The meaning of Assessment Year (AY) and Previous Year (PY) are essential for determining the tax liability of a person for a given financial year. Therefore, let us take a brief look into these key concepts. What is Assessment Year in Income Tax ? “Assessment Year“ in Income Tax Act, 1961 (hereinafter referred to as the … Read more
Who is an Assessee in Income Tax Act, 1961 ? Assessee means any person (i.e., Individual, HUF, Firm, Company, AOP/BOI, etc.), who are liable to pay any Tax or any other sum of money (i.e., penalty or interest) under the IT Act. Assessee can also include representative Assessee. Further, Assessee also “INCLUDES” the following categories … Read more
Surcharge on income tax Income tax is one of the primary revenue sources of the Indian Government. The Indian Government imposes a surcharge on taxpayers who earn income above a certain threshold to charge a higher rate of tax from high-income earners. Consequently, it is generally calculated as a percentage of the income tax payable … Read more
Steps to use the Income Tax Calculator An income tax calculator can be used to calculate taxes for different categories of taxpayers for different assessment year. Most of the calculators require prior knowledge of income tax to calculate the right amount of taxes. In order to use the calculator, the following steps should be undertaken (See … Read more
Key Direct Tax Proposals Budget 2022 The Finance Minister of India has tabled the Finance Bill 2022 before the Parliament today. Some of the key direct tax proposals provided in the Finance Bill 2022 , that may impact you are as under : – Individual taxation :- There has been no change in the tax rates … Read more
Introduction Section 50CA of the Income Tax Act, 1961 is a provision introduced in the Finance Act, 2017. The main aim: to curb the practice of undervaluing shares in certain transactions. This section provides for the determination of the fair market value for the transfer of shares. The aim of this provision is to ensure … Read more
Transfer Pricing Assessment Procedure in India Appeal Procedure Power of Assessing Officer to determine the Arm’s Length Price Section 92C(3) gives power to AO to determine the arm’s length price in relation to international transaction and specified domestic transaction under the following circumstances : – a. The price charged or paid in an international transaction … Read more
Computation of Income having regard to the ALP- Section 92 Transfer Pricing provisions have ushered in a new era of regulating cross border transactions between Associated enterprises and addressing issues such as tax evasion, base erosion, etc. The Arm’s Length Price Principle helps in determining the price of a transaction between two unrelated parties. However … Read more
Transactional Net Margin Method The application of Arm’s Length Principle while implementing the provisions of Transfer Pricing, to arrive at the price of a transaction between unrelated parties is essential. However different situations call for application of different methods of the ALP principle, depending on the mitigating factors in every transaction. One such method is … Read more
Profit Split Method Transfer Pricing The application of Arm’s Length Principle while implementing the provisions of Transfer Pricing, to arrive at the price of a transaction between unrelated parties is essential. However different situations call for application of different methods of the ALP principle, depending on the mitigating factors in every transaction. One such method … Read more