INCOME FROM BUSINESS OR PROFESSION

Business:

                    Business means any trade commerce, marketing, manufacturing process or commercial activity which deals with the sale and purchase of goods.
PROFESSION:
           Intellectual skill or manual labour controlled by intellectual ability is called professions.
TAXABILITY:
         If an assessee receives the income from business or profession it will be chargeable to tax under this head. Following are the important incomes which are chargeable tax to under this head.
a:  During the income year at any time profits and gains received by assessee from any business profession , will be taxable.
b:  Any benefit or perquisite arising from business or profession is also chargeable to tax.
c:  Income of trade professional association received from specific service which were performed , for its members is also chargeable to tax.
SCOPE OF BUSINESS OR PROFESSION:
                   Under the head of business or profession, following incomes are not taxable.
a:  If the old partner receives the share of good will from the new in coming partners it will be not taxable.
b:  Income of non_professional artist, writer is not taxable.
c:  Bar council enrollment and examination fee is not chargeable to tax.
DEDUCTIONS ADMISSIBLE:
                  Under the following deductions are admissible.
DEPRECIATION:
                 If any Building furniture or plant is used for the business purposes and its value depreciates such depreciation is allowable for deduction.
LOSS OF ANIMAL:
                If any animal is kept for business purposes and it dies or becomes disabling such loss is also allowable deduction.
INTEREST ON LOAN:
               If the loan is borrowed for the business purposes then interest paid on that loan will be allowable deduction.
RENT OF BUILDING:
               If building is used for the business purposes then its rent which is paid will be allowable deduction.
BONUS OR COMMISSION:
                Amount paid in the form of bonus or commission to the employees of the business, such amount is allowable deduction.
IRRECOVERABLE:
               The amount of bed debt which is actually written off  by the assessee will be decided by the income tax officer and it will be deductible.
PAYMENT TO MODARBA;
              The amount which is paid to a modarba or PTC holder for the borrowed funds purposes is deductible.