Gross Salary received by Mr. Pankaj, aged 42 years during the F.Y. 2024-25 from M/s PPN Limited is 37,50,000. House property loss declared by him…
CA Final · Direct Tax Laws and International Taxation · PYQS · September 2025
Gross Salary received by Mr. Pankaj, aged 42 years during the F.Y. 2024-25 from M/s PPN Limited is 37,50,000. House property loss declared by him for the financial year (along-with documentary evidence) is 2,00,000 in respect of his self-occupied property.60,000 is interest accrued on FDR with State Bank of India for F.Y. 2024-25 in respect of which TDS was deducted at applicable rate by the Bank. Mr. Pankaj purchased a Motor car of 32,00,000 on 01.12.2024 for personal purposes, TCS was separately charged on the purchase price of Motor Car at applicable rate. He has no other income. Mr. Pankaj has submitted relevant information to his employer M/s PPN Limited in prescribed form with supporting evidences. He also intimated his employer his intention to exercise the option to choose default tax regime for the financial year.
Suggested Answer and Working Notes:
M/s PPN Limited, being an employer has to deduct tax at source under section 192 from the salary of Mr. Pankaj at the time of payment by applying the average rate of income-tax computed at the rates provided in section 115BAC(1A), where an employee does not exercise an option to shift out of this tax regime. While computing the tax, the employer PPN Ltd. has to consider any other income chargeable to tax and any tax deducted at source and tax collected at source of Mr. Pankaj. Computation of tax liability of Mr. Pankaj under default tax regime Particulars ₹ Gross Salary 37,50,000 Less: Standard deduction under section 16(ia) 75,000 36,75,000 Interest in respect of self-occupied property [Not allowed under default tax regime] Nil 36,75,000 Interest on FDR 60,000 Total Income 37,35,000 Tax on 37,35,000 at slab rate [30% of 22,35,000 +1,40,000] 8,10,500 Add: HEC@4% 32,420 Tax liability 8,42,920 Less: TDS under section 194A @10% on interest on FDR of 60,000 6,000 TCS under section 206C(1F) @1% on motor car of 32lakhs 32,000 Tax liability 8,04,920 M/s PPN Limited has to deduct tax of 8,04,920.
Topics: Deduction, Collection and Recovery of Tax
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