If the person sells a capital asset that forms part of the block of assets on which depreciation has been allowed as per the provisions of the Income Tax Act, the income from such sales is a capital gain. In this article, we will discuss about the Section 50 which provides for the computation of capital gains in case of depreciable assets.The calculation of capital gain or loss arising on the sale of depreciable assets can be divided into two categories:Where some assets are sold from the blocks of assets.Where all assets of the block are transferred and the block of assets ceases to exist.Budget 2025 UpdateIt is proposed to include ULIPs with premiums exceeding 10% of the policy’s sum assured, alongside those with annual premiums above Rs. 2.5 lakh.It is proposed to amend Section 2(14) to clarify that securities held by investment funds under Section 115UB, will be treated as capital assets.What are Depreciable Assets?The assets which gradually lose value over time due to wear and tear, usage, or obsolescence are called as depreciable assets. The decrease in value is called as depreciation and is claimed as deduction under the Income Tax Act. What is a Block of Assets?According to Section 2(11) of the Act, a 'block of assets' refers to a group of assets within a class that includes both tangible and intangible assets, all subjected to the same prescribed depreciation rate. Block of assets simply means same class of assets with same rate of depreciation.

Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) are provisions of the Income Tax Act which require the person making payment to deduct or the person receiving the payment to collect a certain amount and deposit it with the government. This ensures that the government receives tax before filing a tax return. The TDS and TCS statements need to be filed with the authority within specified due dates to ensure proper compliance and avail tax credit for the same. Any failure will result in a penalty or a late fee. In this article we will discuss the provisions related to late filing of TDS/TCS statements.What Is Section 234E Of The Income Tax Act 1961?Section 234E of the Income Tax Act 1961 outlines the provisions and limits with respect to fees for late or non-filing of TDS/TCS statements by the deductor or collector as the case may be. The section imposes a fee of Rs.

The Budget 2019 proposed various changes to the existing sections of the income tax laws and introduced some new Sections for TDS, such as 194M and 194N.194M – TDS on payment to resident contractors and professionals. Continue reading to know more.194N – TDS on cash withdrawal in excess of Rs 1 crore. Click here to read more about section 194N.Budget 2025 updateThe Union Budget 2025 proposed the rationalisation of Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) to ease compliance challenges for taxpayers especially for middle-income earners. The government has raised the threshold limits across various TDS sections, aiming to simplify the tax process. The proposed changes are as followsSectionPresentProposed 193 - Interest onsecuritiesNIL10,000194A - Interest other thanInterest on securities(i) 50,000/- for seniorcitizen;(ii) 40,000/- in case ofotherswhen payer is bank,cooperative society andpost office(iii) 5,000/- in othercases(i) 1,00,000/- for seniorcitizen(ii) 50,000/- in case ofotherswhen payer is bank, cooperativesociety and postoffice(iii) 10,000/- in other cases194 – Dividend, for an individual shareholder5,00010,000194K - Income in respect of units of a mutual fund5,00010,000194B - Winningsfrom lottery, crossword puzzle Etc. &194BB - Winnings from horse raceAggregate of amountsexceeding 10,000/-during the financial year10,000/- in respect of asingle transaction 194D - Insurance commission15,00020,000194G - Income by way ofcommission, prize etc.

When the income of an individual taxpayer is below the basic exemption limit in a financial year, the tax liability is zero; thus, such individuals do not have to file any income tax return as per provision of Section 139(1) under the Income-tax Act, 1961. Such individuals do not have to file an income tax return as they do not fall in the tax bracket and get an exemption from filing the return. But if they file ITRs even when their income is below the basic exemption limit, it is termed ‘Nil Return’. Although it is not mandatory to file nil returns, there are many benefits to filing nil returns.The basic Exemption limit is as follows, depending on the tax regime that you choose.The Old Tax Regime basic exemption is as followsRs 2,50,000 for age less than 60 yearsRs 3,00,000 for ages between 60 - 80 yearsRs 5,00,000 for ages more than 80 yearsNew Tax Regime - Rs 3,00,000 is the basic exemption limit.Budget 2025 UpdatesThe new Income Tax Bill has been tabled by the Honorable Finance Minister in the Lok Sabha. It aims to simplification and better presentation of the provisions.As per the budget 2025, the income up to Rs.

