आयकर व वस्तू व सेवा कर Income Tax and GST

थोडक्यात सारांश

Capital gains (भांडवली नफा) is profit on the transfer of a capital asset such as land, building, shares or gold (Sections 45 to 55). The gain is short-term or long-term depending on how long the asset was held. Income from other sources (Sec 56 to 59) is the residual head for income not covered by the other four heads, such as interest, dividends, lottery winnings and certain gifts.

महत्त्वाचे मुद्दे

• A capital asset is any property held by the assessee, except stock-in-trade, personal movable assets (clothes, furniture, car), and rural agricultural land.
• Holding periods (transfers on or after 23 July 2024): listed securities and units of equity funds – more than 12 months is long-term; all other assets – more than 24 months is long-term.
• Short-term capital gain (STCG) = sale price − expenses on transfer − cost of acquisition − cost of improvement.
• Long-term capital gain (LTCG): since 23 July 2024 generally taxed at 12.5% without indexation. For land or building bought before that date, an individual or HUF may choose 20% with indexation, whichever tax is lower.
• Listed equity shares and equity funds (STT paid): STCG 20% (Sec 111A); LTCG 12.5% on gain above ₹1.25 lakh (Sec 112A).
• Exemptions: Sec 54 (house sold, new house bought), Sec 54F (any long-term asset sold, house bought), Sec 54EC (gain invested in specified bonds within 6 months, up to ₹50 lakh), Sec 54B (agricultural land).
• Other sources include dividends, interest on bank deposits and securities, rent of vacant land or machinery, family pension, and casual income.
• Casual income (lottery, crossword, game shows, online games) is taxed at a flat 30% with no deductions or basic exemption.
• Gifts (Sec 56(2)(x)): money or property above ₹50,000 in a year from non-relatives is taxable; gifts from relatives, on marriage, or by will are exempt.
• Family pension: deduction of one-third or ₹15,000 (₹25,000 in the new regime), whichever is less.

महत्त्वाच्या संज्ञा

• Transfer – sale, exchange, giving up rights, or compulsory acquisition of an asset.
• Cost of improvement – capital expense on additions or alterations to the asset.
• Indexation – raising the cost by the Cost Inflation Index to remove the effect of inflation.
• Securities Transaction Tax (STT) – tax paid on buying and selling shares on a stock exchange.

नमुने व सूत्रे

५ महत्त्वाचे प्रश्न

Q1. What is a capital asset?

Property of any kind held by the assessee, whether or not connected with business, except stock-in-trade, personal effects and rural agricultural land in India.

Q2. How is casual income taxed?

Winnings from lotteries, crosswords, races and game shows are taxed at a flat 30% (plus cess) under Sec 115BB; no expense or deduction is allowed against them.

Q3. Mrs. Kulkarni bought land in 2016 for ₹20,00,000 and sold it in December 2025 for ₹50,00,000, paying brokerage of ₹50,000. Compute the capital gain and tax at 12.5% (without indexation).

Held for more than 24 months, so it is long-term.

Cess at 4% is added on the total tax. (She may also compare with 20% after indexation, since the land was bought before 23 July 2024.)

Q4. Explain the exemptions from capital gains under Sections 54, 54EC and 54F.

Outline: who can claim, which asset is sold, in what the gain must be invested, time limits (purchase 1 year before or 2 years after, construction within 3 years; bonds within 6 months), amount exempt, lock-in and withdrawal of exemption on transfer of the new asset.

Q5. What incomes are taxable under "Income from Other Sources"? Explain the deductions allowed.

Outline: Sec 56 list (dividends, interest, casual income, gifts, family pension, rent of machinery, interest on enhanced compensation); deductions under Sec 57 (collection charges, depreciation on let machinery, family pension deduction); Sec 58 disallowances.

परीक्षेसाठी टीप

Always state first whether the gain is short-term or long-term with the holding period. Most marks are lost by applying the wrong tax rate.

थोडक्यात सारांश

After adding incomes under all five heads we get Gross Total Income (GTI). Deductions under Chapter VI-A (Sec 80C to 80U) are subtracted to get Total Income. Tax is then calculated on total income under the old regime or the new regime (Sec 115BAC, the default), rebate under Sec 87A is given, and 4% health and education cess is added.

महत्त्वाचे मुद्दे

• Sec 80C: up to ₹1,50,000 for LIC premium, PPF, EPF, ELSS, tuition fees of 2 children, home-loan principal, 5-year bank FD, NSC, Sukanya Samriddhi.
• Sec 80CCD(1B): extra ₹50,000 for NPS contribution.
• Sec 80D: health insurance – ₹25,000 for self and family (₹50,000 if senior citizen), and the same again for parents.
• Sec 80E: interest on education loan, no upper limit, for 8 years.
• Sec 80G: donations to approved funds and charities – 100% or 50%, with or without a limit.
• Sec 80TTA: savings bank interest up to ₹10,000; 80TTB: deposit interest up to ₹50,000 for senior citizens.
• New regime: lower slab rates but most deductions are not allowed. Allowed: standard deduction ₹75,000 and employer's NPS contribution (80CCD(2)).
• Rebate u/s 87A: new regime – tax rebate up to ₹60,000 when total income does not exceed ₹12,00,000; old regime – up to ₹12,500 when total income does not exceed ₹5,00,000.
• Marginal relief in the new regime: if income is slightly above ₹12 lakh, tax cannot exceed the income above ₹12 lakh.

