CBSE Class 10 Maths Income Tax

Chapter 7

Income Tax

PERSONAL INCOME TAX

Tax imposed by the Government on the income of an indivisual person is known as personal Income tax.

Every indivisual, whose annual income exceeds a certain limit, has to pay tax to the Government known as income tax.

SOME TERMS RELATED TO INCOME TAX

Assessess: - Every individual who pays income tax is called assessee.

Financial Year:- 31st Every year from 1st April to 31stMarch is called financial year.

Assessment Year: – The year next to financial year is called assessment year. For example assessment year is 2006-2007 for the financial year 2005-2006.

Income Tax Return: - Every assess files a statement of previous years income to the income tax department which is called income tax return. It is must.

Income from Salary: - Income from salary includes. Basic Pay; Dearness Allowance (DA), City compensatory allowance (CCA), Interin Relief (IR); Honorium; Bonus; Overtime Allowance, Children’s Education Allowance; Refund of Tuition Fees; Pension, Family Pension; Leave Encashment during service period other than at the time of retirement.

Exemption on Savings: - Saving upto Rs. 1 lakh will be deducted from the following investment before calculating the taxable income:

1.Contributory Provident Fund (CPF)

2. General Provident Fund (GPF)

3. Public Provident Fund (PPF)

4. Life Insurance Premium (LIC)

5. Unit Linked Insurance Plan (ULIP)

6. National Saving Certificate (NSC)

7. Nation Saving Scheme (NSS)

8. Some special infrastructure Bonds

Exercise

[Note: - Reader’s are adviced to consult the tables of saving, donation and income tax as it is given in the starting of the chapter.]

1.Gautam earns an annual salary of Rs. 18,6000. He contributes Rs. 3000 per month to his provident fund and pays an annual premium of Rs.20,000 towards L. I. C. calculate the income tax he has to pay in the last month of the year, if his earlier income tax is deducted for the first 11 month at the rate of Rs. 300 Per month.

2.The annual salary of a male person is Rs. 2,36,786. He contributes Rs. 900 per month to P. F. and pays Rs.3200 as L. I. C. premium. He purchased NSCs for Rs. 40,000 and invested Rs. 1200 in mutual fund. He donates Rs. 3000 owards the Prime Minister Relief fund (eligible for 100% deduction). If his advance tax is deducted at the rate of Rs. 400 per month for first 11 months. Calculate his taxable income in the last month.

3.Mr. Rajan’s income from his salary is Rs. 3,25,000. He contribute towards P. F. Rs. 40,000 annually and his annual premium towards LIC is Rs.25,000. He invested Rs. 15,000 in NSCs and donates Rs. 10,000 to Prime Minister’s relief fund (eligible for 100% tax exemption) and Rs. 8000 to a religious institution (eligible for 50% tax exemption). Calculate the income tax he has to pay in the last month if a sum of Rs. 1800 per month was deducted from his salary for 11 months.

4.The annual income of Mrs. Shoba is Rs.3,26,680. She contributes Rs. 6,500 per month to her PF account and pays an annual premium of Rs. 22,000 towards her L.I.C account calculate the income tax Mrs. Shoba has to pay in the last month of the year, if her earlier deduction as income tax for first 11 month were at the rate of Rs. 1,500 per month.

5.The annual income of Mrs. Jaya Kar is Rs. 3,73,070. She donates Rs.20000 to a charitable Trust (eligible for 50% exemption in tax). She contributes Rs. 2400 per month to her P. F. account and pays an annual insurance of premium of Rs.16,500. Calculate what amount of refund will she get from Income Tax Department? Her earlier deduction as income tax for 12 months were at the rate of Rs.4000 per month.

6.Mr. Bhargava is a senior citizen of age 67 years. He gets consolidated salary of Rs. 2,40,000 annually. He contributes Rs. 30,000 to PPF and donates Rs. 40,000 to PM relief fund (eligible for 100% exemption) and Rs. 3000 in a charitable Hospital (eligible for 5% exemption). Calculate income tax to be paid by him during the year.

Please refer to attached file for CBSE Class 10 Maths Income Tax