Welcome to the Direct Tax Compliance module. Before diving into the complexities of tax, let’s explore the various sources of income.

1.1 Income from Salary:

Overview:

Emoluments received by an individual for services rendered.

Includes basic salary, allowances, bonuses, and perks.

1.2 Income from House Property:

Key Points:

Rental income from owned property.

Calculation involves deductions for municipal taxes and standard deductions.

1.3 Income from Business or Profession:

Business Income:

Earnings from a trade, profession, or business.

Net income after deducting expenses.

1.4 Capital Gains:

Definition:

Profit arising from the sale of capital assets.

Classified as short-term or long-term gains.

1.5 Income from Other Sources:

Diverse Incomes:

Any income not covered under previous heads.

Examples include interest income, lottery winnings, etc.

1.6 Agricultural Income:

Special Category:

Income generated from agricultural land.

Enjoy certain tax exemptions.

1.7 Exempt Incomes:

Tax-Free Categories:

Certain incomes exempted from tax.

Examples include agricultural income, gifts, etc.

1.8 Clubbing of Income:

Family Income:

Provisions to prevent tax evasion.

Includes income of spouse, minor children, etc.

1.9 Residential Status:

Determining Factor:

Based on the number of days an individual stays in India.

Categories include Resident, Non-Resident, and Resident but Not Ordinarily Resident.

1.10 Tax Slabs:

Progressive Taxation:

Different tax rates for various income slabs.

Updated annually in the Union Budget.