महत्त्वाच्या संज्ञा

• Gross Total Income – total of the five heads after set-off of losses.
• Total Income – GTI minus Chapter VI-A deductions.
• Rebate – reduction in the tax itself (not in income).
• Cess – extra 4% health and education cess on income tax.

नमुने व सूत्रे

Slab rates for individuals, FY 2025-26 (check the current year's figures):

Format: GTI → less Chapter VI-A deductions → Total income (rounded to nearest ₹10) → tax on slabs → less rebate u/s 87A → add 4% cess → tax payable.

५ महत्त्वाचे प्रश्न

Q1. What is Gross Total Income?

The total of income under the five heads – salary, house property, business or profession, capital gains and other sources – after clubbing and set-off of losses, before Chapter VI-A deductions.

Q2. State any four investments eligible for deduction under Section 80C.

Life insurance premium, Public Provident Fund, Employees' Provident Fund contribution, and tuition fees for up to two children (also ELSS, NSC, home-loan principal).

Q3. Mr. Deshmukh (age 40) has GTI of ₹8,00,000. Under the old regime he invests ₹1,50,000 in PPF and pays health insurance premium ₹25,000. Compute his tax.

No rebate, since total income is above ₹5,00,000.

Q4. A salaried person has gross salary ₹13,00,000 and no other income. Compute tax under the new regime for FY 2025-26.

Taxable salary = 13,00,000 − 75,000 = ₹12,25,000.
Tax on slabs: 4–8 lakh @ 5% = 20,000; 8–12 lakh @ 10% = 40,000; 12–12.25 lakh @ 15% = 3,750; total ₹63,750.
Income exceeds ₹12 lakh by ₹25,000, so marginal relief limits tax to ₹25,000.
Add cess 4% = ₹1,000. Tax payable = ₹26,000.
(If gross salary were ₹9,00,000: taxable ₹8,25,000, tax ₹22,500, fully cancelled by the 87A rebate, so tax = nil.)

Q5. Compare the old and new tax regimes for individuals.

Outline: slab rates; deductions allowed and not allowed; standard deduction; rebate limits; who gains from each (people with large 80C/HRA/home-loan claims may prefer the old regime); the new regime is the default and a salaried person can choose each year.

परीक्षेसाठी टीप

Show slab-wise working line by line. Round total income to the nearest ₹10 before applying rates, and always add cess at the end.

थोडक्यात सारांश

Goods and Services Tax (GST) (वस्तू व सेवा कर) is a single, destination-based indirect tax on the supply of goods and services. It replaced many older taxes such as excise duty, service tax, VAT and entry tax from 1 July 2017. This topic covers the structure of GST, the GST Council, the concept of supply, and registration.

महत्त्वाचे मुद्दे

• GST was introduced by the 101st Constitutional Amendment Act, 2016. Laws: CGST Act, SGST Acts, IGST Act and UTGST Act, 2017.
• Dual GST: on an intra-state supply, the Centre levies CGST and the State levies SGST (or UTGST); on an inter-state supply and on imports, the Centre levies IGST.
• GST Council (Article 279A): chaired by the Union Finance Minister, with State Finance Ministers as members; it recommends rates, exemptions and rules.
• Taxable event is supply (Sec 7 of the CGST Act): sale, transfer, barter, exchange, licence, rental, lease made for consideration in the course of business.
• Composite supply is taxed at the rate of its principal supply; mixed supply at the highest rate among its items.
• Outside GST: alcohol for human consumption; petroleum crude, diesel, petrol, natural gas and aviation turbine fuel (GST not yet levied).
• Rates: from 22 September 2025 the main slabs are 5% and 18%, with 40% on a few luxury and sin goods, besides nil-rated items and special low rates (e.g. 3% on gold).
• Registration is compulsory when aggregate turnover exceeds ₹40 lakh (supply of goods) or ₹20 lakh (services) in a normal state like Maharashtra; lower limits (₹20 lakh / ₹10 lakh) apply in some special-category states.
• Compulsory registration regardless of turnover: inter-state suppliers of goods, e-commerce operators and sellers through them (with some exceptions), casual taxable persons, persons under reverse charge, non-resident taxable persons.
• Composition scheme: for small taxpayers with turnover up to ₹1.5 crore (₹75 lakh in special states); tax at 1% for manufacturers and traders, 5% for restaurants; no input tax credit and no tax collection from customers.
• GSTIN is a 15-character number: 2-digit state code (Maharashtra = 27) + 10-character PAN + entity number + "Z" + check digit.

