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Home » Business » Career » Diploma in Taxation covers various aspects of Income Tax Training

Ritu Vashist
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Diploma in Taxation covers various aspects of Income Tax Training

Submitted by Ritu Vashist
Sat, 17 Aug 2013

Anyone looking for Income tax course can opt for Diploma in Taxation from any reputed Accounting Institute, there are many institutes which offers such taxation courses, during such diploma courses in Income tax emphasis is laid down on various aspects of Income Tax few of such topics are discussed below:-
Concept of Income under Income Tax Act

Income tax is the tax levied on income. The tax payer has to pay on what he gets or he earns or he receives. It is not necessary that every receipt be treated as income. In this connection income is divided into two categories.

Revenue receipt and Capital receipt.

It is first essential to distinguish these two concepts. Let us see how

You get Source of Income
Salary from Services
Rent from Property
Profit from Business
Interest from Loans
Royalty from Knowledge
For every revenue receipt there exists a source of income. That source of income may be tangible asset or intangible assets. 'Similarly rent are generated by letting out a house property (source of income), and therefore same can be said for, salary, interest etc. All these receipts have source of income.

Receipts for which there does not exist a source of income is a, capital receipt. i.e. receipts arising by sale of source of income can be said to be capital receipt. E.g. sale of trees along with its roots or sale of property they are all termed as capital receipt.

Whereas every capital receipt is not taxable unless otherwise expressly taxable. Certain capital receipts which are not taxable but have been made taxable. e.g. Sale of capital asset being capital receipt but still chargeable to tax u/s 45

Similarly gifts received from father etc. is treated as capital receipt, therefore not taxable.

Generally any expenditure incurred in earning income is allowed as deduction. i.e. revenue expenditure is allowed as deduction from revenue receipts if such revenue expenditure is incurred in earning such revenue receipts.
Assessment Year

Assessment year may be defined as a year in which the income tax of the previous year is to be assessed. It is a period of twelve months starting from April I of every year and ending on March 31 of the next year. For instance, the assessment year 2013 2014 commenced on 1st April, 2012 and will end on March 31,2013.

Previous year

Income of the previous year is taxed in the immediately following assessment year. For instance, income earned during the previous year 2012 2013 is taxable in the immediately following assessment year i.e. 2013 2014.


Assessee means a person by whom any tax or any other sum of money (i.e. Penalty or interest) is payable under the Act:


The term person includes:

An individual
Hindu Undivided Family ( HUF)
An association of person
Body of individuals(AOP/ BOI)
Local authority,

Residential Status: -

The residential status of an assessee determines the extent of his global income taxable in India. Therefore it follows that taxable income of an assessee cannot be determined unless residential status is determined.

The residential status is determined solely on the basis of physical presence of the assessee in India and it is computed separately for each Previous Year Hence a person may be resident for one Previous Year and Non resident in the next year.
If a person is in India for

Basic Conditions

182 days or more during the Previous Year; or

60 days or more during the Previous Year and 365 days or more during the 4 years immediately preceding the Previous Year

Additional Conditions:-

He has been resident in India in at least 2 years out of 10 years.
He has been in India for 730 days or more during past 7 years.


Resident & Ordinarily Resident in India (One main & Two Additional)


Resident & Not Ordinarily Resident in India (One main only)


Non Resident in India (None of main Conditions)
Diploma in Accounting


Author is working with IPA offering professional courses and after 12th

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