It is essential to understand the provisions of the Income-tax Act,1961, applicable to the services provided by consultants. For effective tax planning, consultants must be well-versed in the regulations outlined in the Income-tax Act, 1961.Budget 2025 UpdateIt was proposed to increase the threshold limit for TDS deduction u/s 194J - Fees for Professional or Technical Services to Rs. 50,000 from the previous limit if Rs. 30,000.Who is a Consultant?The terms "consultant" or "profession" are not explicitly defined in the Income Tax Act, 1961. However, the explanation of Section 194J and the definition of "profession" under Section 2(36) give an insight.Understanding "Professional Services" According to Section 194JProfessional services include legal, medical, engineering, architecture, accountancy, technical consultancy, interior decoration, and advertising.

Indexation plays an important role in calculating gain or loss on your investments. Indexation will reduce your overall tax liability by adjusting the purchase price of the underlying asset or investment. You will be able to realise higher gains as you can adjust them against the rate of inflation of the year of purchase and sale. We have covered the following in this article.What Is Indexation?Are you worried about inflation reducing your returns? Does the income tax law consider inflation while calculating capital gains on the sale of investments? Stop worrying, start indexation!Indexation is an efficient way of preventing draining of your returns on investments in the form of taxes. Indexation is applicable to long-term investments, which include debt fund and other asset classes.

When a property is received on inheritance or as a gift, it is not taxable for the receiver. When the inheritor or the receiver of this gift of property sells it, capital gains on the sale are taxable for the inheritor. the inherited assets may include immovable property and movable assets like gold, shares, deposits,etc. In this article, you will learn about tax implications on sale of inherited property.Budget 2025 UpdateIt is proposed to include ULIPs with premiums exceeding 10% of the policy’s sum assured, alongside those with annual premiums above Rs. 2.5 lakh.It is proposed to amend Section 2(14) to clarify that securities held by investment funds under Section 115UB, will be treated as capital assets.What is Inherited Property?The property passed down or transferred to the legal heirs of a deceased person is called inherited property.

The income tax is a direct tax which follows a progressive slab rate, where the rate of tax increases as the taxpayer's income rises. The Income-tax Act, 1961 provides for two tax regimes: the old regime, which allows various deductions and exemptions, and the new regime, which offers lower tax rates without exemptions.Budget 2025 UpdatesThe new Income Tax Bill has been tabled by the Honorable Finance Minister in the Lok Sabha. It aims to simplification and better presentation of the provisions.As per the budget 2025, the income up to Rs. 12,00,000 will have zero tax liability for the FY 2025-26 (AY 2026-27) under the new tax regime. Here's how:The revised tax slabs under the new regime for FY 2025-26 (AY 2026-27) are as follows:Annual Income Tax Slabsincome Tax RatesUpto Rs.

  Any profit or gain that arises from the sale of shares is treated as Capital gains under the Income Tax Act. Capital gains are further classified as short-term or long-term based on their holding period. Gains from equity shares listed on a recognised stock exchange having a holding period of less than or equal to 12 months are considered short-term capital gains. Short-term capital gains (STCG) from shares are classified into two parts:Short-term capital gains as per section 111AShort-term capital gains other than section 111A STCG Tax Rate on Shares (Section 111A)Short-term capital gain under Section 111A is taxed at a concessional rate of 15% with applicable cess. However, with effect from 23rd July 2024, the tax on Short-term capital gain under Section 111A has been increased to 20%.Budget 2025 UpdateIt is proposed to include ULIPs with premiums exceeding 10% of the policy’s sum assured, alongside those with annual premiums above Rs.

  Any profit and gains arising from the transfer of capital assets such as property, shares, bonds, vehicles, etc., shall be chargeable to tax under the head "Income from Capital Gains." Capital assets are classified into short-term and long-term assets. Budget 2025 UpdateIt is proposed to include ULIPs with premiums exceeding 10% of the policy’s sum assured, alongside those with annual premiums above Rs. 2.5 lakh as capital assets, and the income arising from redemption as capital gains.It is proposed to amend Section 2(14) to clarify that securities held by investment funds under Section 115UB, will be treated as capital assetsShort-term capital gain/loss arises if a short-term capital asset is transferred. A short-term capital asset is an asset which is held for a period of less than or equal to 24 months, except for certain exceptions where the period is shorter: listed securities and equity-oriented funds qualify if held for less than or equal to 12 months, while all other assets require a holding period of less than or equal to 24 months to be considered short-term capital assets. Capital gains arising from transfer of units of a specified mutual fund acquired on or after 1.4.2023 and market linked debentures would always be deemed as arising from transfer of short term capital assets irrespective of the period of holding of such assets. Further, as per the change in Budget 2024, capital gains on sale of unlisted debentures and unlisted bonds transferred on or after 23rd July, 2024, shall always be short term and be taxable at slab rates, irrespective of the holding period.