In each assessment year income tax is charged at the rates given by __________
Determining Income Tax Rates for Assessment Year
The rates at which income tax is charged in India for any given assessment year are specified by the **relevant Finance Act**. This is a crucial piece of legislation passed by the Parliament each year.
Why the Finance Act is Key
- Annual Legislation: The Finance Act is presented along with the Union Budget and contains proposals for the government's fiscal income. It legally enacts the tax rates and changes to tax laws for the financial year.
- Sets Specific Rates: It details the exact rates of income tax, surcharges, and cess applicable to individuals, HUFs, companies, firms, etc., for that particular assessment year.
Evaluating Other Options
- Notifications: While the Ministry of Finance issues notifications, these typically clarify existing provisions or implement minor changes based on the powers delegated by the Finance Act or other Acts. They do not set the primary annual tax rates.
- Circulars: Circulars issued under the Income Tax Act, 1961, provide guidance and clarification on the interpretation of tax laws. They are administrative in nature and do not prescribe the tax rates themselves.
- Income Tax Act, 1961: This Act provides the fundamental legal framework for income tax in India. However, it lays down the *structure* and *charging sections* but not the specific rates applicable for a particular year. The rates are updated annually via the Finance Act.
Therefore, the Finance Act is the definitive source for income tax rates applied in each assessment year.
Important Questions from Income-tax
Tax audit is compulsory in the case of a person carrying on profession and whose gross receipts exceeds which one of the following?
Which are the appropriate tax planning perspectives in case of shutdown or continued decision under the Income Tax Act, of 1961?
A. Business loss and unabsorbed depreciation can be carried forward and set off against profit and gain.
B. The loss-making company and profit-making company may merge to avail of the tax benefit
C. Tax benefit of deduction u/s 33 AB and 115 VT may be withdrawn and liable to tax for the year in which the business is discontinued.
D. The condition of section 80 IB / 80 IC of the Act, a deduction is allowed for such undertaking
E. If a person has more than one business, the loss-making business may not be discontinued.
Choose the most appropriate answer from the options given below:
Belated return u / s 139(4) can be filled at any time
Which of the following is NOT a change of the new Income Tax bill introduced in the Parliament during February 2025?
What is the basic difference in the aggregates at market price and factor cost?
