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TRADE BITCOIN
TUESDAY, NOVEMBER 26, 2019 INTRODUCTION TO TAX LAWS INTRODUCTION TO TAX LAWS This article discusses different components of Income Tax Law. Before we discuss components, it is important to know the difference between an act and a law. So, let me ask you. What is the difference between an act and a law? Are both the same? The answer is no. An act is just a part of the law. Law is basically a broader subject that includes various acts. The components of IT law The Income Tax Act, 1961 - This is the most important component of IT law. It contains the legislations or the provisions of IT law. The Income Tax Rules, 1962 This defines the procedure to be followed in compliance with the provisions of the act. Note - You need to understand the difference between Act and Rules. An Act will only state the provisions. It will not define the ways to carry on the provision. However, IT rules will state the process to be followed.Annual Finance Act
This is popularly known as budget. It prescribes the rates of income tax to be followed for a given financial year. It also brings amendments in the IT law. Circulars and Notifications These are issued by the Ministry of Finance. Circulars are explanatory in nature. They do not add any new section or provisions. They only explain the existing provision.Case Laws
These are the judicial pronouncements of the court. The judge of the High Court is binding in a particular state, i.e., It is territorial jurisdiction. However, the judgement of the supreme court is binding throughout the country and is the law of the land. Discussion about Section 1 and Section 2 For any Act, Section 1 defines the date of applicability and place of applicability. For example the IT Act, 1961 was passed in the parliament and not forced. The date of Applicability of the IT Act, 1961 was 1st April, 1962. Section 2 consists of definitions. It is always presented inalphabetical order.
Concept of Previous Year and Assessment Year Under Income Tax, a year always starts from 1st April and ends on 31st March. Whatever income is earned in one particular year, the taxes are paid in the next year. If income is earned in the year 2013-14, tax is paid in 2015-16. The year in which income is earned is termed as previous year. It should be made clear that previous year does not refer to the earlier year, but it means the current accounting year. The year in which we pay taxes is termed as Assessment Year. Income is taxable on? Income is taxable on salaries, house property, business profession, capital gains and other sources. di November 26, 2019No comments:
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