TMI BlogInstructions for deduction of tax at source from salary during financial year 1970-71 at the rates specified in Part III of First Schedule to Finance Bill, 1970X X X X Extracts X X X X X X X X Extracts X X X X ..... which income-tax has to be deducted during the financial year 1970-71 from income chargeable under the head Salaries. These rates will be applicable to deduction of tax from salaries paid or payable on or after April 1, 1970. An extract from Paragraph A of Part III of the First Schedule to the Finance Bill, 1970, insofar as it relates to levy of income-tax on salaries is enclosed herewith [Annex I]. It is requested that pending the passing of the Finance Bill, 1970, deductions of tax from salaries may be made during the financial year 1970-71 according to the rates in the said Schedule. A couple of examples of calculation are given in Annex II. 2. The substance of the main provisions in the law insofar as they relate to income from sal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the assessment. However, in cases where contributions to the National Defence Fund, Jawaharlal Nehru Memorial Fund or the Prime Ministers Drought Relief Fund are made by deduction from the pay bills, 55 per cent of such contributions may be deducted in computing the taxable income of the employee. Care should be taken to see that the aggregate of such contributions for the year is not less than Rs. 250. Disbursing officers should show the total contributions in the remarks column of the return under section 206. (5) In cases where deductions are claimed on account of tax on professions, trades, callings or employments levied under any State or Provincial Act the same may be allowed from the total income for purposes of deduction of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the conveyance is registered in his own name.) The standard deduction of Rs. 30 per month is admissible to such of the salaried taxpayers who do not own any conveyance as also to those who own a bicycle or any other conveyance, not being a motor car, motor cycle, scooter or other moped. The deduction of the appropriate amount for expenditure should be allowed in calculating the tax to be deducted at source from the salary income. The standard deductions mentioned above will not be available to an employee who is in receipt of a conveyance allowance whether as such or as part of his salary. (8) In the case of an employee in receipt of a conveyance allowance, the disbursing officer may exclude from the salary of the employee tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... porated or not, or every artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2 of the Income-tax Act, not being a case to which any other Paragraph of this Part applies : Rates of income-tax (1) where the total income does not exceed Rs. 5,000 Nil; (2) where the total income exceeds Rs. 5,000 but does not exceed Rs. 10,000 10 per cent of the amount by which the total income exceeds Rs. 5,000; (3) where the total income exceeds Rs. 10,000 but does not exceed Rs. 15,000 Rs. 500 plus 17 per cent of the amount by which the total income exceeds Rs. 10,000; (4) where the total income exceeds Rs. 15,000 but does not exceed Rs. 20,000 R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome exceeds Rs. 2,00,000 : Provided that, for the purposes of this Paragraph in the case of Hindu undivided family which at any time during the previous year relevant to the assessment year commencing on April 1, 1971, satisfies either of the following two conditions, namely : (a) that it has at least two members entitled to claim partition who are not less than eighteen years of age, or (b) that it has at least two members entitled to claim partition who are not lineally descended one from the other and who are not lineally descended from any other living member of the family : (i) no income-tax shall be payable on a total income not exceeding Rs.7,000; (ii) where the total income exceeds Rs. 7,000 but does no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Salary income 28,088 Provident fund contributions 3,500 Life insurance premium 6,275 Profession tax payable 138 [The employee maintains a motor car registered in his own name and is likely to use it for 11 months for official purposes.] Rs. Total salary as above 28,088 Less Rs. - Profession tax 138 - Allowance for expenditure and wear and tear on account of maintenance of motor car at Rs. 200 p.m. for 11 months 2,200 2,338 25,750 Less : ..... X X X X Extracts X X X X X X X X Extracts X X X X
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