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Taxation Managment

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Taxation Management ­ FIN 623
VU
MODULE 5
LESSON 5.20
EXERCISES ON RESIDENTIAL STATUS & TAXATION
Exercise 3: Determine Gross total income of Mr. A in the light of following particulars information
pertaining to tax year 2006.
Interest on Australian Bonds (one-third is received in Pakistan)
24,000
Income from agriculture in Australia, received there but later on remitted to Pakistan
50,000
Income from property in London received outside Pakistan
20,000
Income earned from business in London which is controlled through a PE in Pakistan
30,000
(Rs.10,000 is received in Pakistan)
Profit on sale of an asset in Pakistan but received in Sydney
5,000
Pension from Pakistan Government but received in Sydney
20,000
Find out gross total income of A, if he is: (i) resident in Pakistan and (ii) non­resident
Solution to Exercise 3:
Computation of Gross total income of Mr. A for tax year 2006
Particulars
Gross total income if
Gross total income
resident
if non-resident
a. Interest on bonds...
24,000
Nil
b. Agriculture Income in Australia
50,000
Nil
c. income from property...
20,000
Nil
d. income from business...
30,000
30,000
e. Profit on sale of asset...
5000
5000
f. Pension from Government of Pakistan in Sydney..
20,000
20,000
Total
149,000
55,000
Exercise 4: Determine Gross total income of Mr. A in the light of following particulars information
pertaining to tax year 2006.
a.
Profit on sale of plot at Sydney (One-half received in Pakistan)
250,000
b.
Profit on sale of plot at Tokyo (One-half received in London)
150,000
c.
Salary from a Pakistani company received in London. (One-half is paid for
350,000
rendering service in Pakistan)
d.
Interest on Australian Bonds (entire amount received in London)
100,000
e.
Income from property in Tokyo received there.
400,000
f.
Agricultural income in USA received in London but later on remitted to Pakistan.
100,000
Solution to Exercise 4:
Computation of Gross Total Income of Mr. A for tax year 2006
Particulars
Gross total income if
Gross total income
resident
if non-resident
a. Sale of plot....
250,000
Nil
b. Sale of plot....
150,000
Nil
c. Salary from Pakistani company...
350,000
175,000
d. Interest on Australian bond
140,000
Nil
e. Income from property in Tokyo
320,000
Nil
Rs 400,000 ­ 80,000
30
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Taxation Management ­ FIN 623
VU
(1/5th Subtracted as allowance for repairs
For tax year 2006)
f. Agricultural income in USA....
100,000
Nil
Total
1,310,000
175,000
31
Table of Contents:
  1. AN OVERVIEW OF TAXATION
  2. What is Fiscal Policy, Canons of Taxation
  3. Type of Taxes, Taxation Management
  4. BASIC FEATURES OF INCOME TAX
  5. STATUTORY DEFINITIONS
  6. IMPORTANT DEFINITIONS
  7. DETERMINATION OF LEGAL STATUS OF A PERSON
  8. HEADS OF INCOME
  9. Rules to Prevent Double Derivation of Income and Double Deductions
  10. Agricultural Income
  11. Computation of Income, partly Agricultural,
  12. Foreign Government Officials
  13. Exemptions and Tax Concessions
  14. RESIDENTIAL STATUS & TAXATION 1
  15. RESIDENTIAL STATUS & TAXATION 2
  16. Important Points Regarding Income
  17. Geographical Source of Income
  18. Taxation of Foreign-Source Income of Residents
  19. Exercises on Determination of Income 1
  20. Exercises on Determination of Income 2
  21. SALARY AND ITS COMPUTATION
  22. Definition of Salary
  23. Significant points regarding Salary
  24. Tax credits on Charitable Donations
  25. Investment in Shares
  26. SALARY AND ITS COMPUTATION EXERCISES 1
  27. SALARY AND ITS COMPUTATION EXERCISES 2
  28. SALARY AND ITS COMPUTATION EXERCISES 3
  29. Tax treatment of Gratuity
  30. Gratuity Exercise
  31. PROVIDENT FUND
  32. Exemptions on Business income, Treatment of Speculation Business
  33. Deductions Allowed & Not Allowed
  34. Deductions: Special Provisions, Depreciation
  35. Methods of Accounting
  36. Taxation of Resident Company
  37. Taxation of Companies: Exercises
  38. Computation of Capital Gain
  39. Disposals Not Chargeable To Tax
  40. TAX RETURNS & ASSESSMENT OF INCOME UNIVERSAL SELF ASSESSMENT SCHEME
  41. Normal Assessment, USAS, Provisional Assessment, Best Judgment Assessment
  42. ADVANCE TAX COLLECTION & RECOVERY OF TAX PENALTIES & PROSECUTION
  43. What is Value Added Tax (VAT)?
  44. SALES TAX
  45. SALES TAX RETURNS