Income Tax Act 1961 18 November

INCOME TAX ACT 1961 AFTERSCHO☺OL  – DEVELOPING CHANGE MAKERS CENTRE FOR SOCIAL ENTREPRENEURSHIP PGPSE PROGRAMME – World’ Most Comprehensive programme in social entrepreneurship & spiritual entrepreneurship OPEN FOR ALL FREE FOR ALL

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INCOME TAX ACT 1961 Dr. T.K. Jain.

AFTERSCHO☺OL Centre for social entrepreneurship Bikaner M: 9414430763 [email protected] www.afterschool.tk,, www.afterschoool.tk www.afterschool.tk www.afterschoool.tk www.afterschoool.tk

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TAX? • ANY CHARGE LEVIED BY GOVT. ON INCOME, PRODUCTS OR SERVICES.

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DIRECT TAXES? • THESE INCLUDE THOSE TAXES, WHICH CANNOT BE TRANSFERRED TO ANOTHER PERSON: • INCOME TAX • WEALTH TAX

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INDIRECT TAX • These taxes can be transferred to another  person – therefore their liability is transferable: • Excise • Customs • Service tax • Sales tax • VAT www.afterschoool.tk www.afterschoool.tk

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IT LAW • IT Act • Annual Finance Act • IT rules • Circulars • Case laws and precedents.

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Income • A periodical monetary return - which arises regularly from a definite source. • Income from irregular source (for example: lottery) is also income. • Includes only revnue receipt (not capital receipt) • Income can be on cash or on mercantile basis (it depends on the system adopted by the firm). • Income is chargeable in the next year – e.g. : income of 2005-6 (previous) is chargeable in 20067(assessment year).

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Heads of income? • SALARY • HOUSE PROPERTY • BUSINESS & PROFESSION • CAPITAL GAINS • OTHER SOURCES

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CLUBBING OF INCOME • Income of spouse, minor child have tobe included in the income of the assessee. (subject to some rules / exceptions)

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Set off & carry forward .. • You can have inter – head adjustments (in certain cases) (for example loss in one head can be adjusted with income from another head). • Losses can be carried forward to future years (subject to some rules and guidelines).

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Steps… 1. 2. 3. 4. 5. 6. 7. 8. 9.

Calc alcula ulate inc incom ome e from from diff diffe erent rent hea heads ds Add th the in income omes an and cl club th them. Carry forward / set of off  Find GT GTI (g (gro ros ss to total inc inco ome) Make ake pe permissible de deductio tions Find TI (total income). Apply app appropriate tax tax rate Add surc surcha harg rge e + edu educ catio ationa nall ces cess s Make Make paym paymen entt of of adv advan ance ce tax tax and and TDS TDS and and find returns of income (as per rules).

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assessee • Sec. 2 (7) • Any person --- .included deemed assessee or assessee in default also

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Person 2 (31) • • • • • • • • •

Include the following: Individual HUF Company Firm AOP (association of persons) BOI (body of individuals) Local authority (like municipalities etc.) Artificial juridical person.

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Company • Sec. 2 (17) • Includes foreign companies also • Includes associations, which have been assessed as company by CBDT. (central board of direct taxes)

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Company in which public are interested (sec. 2 (18) ) • Sec. 25 company • Govt. company • Company whose shares are public listed • A company which accepts public deposits • 50% capital is owned by cooperatives • Declared by board for this.

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Income (sec. 2(24) ) • Includes profits, dividends, volutnary contributeions received by trusts etc. , perqs, allowances, deemed profits, capital gains, winnings from lottery, money received under keyman insurance, PF, ESI etc. (subject to rules and exemptions)

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DIVIDEND (SEC. 2 (22) • Bonus is not dividend • Distribution of debentures , deposit certificates etc. and bonus shares to prefernece shareholders are dividends • Reduction of capital to the extent of  accumulated profits is also dividend • Advance / loan to another company (closely held company) is also dividend • Any accumulated profit distributed is dividend www.afterschoool.tk www.afterschoool.tk

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Closely held company • 20% interest in any company • Or  • 10% in a company – which does not have public interest

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Taxation of dividend • 12.5% flat rate of dividend (in addition to normal income tax charged on income of  the company) • This is not applicable on dividend d ividend from foreign companies • This is not applicable on deemed dividends • (don’t add it in normal income). www.afterschoool.tk www.afterschoool.tk

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Fringe benefits … • Sec. 115WB • Any privilege • Free tickets (or concessional) • Payment by employer for any benefits, health clubs etc.

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Infrastructure …. • Infrastructure capital company (sec. 2(26A)) • Infrastructure capital fund (sec. 2(26B)) • Includes telecom, power generation, industrial parks, SEZs, 3 star hotels, hospitals (at least 100 bed hospital) , etc.

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Income Tax Rates … • FOR NORMAL INDIVIDUAL / HUF/BOI/AOP etc. • First 110000 = Nil • Till next 150000 = 10% • Next 250000 = 20% • On balance = 30%.

