How to Compute Tax Liability for Individual Assessee

An Individual is responsible to pay tax in respect of his own income. Individual Income exempted under section 10, 10A, OR 10B OR 10BA and deduction under section 80C, 80CCC, 80CCD, 80CCF, 80D, 80DD, 80DDB, 80E, 80G, 80GG, 80GGA, 80GGC, 80-IA, 80-IB, 80-IC, 80-ID, 80-IE, 80JJA, 80QQB, 80RRB AND 80U

Special provision relating to non-residents [Section 115C to 115I]-

‘Non- resident Indians’ can take the benefit of special provision under section 115C to 115-I:

Who can claim the benefit of special provisions

The benefit of special provisions can be claimed by non-resident Indian. The following are “non-resident Indian” for this purpose:

  1. Citizen of India who is non-resident; or
  2. A person of Indian origin who is a non-resident.

A person shall be deemed to be Indian origin if he, or either of his parents or any of his grandparents, was born in individual India.

Income which are qualified for special treatment –

The provision under section 115C to 115-I are applicable only in respect of the following income derived by a non-resident Indian under section 115C to 115-I:

  • long term capital gain from sale and transfer of “foreign exchange assets”;
  • Investment income derived from a “foreign exchange assets”.

“Foreign exchange assets” means “specified assets”

The following are “Special assets” for this purpose:

  1. Debentures issued by an Indian company (which is not a private company) ;
  2. Shares in an Indian company (public or private) ;    
  3. Deposits with an Indian company( not a private company) ;
  4. Any security of the central government.
  5. Such other assets as the Central government may specify in this behalf by notification in the official Gazette [no notification has been issued so far]

How to calculate investment income:

In computing the investment income of a non-resident Indian, no deduction in respect of any expenditure or allowance shall be allowed under any provision of this act. Moreover, no deduction under section 80C to 80U shall be allowed in respect of investment income of non resident.

6 thoughts on “How to Compute Tax Liability for Individual Assessee

  1. my gross salary for fy2013-14 is 250000(projected)kindly show the detail of income tax calculation.
    my investments are as below:
    p.f.-22348
    h.r.a rebate-2359.19

    1. Gross Salary – Rs 250000/-
      HRA Rebate – 2359/-
      Income From Salary – Rs 247641/-
      Less 80C Deduction – 22348/-
      Net Total Income – Rs 225293/
      Tax Payable (10% on Rs.25293/-) – Rs 2529/-
      Cess (3%) Rs 76/-
      Interest if no TDS –

      Total Tax Payable – 2605+interest if any

  2. my income is from salary….. can i claim interest on housing loan for under construction house property if the loan amount is 20lac reply please

  3. Dear Sir,

    My annual gross salary is Rs. 510,000/-
    HRA Rebate 106,000/-
    Conveyance Rebate 9,600/-
    no any other rebate is there
    please tell me what is my income tax on my salary.

    Thanks.
    S.K.Goyal

    1. For FY 2013-14
      Gross Salary = 510000
      Less HRA 106000/-(assuming that its amount available for deduction)
      Less Conveyance 9600
      Net Taxable Salary = 394400
      Deduction = 220000
      Tax Payable on 174400 @ 10.36% = 18068/-
      Income Tax on your Salary

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