Income Tax Law and Practice Quiz for BBA-III Semester

Assessment Year

• The year in which income of an individual is assessed and taxed.
• For example, the income earned in the financial year 2022-23 will get assessed in the assessment year 2023-24.

Income Tax Act, 1961

• The comprehensive statute that governs taxation in India.
• Dictates how income is calculated, taxed, and collected.

Direct Tax

• Tax imposed directly on individuals or entities.
• Examples include Income Tax and Corporation Tax.
• The taxpayer bears the ultimate burden of the tax.

Exempt Income

• Income that is not included in the total income for tax purposes.
• It is excluded from the tax calculation due to specific provisions in the Income Tax Act, 1961.
• For example, agricultural income.

Income from Business or Profession

• Income from a business or profession.
• This type of income includes salaries, wages, and income from an occupation.

Financial Year

• The year in which income is earned.
• In India, it runs from April 1st to March 31st.

Indirect Tax

• A tax imposed on goods and services.
• It's typically paid by a consumer who ultimately bears the burden.
• Examples include GST (Goods and Services Tax) and Excise Duty.

Income Tax Act, 1961

• Focuses on the levy, collection, and administration of direct taxes in India.
• It classifies various types of incomes, defines exemptions and deductions, and outlines the rules for taxation.

Exempt Income

• Not included in the total income for tax purposes.
• It is not subject to tax.
• Examples include income from certain agricultural activities.

Previous Year

• The year in which income is earned.
• Income earned in the Previous Year is taxed in the subsequent Assessment Year.