Mohan, a resident individual aged 46 years, received the following incomes during the FY 25-26: Income from house property in Chennai (as computed…

Computation of total income and tax liability of resident Mohan for the A.Y. 2026-27 (as per the optional tax regime) Particulars ₹ ₹ Income from House Property Income from house property in Chennai (Computed) 4,30,000 Less: Loss from house property in Country Z 1,30,000 3,00,000 Profits and Gains of Business or Profession Royalty from Country X [Taxable in the source state only, hence, not considered] - Income from Other Sources Interest (other than interest on securities) from Country Y (USD 10,000 x 80, being the TTBR as on 31.3.2026) 8,00,000 Agricultural income in Country Z 2,00,000 10,00,000 Gross Total Income/ Total Income 13,00,000 Tax liability on 13,00,000 Tax on total income [30% of 3,00,000 +1,12,500] 2,02,500 Add: Health and Education cess@4% 8,100 2,10,600 Less: Foreign tax credit (See Working Note below) 78,000 Net tax liability 1,32,600 Working Note: Calculation of Foreign tax credit Indian Average Rate of tax = 2,10,600/ 13,00,000 x 100 = 16.20% Doubly taxed income pertaining to Country Z = Nil Foreign tax credit Nil Doubly taxed income pertaining to Country Y = 8,00,000 Tax paid in India in respect of interest (other than interest on securities) [8 lakhs x 16.20%] 1,29,600 Tax paid in Country Y in respect of royalty [USD 1,000 x 78, being the TTBR on 31.1.2026] 78,000 Foreign tax credit = Lower of tax paid in India and Country Y 78,000