) Ms. Mohini, a non-resident, aged 61 years, in the previous year 2018-19, earned Rs. 3,50,000 from processing of agricultural produce in India. She earned USD 5,000 (1 USD=72) from agricultural land in Australia. Her non-agricultural income in India was Rs. 7,50,000 and outside India was Rs. 60,00,000 (estimated). She has contributed USD 1,000 in PM Relief Fund in Australia and Rs 70,000 (via Bank NEFT transfer) to the ‘International Society for Krishna Consciousness’ (eligible u/s 80G) in India. Compute her total taxable income in India for the A.Y. 2019-20.
Answers
Given:
Earned from the processing of agricultural produce = Rs 3,50,000
USD = 5,000 (1 USD = 72)
Non agricultural income = Rs 7,50,000
And, the outside india = Rs 60,00,000
Contributed in PM Relief Fund in Australia = USD 1,000
Via Bank NEFT transfer = Rs 70,000
To find:
Total taxable income in India
Solution:
As we know that agricultural income arises from India is exempted u/s 10(1) while from Australia, it will be assumed that it is received outside India
Therefore that agricultural income will not be taxable as she is non resident
Now income received outside india i.e Rs 60,00,000 is not be taxable
The rest of the income i.e Rs 7,50,000 will be considered as a gross taxable income
But according to the question, on this income the deduction u/s 80G is allowed
Therefore the deduction of 72,000 will be fully allowed
But for the Rs 70,000 we need to check the qualifying limit
As we know that
Rs 7,50,000 would be considered as adjusted total gross income
And 10% of adjusted total gross income or the donation amount whichever is lower will be allowed as a deduction u/s 80G
So,
10% of Rs 7,50,000 = Rs 75,000
And,
donation amount = Rs 70,000
Therefore according to the provision 50% of Rs 70,000 i.e Rs 35,000 will be allowed as deduction.
So, the total taxable income is
= Rs 750,000 - 72,000 - 35,000
= Rs 643,000
Hence, her total taxable income in India is Rs 643,000
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