Question

On 30 June 2018 Jimmy prepaid the loan repayments for the next 12 months 1 July...

On 30 June 2018 Jimmy prepaid the loan repayments for the next 12 months 1 July 2018 to 30 June 2019           $18000

Will it be deductible under allowable deductions if we have to calculate taxable income for the year ended 30 June 2018? If No, what is the reason?

Homework Answers

Answer #1
  • First step is to calculate your gross salary by adding all taxable components of salary- Basic Pay, Dearness Allowance, HRA, Special & other allowances.
  • Once you get this amount, add the extra income of interests, rental on property, bonuses & income from other sources, if any.
  • Add capital gains from all assets- Equity or Debt instruments, Real Estate, Unlisted shares etc.
  • Deduct all exemptions- standard exemption of ₹50,000/- (available to all), HRA exemption, from your gross income.
  • Further subtract basic deductions under Section 80C, 80D or any other deductions that are applicable.
  • The income arrived is your Net Taxable Income.

No

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