| A) | Income from Ordinary Sources Including Deemed Income | ||
| 1. Income from employment | |||
| 2. Income from house property. | |||
| 3. Income from business. | |||
| 4. Capital gains. | |||
| 5. Income from residuary sources. | |||
| -------==------ | |||
| Current Income from Ordinary Sources. | |||
| Less : Unabsorbed preceeding year loss form the ordinary Sources | |||
| ---------------- | |||
| Gross Total Income from Ordinary Source | +ive income | ||
| Or ‘unabsorbed current loss from ordinary sources’ for (-) | -ive income | ||
| ---------------- | N | ||
| B) | Deduction & Tax Incentives under | ||
| Sec. 66. Deductions for savings | |||
| Sec. 67. Deductions in respect of children education | |||
| Sec 68. Deduction in respect of interest on loan taken for higher education | |||
| Sec 69. Deduction in respect of health insurance premia | |||
| Sec 70. Deduction in respect of medical treatment, etc. | |||
| Sec 71. Deduction in respect of maintenance of disabled dependent | |||
| Sec 72. Deduction in respect of donations to certain funds, non-profit organisations, etc. | |||
| Sec 73. Deduction in respect of political contributions | |||
| Sec 74. Deduction in respect of interest income on bonds | |||
| Sec 75. Deduction in respect of income of Investor Protection Fund | |||
| Sec 76. Deduction in respect of certain income of trade unions | |||
| Sec 77. Deduction in respect of royalty income, etc., of author of certain books | |||
| Sec 78. Deduction in respect of royalty on patents | |||
| Sec 79. Deduction in case of a person with disability | |||
| Sec 80. Deduction in respect of income of co-operative society from banking activities | |||
| Sec 81. Deduction in respect of income of primary cooperative societies | |||
| Sec 82. Expenditure for promoting family planning and preventing HIV-aids | |||
| = Aggregate amount of Deduction | -------------- | ||
| (Deduction Restricted up to Gross Total Income from Ordinary Source) | |||
| C) | Income from Special Sources | ||
| 1 Income of Non-resident from | |||
| (a) On investment income by way of - 1) Interest @ 20 per cent, (ii)dividends on which distribution tax has not been paid. @ 20 per cent (iii) capital gains @ 30 per cent, (iv) any other investment income @ 20 per cent | |||
| (b) On income by way of royalty or fees for technical services @ 20 per cent | |||
| 2 Non-resident sportsman, who is not a citizen of India, On income by way of | |||
| (i) participation in India in any game [other than a game the winnings wherefrom are taxable under sub-item (b) of item 4] or sport | |||
| (ii) advertisement; or | |||
| (iii) contribution of articles relating to any game or sport in newspapers, magazines or journals in India @ 10 pen cent; | |||
| 3 Non-resident sports association or institution: On income by way of guarantee money in relation to any game(other than a game the winnings wherefrom are taxable sub-item (b) of item 4) or sports played in India. @ 10 per cent | |||
| (4) Any assessee, Income by way of winnings from- (i) any lottery or crossword puzzle; (ii) race, including horse race (not being the income from the activity of owning and maintaining race horses); or (iii)card game or any other game or gambling or betting. @ 30 per cent | |||
| --------------- | |||
| Gross Total Income from Special Sources | |||
| Less : ‘unabsorbed preceeding year loss from the special source’ | |||
| =‘Gross Total Income from the special source’ | +ive income | ||
| or Unabsorbed current loss from the special source for (-) | -ive income | ||
| Add Gross Total Income from any other special source | |||
| --------------- | |||
| Total Income from special sources | |||
| =========== | |||
| Total Income =(A-B)+C | NNNNNN | ||
| ======== | |||
Section 284 Definitions
73. “current income from ordinary sources” means the net result of the aggregation under sub-section (3) of section 58
74. “current income from the special source” means the income referred to in subsection (2) of section 59
116.“gross total income” for a financial year means the aggregate of the gross total income from ordinary sources and the gross total income from special sources, for that financial year;
117. “gross total income from ordinary sources” of a financial year means the net result of the aggregation under sub-section (3) or sub-section (4) of section 58, for that financial year.
118. “gross total income from the special source” of a financial year means the net result of the aggregation under sub-section (2) or sub-section (3) of section 59, for that special source for that financial year.
