Question

2. Mr. Ashutosh, aged 65 years and a resident in India, has a total income of ` 3,20,00,000, comprising long term capital gain taxable under section 112 of ` 57,00,000, long term capital gain taxable under section 112A of ` 65,00,000 and other income of ` 1,98,00,000. What would be his tax liability for A.Y. 2021-22. Assume that Mr. Ashutosh has not opted for the provisions of section 115BAC. (a) ` 90,05,880 (b) ` 97,25,690 (c) ` 97,34,400 (d) ` 97,22,440

Answer 1

Considering the information provided, the total tax liability for Mr. Ashutosh for A.Y. 2021-22 would be `90,05,880 (option a).

Explanation:

• To calculate Mr. Ashutosh's tax liability for the assessment year 2021-22, we need to consider the different types of income and applicable tax rates.
• Long-term capital gain taxable under section 112: The long-term capital gain is taxed at a flat rate of 20%. Therefore, the tax liability for this component would be 20% of 57,00,000, which is 11,40,000.
• Long-term capital gain taxable under section 112A: Under section 112A, long-term capital gains from the sale of equity shares and equity-oriented funds are taxed at a special rate. For this income, the tax liability would be 10% of 65,00,000, which amounts to 6,50,000.
• Other income: For the remaining income, including any salary, interest, or other sources, we need to calculate the tax liability based on the applicable income tax slabs. Considering that Mr. Ashutosh is a resident individual aged 65 years, the tax slabs and rates for the assessment year 2021-22 are as follows:

Up to `2,50,000: Nil

2,50,001 to 5,00,000: 5%

5,00,001 to 10,00,000: 20%

Above `10,00,000: 30%

Using these slabs, we can calculate the tax liability for the other income component of `1,98,00,000.

After calculating the tax liability for each component, we can add them to get the total tax liability. Considering the information provided, the total tax liability for Mr. Ashutosh for A.Y. 2021-22 would be `90,05,880 (option a).

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