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Other tax rates…. • 20% on long term capital gain • 10% on short term capital gains (sec. 111A) • 30% on lottery etc.

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ABOUT AFTERSCHO☺OL Afterschoool conducts three year integrated PGPSE (after class 12th along with IAS / CA / CS) CS) and 18 month PGPSE (Post Graduate Programme in Social Entrepreneurship) along with preparation for CS for  CS / CFP / CFA /CMA / FRM. FRM. This course is also available online also. It also conducts workshops on social entrepreneurship in schools and colleges all over India – start social entrepreneurship club in your institution today with the help from afterschoool and help us in developing society.

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Why such a programme? • To promote people to take up entrepreneurship and help develop the society • To enable people to take up franchising fr anchising and other such options to start a business / social development project • To enable people to take up social s ocial development as their mission • To enable people to promote spirituality spiri tuality and positive thinking in the world www.afterschoool.tk www.afterschoool.tk

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Who are our supporters? • Afterschoolians, our past beneficiaries, entrepreneurs and social entrepreneurs are supporting us. • You can also support us – not necessarily by money – but by being promotor of our  concept and our ideas.

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About AFTERSCHO☺OL PGPSE – the best programme for developing great entrepreneurs • Most flexible, adaptive but rigorous programme • Available in distance learning mode • Case study focused- latest cases • Industry oriented practical curriculum • Designed to make you entrepreneurs – not just ju st an employee • Option to take up part time job – so earn while you learn • The only absolutely free course on internet i nternet www.afterschoool.tk www.afterschoool.tk

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Workshops from AFTERSCHO☺OL • • • • • • • • •

IIF, Delhi CIPS, Jaipur  ICSI Hyderabad Branch Gyan Vihar, Jaipur  Apex Institute of Management, Jaipur  Aravali Institute of Management, Jodhpur  Xavier Institute of Management, Bhubaneshwar  Pacific Institute, Udaipur  Engineering College, Hyderabad

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Flexible Specialisations: • • • • • • • • • •

Spiritualising Spiritualising business and society Rural development and transformation HRD and Education, Social Development NGO and voluntary work Investment analysis,microfinance and inclusion Retail sector, BPO, KPO Accounting & Information system (with CA / CS /CMA) Hospital management and Health care Hospitality sector and culture and heritage Other sectors of high growth, high technology and social relevance

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Salient features: • The only programme of its kind (in the whole world) • No publicity and low profile course • For those who want to achieve success in life – not just a degree • Flexible – you may stay for a month and continue the rest of  the education by distance mode. / you may attend weekend classes • Scholarships for those from poor economic background • Latest and constantly changing curriculum – keeping pace with the time • Placement for those who are interested • Admissions open throughout the year  • Latest and most advanced technologies, books and study material www.afterschoool.tk www.afterschoool.tk

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Components • • • • • • • • • • • • • •

Pedagogy curriculum and approach based on IIM Ahmedabad and ISB Hyderabad (the founder is alumnus from IIMA & ISB Hyderabad) Meditation, spiritualisation, and self development EsGotitial softwares for business Business plan, Research projects Participation in conferences / seminars Workshops on leadership, team building etc. Written submissions of research projects/articles / papers Interview of entrepreneurs, writing biographies of entrepreneurs Editing of journals / newsletters Consultancy / research projects Assignments, communication skill workshops Participation in conferences and seminars Group discussions, mock interviews, self development diaryng Mind Power Training & writing workshop (by Dr. T.K.Jain)

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Pedagogy • • • • • • • • •

Case analysis, Articles from Harvard Business Review Quiz, seminars, workshops, games, Visits to entrepreneurs and industrial visits PreGotitations, PreGotitations, Latest audio-visuals audio-visuals Group discussions and group projects Periodic self assessment Mentoring and counselling Study exchange programme (with institutions out of  India) • Rural development / Social welfare projects www.afterschoool.tk www.afterschoool.tk

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Branches • AFTERSCHO☺OL will shortly open its branches in important cities in India including Delhi, Kota, Mumbai, Gurgaon and other important cities. Afterschooolians will be responsible for  managing and developing these branches  – and for promoting social entrepreneurs.

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Case Studies • We want to write case studies on social entrepreneurs, first generation entrepreneurs, ethical entrepreneurs. Please help us in this process. Help us to be in touch with entrepreneurs, so that we may develop entrepreneurs.

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Basic values at AFTERSCHO☺OL AFTERSCHO☺OL • • • • • •

Share to learn more Interact to develop yourself  Fear is your worst enemy Make mistakes to learn Study & discuss in a group Criticism is the healthy route to mutual support and help • Ask fundamental questions : why, when, how & where? • Embrace change – and compete with yourself  only www.afterschoool.tk www.afterschoool.tk

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www.afterschoool.tk social entrepreneurship for better  society

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