Debit income & contract income taxation
Stephen
(Querist) 11 April 2016
This query is : Resolved
Dear Tax Experts,
Greetings…
I have few query on taxation..
I am a retired person having simple debt based income, post retirement I just started working as contract basis. Now will my employer deduct any tax from my contract amount and how should I file my income tax return under which form/s showing both debit based income and contract based salary also what would be allowable deductions can I claim.
Appreciate your help.
Thanks
Stephen
Ms.Usha Kapoor
(Expert) 13 August 2016
If you are 60 years your annual income does not exceed Rs. 3LAKHS INXLUDING YOUR PPNSION OTHER THAN pROVIDENT FUND AND GRARTUITY ETC WHICH ARE FULLY EXEMPT FROM iNOME TAX AND YOUR PRESENT SALARY + YOUR DEBT INCOME ALL DO NOT EXCEED 3 lAKH RUPEES YOUR income tax liability is nil. If it exceeds 3 lakhs rupees you would be taxed both on your current salary income,Pension and income from your debt funds such as non convertible debentures and bonds such as National Highway Authority of India. The PF and gratuity are FULLY EXEMPT FROM TAX. However IF YOU SELL THEM AFTER one year YOU'D BE TAXED ON YOUR long TERM CAPITAL GAINS.tThe CAPITAL GAINS WOULD BE CHARGED to tax for both short term and long term. ON THE BASIS OF FOLLOWING CALCULATION. sale PRICE-COST INFLATION INDEX OF PURCHASE PRICE
OR COST INFLATION INDEX OF SALE PRICE/COST INFLATION INDEX OF PURCHASE PRICE AT THAT PARTICULAR YEAR BOTH IN RESPECT OF SALE PRICE AND PURCHASE PRICE. .YOUR INTEREST INCOME ON YOUR DEBT FUNDS OR DEBT INCOME WOULD BE COMPLETELY TAX FREE.As regards tax liability of capital gains indexed ones have less tax liability than non indexed ones.