128.“income” includes,-
(a) gross salary referred to in section 21;
(b) gross rent referred to in section 25;
(c) the amount of any accrual or receipt from the businesses referred to in column (2) of Table-1 in sub-section (2) of section 30;
(d) gross earnings from the business referred to in section 31;
(e) full value of the consideration received or accruing as a result of the transfer of any investment asset referred to in section 48;
(f) gross residuary income referred to in section 56;
(g) voluntary contributions received by any person other than an individual or a Hindu undivided family;
(h) any sum deducted at source on payment received, in accordance with the provisions of Chapter XI; and
(i) income of the nature referred to in column (3) of Table in Rule 3 of the First Schedule;
129.“income from business” means the profits of the business as computed under section 30;
130.“income under the head ‘capital gains’ ” means the income as computed under sub-sections (4) or (5) of section 47;
131.“income under the head ‘income from business’ ” means the income in respect of that head, as computed under sub-section (1) of section 58;
132.“income from employment” means the income as computed under sections 20;
133.“income under the head ‘income from employment’ ” means the income in respect of that head, as computed under sub-section (1) of section 58;
134.“income from house property” means the income as computed under section
135.“income under the head ‘income from house property’ ” means the income in respect of that head, as computed under sub-section (1) of section 58;
136.“income from residuary sources” means the income as computed under section
137.“income under the head ‘income from residuary sources’ ” means the income in respect of the head, as computed under sub-section (1) of section 58;
138.“income-tax” in relation to ,-
(a) India, means the income-tax payable under section 2; and
(b) any foreign country, includes any excess profits tax or business profits tax charged on the profits by the Government of any part of that country or a local authority in that country;
137.“income under the head ‘income from residuary sources’ ” means the income in respect of the head, as computed under sub-section (1) of section 58;
275.“tax bases” means-
(a) income or total income, as the case may be, in relation to income-tax;
(b) net wealth in relation to wealth-tax;
(c) dividend distributed in relation to dividend distribution tax; and
(d) the income or total income, net wealth, or dividend distributed referred to in sub-clauses (a) to (c) of any other person in respect of which the assessee is assessable under this Code;
284.“total income from special sources” of a financial year means the net result of the aggregation under sub-section (4) of section 59 for that financial year.
291. “unabsorbed current capital loss” means the amount determined under subsection (5) of section 47.
292.“unabsorbed current loss from ordinary sources” means the amount determined under sub-section (4) of section 58;
293.“unabsorbed current loss from the special source” means the amount determined under sub-section (3) of section 59;
294.“unabsorbed preceeding year capital loss ” means the unabsorbed current capital loss, for the financial year immediately preceeding the relevant financial year;
295.“unabsorbed preceeding year loss from ordinary sources” means the unabsorbed current loss from ordinary sources, for the financial year immediately preceeding the relevant financial year;
296.“unabsorbed preceeding year loss from the special source” means the unabsorbed current loss from the special source, of the financial year immediately preceeding the relevant financial year;
Classification of sources of income
Section 12 For the purposes of computation of total income of any person for any financial year, income from all sources shall be classified under the following :
A. Income from special sources
B. Income from ordinary sources
Computation of income from special sources
Section 13 (1) Every item listed in the Table in rule 3 of the First Schedule shall be a special source.
(2) The income accruing from any special source shall be computed under the class ‘income from special sources’ in accordance with the provisions of the Ninth Schedule.
Computation of income from ordinary sources
Section 14. (1) The income accruing from a source, other than the special sources, shall be computed under the class ‘income from ordinary sources’.
(2) For the purposes of computation under sub-section (1), all income accruing from a source, other than the special sources, shall be classified under the following heads of income:-
A. Income from employment.
B. Income from house property.
C. Income from business.
D. Capital gains.
E. Income from residuary sources.
Aggregation of income under the class ‘Income from Ordinary Sources’
Section 58. (1) The income under any head of income, other than ‘Capital gains’, for any financial year shall be the aggregate of the amount of income computed in respect of each source of income falling under that head of income, for the financial year.
(2) The income under any head of income for any financial year, as computed under sub-section (1), shall be aggregated with the income under any other head of income computed under that sub-section or section 47, for the financial year; and the net result of the aggregation shall be the ‘current income from ordinary sources’, for the financial year.
(3) The ‘current income from ordinary sources’ shall be aggregated with the ‘unabsorbed preceeding year loss from the ordinary sources’, if any; and the net result of the aggregation shall be the ‘gross total income from ordinary sources’, for the financial year.
(4) The ‘gross total income from ordinary sources’, for the financial year, shall be treated as ‘nil’, if the net result of the aggregation under sub-section (3) is negative; and the absolute value of the net result shall be the amount of ‘unabsorbed current loss from ordinary sources’, for the financial year.
Aggregation of income under the class ‘Income from Special Sources’
Section 59. (1) The income from any special source referred to in Rule 3 of the First Schedule shall be the ‘current income from the special source’, for the financial year. (2) The ‘current income from the special source’ referred to in sub-section (1) shall be aggregated with the ‘unabsorbed preceeding year loss from the special source’, if any; and the net result of the aggregation shall be the ‘gross total income from the special source’, for the financial year.
(3) The ‘gross total income from the special source’ referred to in sub-section (2) shall be treated as ‘nil’, if the net result of the aggregation under sub-section (3) is negative; and the absolute value of the net result shall be the amount of ‘unabsorbed current loss from the special source’, for the financial year.
(4) The ‘gross total income from any special source’ computed under the foregoing provisions shall be aggregated with the ‘gross total income from any other special source’, computed under the foregoing provisions, for the financial year; and the net result of the aggregation shall be the ‘total income from special sources’, for the financial year.
Determination of total income
Section 60. The total income of a person for any financial year shall be computed in accordance with the formula- (A - B) + C
Where A = the ‘gross total income from ordinary sources’, for the financial year;
B = the aggregate amount of deductions allowed under sub-chapter I; and
C = the ‘total income from special sources’, for the financial year.
