41,100 = ₹4,51,100

So, Mr. B's taxable income is ₹1,11,37,000 and his tax liability is ₹4,51,100.

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