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Frequently Asked Questions on Income Tax
What is PAN (Permanent Account Number)?
It's an alphanumeric code of 10 characters given by the Income Tax Department by which it can identify any Income Tax assessee. This number is a permanent number, which does not undergo any change with the change of your address or station. PAN under the new series is being issued to replace the old PAN or GIR No (General Index Register Number).
Who should apply for PAN?
You will require a PAN if you are an Income Tax payer, or if you are carrying on a business or profession wherein your total sales/turnover/gross receipts exceed Rs. 5 lacs or in case of Trust. (Any one who comes under the definition of 'person' as defined by Income Tax Act are expected to apply for PAN.)
When to apply for PAN?
Income of a particular financial year is taxed in the subsequent year, i.e., the assessment year. One is required to apply for PAN by the 30the June of the relevant assessment year.
How is tax to be paid?
One can pay tax through a cheque, draft, or cash. You also need to fill in the appropriate challan along with the payment to the bank authorized to collect the same.
Is there a maximum amount, which is not chargeable to Income Tax?
The maximum amount not chargeable to Income Tax (except in case of co-operative societies, firms, local bodies and companies wherein the tax is chargeable on the whole of the income), for the A.Y 1999-2000 is Rs. 50000/-.
What is agricultural income and is not agricultural income exempt from tax?
Agricultural income means income from land derived by doing agricultural operations and this is the primary criteria determining, whether the income derived from land is agricultural income or not. Even the income derived from a farmhouse, which is situated on or near the agricultural land; rent from agricultural land, is considered to be agricultural income. Agricultural Income is not subject to tax, but a gain on sale of agricultural land is not agricultural income and so taxable as capital gains.
What are the due dates for filing of returns?
(i) If the assessee is a company, then returns have to be filed on 30th November of the A.Y.
(ii) In case of assesses other than company
If the accounts are required to be audited, the 31st of October of A.Y.
If the total income includes any income from business or profession and where the accounts are not required to be audited, the 31st of August of A.Y.
In any other case the 30th June of A.Y.
What are the rates of income tax?
| Income | Rates |
| Less than Rs.50000 | Nil |
| Rs 50,000 to Rs.60,000 | 10% of the amount by which the income is more than Rs.50,000 |
| Less than Rs.60,000 to Rs.1,50,000 | 1000 + 20% of the amount by which the income is more than Rs.60,000 |
| Rs. 1,50,000 and above | 19,000 + 30% of the amount by which the income is more than Rs.1,50,000 |
| Salary income before giving standard deduction(i.e., after giving deduction in respect of entertainment allowance and professional tax) | Amount of standard deduction |
| For salary upto Rs. 1.5 Lakh | 1/3 of gross salary or Rs.30,000 whichever is less |
| For salary more than Rs. 1.5 lakh and less than Rs. 3 lakh | Rs. 25,000 |
| For salary more than Rs. 3 lakh and less than Rs. 5 lakh | Rs. 20,000 |
| For salary more than Rs. 5 lakh | NIL |
SURCHARGE for assessment year 2003-2004 : 5 per cent of income-tax if net income exceeds Rs. 60,000.
| Income | Rates |
| Less than Rs.50000 | Nil |
| Rs 50,000 to Rs.60,000 | 10% of the amount by which the income is more than Rs.50,000 |
| Less than Rs.60,000 to Rs.1,50,000 | 1000 + 20% of the amount by which the income is more than Rs.60,000 |
| Rs. 1,50,000 and above | 19,000 + 30% of the amount by which the income is more than Rs.1,50,000 |
| Salary income before giving standard deduction(i.e., after giving deduction in respect of entertainment allowance and professional tax) | Amount of standard deduction |
| For salary upto Rs. 1.5 Lakh | 1/3 of gross salary or Rs.30,000 whichever is less |
| For salary more than Rs. 1.5 lakh and less than Rs. 3 lakh | Rs. 25,000 |
| For salary more than Rs. 3 lakh and less than Rs. 5 lakh | Rs. 20,000 |
| For salary more than Rs. 5 lakh | NIL |
SURCHARGE for assessment year 2002-2003 : 2 per cent of income-tax if net income exceeds Rs. 60,000.
| Income | Rates |
| Less than Rs.50000 | Nil |
| Rs 50,000 to Rs.60,000 | 10% of the amount by which the income is more than Rs.50,000 |
| Less than Rs.60,000 to Rs.1,50,000 | 1000 + 20% of the amount by which the income is more than Rs.60,000 |
| Rs. 1,50,000 and above | 19,000 + 30% of the amount by which the income is more than Rs.1,50,000 |
| Salary income before giving standard deduction(i.e., after giving deduction in respect of entertainment allowance and professional tax) | Amount of standard deduction |
| For salary upto Rs. 1 lakh | 1/3 of gross salary or Rs.25,000 whichever is less |
| For salary more than Rs. 1 lakh & less than Rs. 5 lakh | Rs. 20,000 |
| For salary more than Rs. 5 lakh | NIL |
SURCHARGE for assessment year 2001-2002
Net Income Rate of Surcharge
(as a % of income-tax)If net income does not exceed Rs.60,000 Nil If net income exceeds Rs.60,000 but does not exceed Rs. 1,50,000 12% If net income exceeds Rs. 1,50,000 17%
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