महत्त्वाच्या संज्ञा

• Aggregate turnover – total value of taxable, exempt, export and inter-state supplies under the same PAN, excluding taxes.
• Reverse charge – the receiver, not the supplier, pays GST on certain supplies.
• Place of supply – decides whether a supply is intra-state or inter-state.
• HSN / SAC – codes used to classify goods / services.

नमुने व सूत्रे

Example: goods worth ₹1,00,000 at 18% GST.

५ महत्त्वाचे प्रश्न

Q1. What is GST?

GST is a comprehensive, multi-stage, destination-based indirect tax levied on every value addition in the supply of goods and services, with credit for tax paid on inputs.

Q2. What is the composition scheme?

An optional simple scheme for small taxpayers (turnover up to ₹1.5 crore) who pay tax at a low fixed rate on turnover, file fewer returns, cannot charge GST on invoices and cannot claim input tax credit.

Q3. Explain the dual structure of GST with examples.

Outline: CGST, SGST/UTGST, IGST; who levies and collects each; intra-state vs inter-state; use the ₹1,00,000 example; settlement of IGST between Centre and States.

Q4. Explain the provisions for registration under GST.

Outline: threshold limits; compulsory registration cases; voluntary registration; procedure on the GST portal (Form REG-01, PAN, mobile and email verification, Aadhaar authentication, ARN, certificate in REG-06); structure of GSTIN; cancellation.

Q5. Explain the features and advantages of GST.

Outline: one nation one tax, removal of cascading effect (tax on tax), seamless input tax credit, destination-based, online compliance, GST Council; advantages to business, consumers and government; criticisms (compliance load, petroleum outside GST).

परीक्षेसाठी टीप

Remember the date 1 July 2017 and the 101st Amendment. In any numerical, write the state names to show clearly why you chose CGST + SGST or IGST.

थोडक्यात सारांश

Input Tax Credit (ITC) (इनपुट कर जमा) means a registered person can reduce the GST he pays on sales by the GST he has already paid on purchases used in business. This removes "tax on tax". This topic covers the conditions for ITC, blocked credits, the order of using credits, and the main GST returns.

महत्त्वाचे मुद्दे

• ITC is available on inputs, capital goods and input services used in the course of business (Sec 16 of the CGST Act).
• Conditions for ITC: (1) a valid tax invoice or debit note; (2) goods or services actually received; (3) the supplier has paid the tax to the government; (4) the recipient has filed his return; (5) the invoice appears in the recipient's GSTR-2B.
• If the supplier is not paid within 180 days from the invoice date, the ITC must be reversed (it can be re-claimed on payment).
• Blocked credits (Sec 17(5)): motor vehicles for personal travel (with exceptions), food and beverages, beauty treatment, health services, club membership, works contract for immovable property, goods lost, stolen or given as free samples, and goods or services for personal use.
• Order of using ITC: IGST credit is used first for IGST, then for CGST and SGST (in any order or proportion). CGST credit → CGST, then IGST. SGST credit → SGST, then IGST. CGST credit can never be used for SGST, or SGST credit for CGST.
• Tax not covered by credit is paid in cash through the electronic cash ledger.
• Composition taxpayers cannot take ITC.

महत्त्वाच्या संज्ञा

• Electronic credit ledger – shows the ITC available to a taxpayer.
• Electronic cash ledger – shows cash deposited for paying GST.
• GSTR-2B – auto-drafted monthly statement of ITC available, from suppliers' filings.
• QRMP scheme – Quarterly Return, Monthly Payment, for taxpayers with turnover up to ₹5 crore.

नमुने व सूत्रे

ITC rule: Net GST payable in cash = Output tax − Eligible ITC (used in the legal order).

५ महत्त्वाचे प्रश्न

Q1. What is input tax credit?

The credit of GST paid on purchases of goods and services used in business, which can be set off against the GST payable on outward supplies.

Q2. What is GSTR-3B?

A monthly (or quarterly) self-declared summary return showing outward supplies, ITC claimed and tax paid; tax is paid along with it.

Q3. A dealer's output tax: IGST ₹20,000, CGST ₹30,000, SGST ₹30,000. ITC available: IGST ₹35,000, CGST ₹10,000, SGST ₹12,000. Compute the tax payable in cash.

Total cash payable = ₹23,000. Check: total output ₹80,000 − total ITC ₹57,000 = ₹23,000. (The remaining IGST credit of ₹15,000 could also be split between CGST and SGST; the cash total stays the same here.)

Q4. Explain the conditions for claiming ITC and the blocked credits.

Outline: five conditions of Sec 16(2); 180-day payment rule; time limit (30 November after the year or the annual return date, whichever is earlier); blocked credits list from Sec 17(5) with examples.

Q5. Explain the different returns under GST.

Outline: GSTR-1, GSTR-3B, GSTR-2B, CMP-08, GSTR-4, GSTR-9, GSTR-9C; who files, contents and due dates; late fee and interest; benefits of the QRMP scheme.

परीक्षेसाठी टीप

In ITC numericals, always use IGST credit first. Write the rule "CGST and SGST cannot be cross-utilised" under your table.