Mr. Ashok, aged 66 years, a resident individual furnishes the following particulars of income earned by him in India and Country N for the…

Computation of taxable total income and net tax liability of Mr. Ashok for A.Y.2024-25 under the default tax regime under section 115BAC Particulars Particulars ₹ Profits and Gains of Business or Profession Income from sole-proprietary concern in India 8,00,000 Business Income in Country 'N' 9,50,000 17,50,000 Less: Business loss of A.Y. 2020-21 in Country 'N' 50,000 17,00,000 Income from Other Sources Gift received from a friend in Country 'N' 65,000 Dividend in Country 'N' 1,40,000 2,05,000 Gross Total Income 19,05,000 Less: Deductions under Chapter VI-A [Not available under default tax regime] Nil Total Income 19,05,000 Tax liability on 19,05,000 Tax on total income [30% of 4,05,000 +1,50,000] 2,71,500 Add: Health and Education cess@4% 10,860 2,82,360 Less: Deduction u/s 91 (See Working Note below) 1,63,761 Net Tax Liability 1,18,599 Net Tax Liability (Rounded off) 1,18,600 Working Note: Calculation of deduction under section 91 Average Rate of tax in Country N Tax @10% on dividend income of 1,40,000 14,000 Tax @20% on other income of 10,15,000 (Business income of 9,50,000 and gift of 65,000) 2,03,000 Total Tax Liability in Country N 2,17,000 Average Rate of tax in Country N = 2,17,000/11,55,000 x 100 18.79% Indian Rate of tax = 2,82,360/19,05,000 x 100 14.82% Doubly taxed income from Country N Business income [9,50,000 - 50,000] 9,00,000 Gift from a friend of 65,000 65,000 Dividend Income 1,40,000 Doubly taxed income 11,05,000 Deduction u/s 91 = Lower of average rate of tax in Country N and Indian rate of tax rate of tax x Doubly taxed income = [14.82% x 11,05,000] 1,63,761