Question

Mr. A is resident but not ordinarily resident in India, age 62 years, earned a net
agricultural income of Rs. 4,00,000 during the previous year 2019-20. Compute his tax
liability assuming that he has non-agricultural income of Rs. 8,50,000 and he contributes
Rs. 90,000 towards Public Provident Fund.

Answer 1

Answer:

How to Calculate Tax on Agricultural income

Agricultural income is exempt from Income Tax under section 10(1) of the Income Tax Act, 1961. However, its included, for rate purposes, in computing the Income Tax Liability if following two conditions are cumulatively satisfied: Net Agricultural income exceeds INR 5,000/- for P.Y. 2014-15, and Total income, excluding net Agricultural income, exceeds INR 2,50,000/-.Taxability of Agricultural income

Agricultural income is exempt from Income Tax under section 10(1) of the Income Tax Act, 1961. However, its included, for rate purposes, in computing the Income Tax Liability if following two conditions are cumulatively satisfied:Total income, excluding net Agricultural income, exceeds INR 2,50,000/-.

Kindly note that the aforementioned condition at Serial No.2 shall change to INR 3,00,000/- in case if the Assessee is an individual who falls in the age bracket of 60 to 79 Years during the P.Y. 2019-20, and to INR 5,00,000/- in case if the Assessee is an individual who is of the age of 80 Years or more during the P.Y. 2019-20.