Topic:How to Study CA Final Direct Tax Laws DT in 60 days ?
AnonymousPosted on 8th January,2021 05:15 PM
How to score 60+ in Direct Tax Laws\r\n60 days Study Planner\r\n \r\nThe syllabus is divided into 2 parts\r\nDirect Tax Laws
International taxation
\r\nAs we all know, direct tax revolves around 5 heads of income. But for C.A. Final exams only 3 heads are to be given most priority while studying:\r\nCapital gains
Income from Other sources
Profit and gains from business and profession
\r\nNote: Students of NEW Course are advised to please prepare yourself thoroughly for 30 Marks of MCQ since ICAI is expected to test most of the technical concepts through the same.\r\nTopics\r\nWhat are the important sections and provisions?\r\nFocus area?\r\nHow to prepare?\r\nWhat does ICAI expect?\r\n
\r\n \r\n \r\n \r\nIncome from capital gains and black money(Gift taxation)
-: 8-10 Marks\r\n1) Sections of black money i.e. Section 56(2)(viib)/(viii)/(ix)/(x) and section 50C,50 CA and Section 47, 47A read with section 55,154,155,2(42A) and Section 49 and Rule 11UA and 11UAA .\r\nLogic behind such sections and link it with Section 47 , 50C and 50CA as it leads to an intended double taxation by Finance minister due to section 56(2)(x).\r\nJust go through the sections along with the logics and focus on applicability and exceptions of section.\r\nThere are various amendments by Finance Act 2017 as well as 2018 in this chapter thus ICAI expects us to be well worth with those.\r\n \r\n \r\n \r\n \r\n \r\n \r\n2)`Exception of Section 45(1) i.e. 45(1A)/(2)/(3)/(4)/(5)/(5A) \r\nJoint developments agreements Section 45(5A) read with TDS section 194IC\r\nThe go through the sections and focus on when the tax liability arises in these sections.\r\nAmendments\r\n \r\n \r\n \r\n \r\n \r\n \r\n3) Section 112,112A and 111A read with 10(38), 2(42A) and 55(2)(ac)\r\nFocus on Section 112A
Note: Sale of Long term capital assets of 10(38) till 31.3.2018 are still eligible for exemption.\r\nLogical study of section 112A and FMV calculation u/s 55(2)(ac) is Very important of exams.\r\nAmendments in 112A and 55(2)(ac).\r\n \r\n \r\n \r\n \r\n \r\n \r\n4) Deemed dividend related sections\r\nSection 115BBDA,115 BBD,115-O,Section 2(22)(a)/(b)/
(c)/(d)/(e),10(34),10(34A),10(35),115R-Mutual funds read with interest and penalties of section 115P,115Q,115S,115T for delayed payment of CDT and other provisions and section 46,115QA Rule 40BB and Sec 46A to be read as a group linked with Sec 2(22)(c) and (d).\r\nLinkage of sections and Section 2(22)(e) amended to include CDT to be paid by Company and exempt in hands of shareholder\r\nAmendments in section 2(22) and 115-O.\r\n \r\n \r\n \r\n \r\n \r\n \r\n5) Section 10 Exemptions and section 48 provisos\r\nSection 10(38) and remember, 3rd Proviso to sec 48 says that where 112A applies , no indexation shall be available.\r\nJust focus on the applicability of exemptions and whom are they applicable to and in what cases.Do not cram it , just understand the concept behind it.\r\nApplicability in various cases.\r\n \r\n \r\n \r\n \r\n \r\n \r\n6) Other Provisions: Section 54 deductions , clubbing and slum sale.\r\nNot much important for CA Final exams but just read twice\r\nChange in Section 54EC\r\nA few adjustments may be asked but not a full fledged question.\r\n \r\n \r\n \r\n \r\n \r\nProfit and gains from business and profession
16 -20 M\r\n1) Disallowances and allowances i.e. Section 30 to 40A and related case laws\r\nA 16 Marks P/L based question is surely expected thus a clear understanding of calculation of business income is expected\r\nDo a few questions by hand and focus on speed.\r\nRevise the disallowances regularly and logically\r\nA full fledged question is surely asked.\r\n \r\n \r\n \r\n \r\n \r\n \r\n2) Depreciation section 32 and 43 read with section 50.\r\nDepreciation rates and calculation as well as relevant case laws must be thorough\r\nFocus on the 13 Explanations for actual cost under section 43(1).\r\nAn adjustment in a full question is only expected but that adjustment is worth 4 marks\r\n \r\n \r\n \r\n \r\n \r\n \r\n3) Deduction of Section 35AD,33ABA, 35D,35DD,35DDA,35ABB,35ABA,35CCD,35CCC and donation section 35 series.\r\nJust read the same a few times and focus on applicability of the same.\r\nRevise it a few times but don't cram it.\r\nApplicability of the section in various cases.\r\n \r\n \r\n \r\n \r\n \r\n \r\n4) Section 40B read with sec 172,40BB,40BBB,40BBA ,read with section 115A\r\nThese are related to non-resident and must be read together.\r\nThese are a bit similar thus a focus must be made to the "RATE" at which the income is deemed to be business or profession.\r\nRevise it a few times but don't cram it.\r\nSince focus of ICAI is towards international taxation, thus these sections become very important.\r\n \r\n \r\n \r\n \r\n \r\n \r\n5) Section 41,43A,43B and 43C read with relevant sections 36 and 40A\r\nMost important are sections 40A and 40B\r\nJust a few times revision would be sufficient.\r\nNo need to cram\r\nMemory of students for conditions in which these sections are applied.\r\n \r\n \r\n \r\n \r\n \r\n \r\n6) TDS and TCS sections read with section 234E and 271H and Section 220/221 as well as section 201 related to interest/Fee/penalties of TDS and TCS as well as Section 200A and 206C related to procedure of CASS software of processing of returns of TDS and TCS.\r\nFocus is expected on:
i) Rate of TDS/TCS
ii) Threshold limit
iii) The Exceptions to the sections
iv) The amendments and other procedural sections.\r\nFocus on applicability of sections and where individual are required to deduct and where not and where it is only resident and where it is not.\r\nLogical understanding of sections and amendments of finance act 2017 and 2018.\r\n \r\n \r\n \r\n \r\n \r\n \r\n7) Set off and Carry forward.\r\nJust read it a few times\r\nJust read it a few times\r\nConcept clarity.\r\n \r\n \r\n \r\n \r\n \r\nIncome Under head House property and Salary
4-6 Marks\r\nJust focus on latest amendments for these head. A full-fledged question is not asked but only a few adjustments here and there are expected.\r\nJust focus on amendments\r\nAmendments of finance act 2017 and 2018 and latest case laws related to the same.\r\n
\r\n \r\n \r\n \r\nTaxation of Specific entities.
:16-20 Marks\r\n1) Charitable trust along with definition u/s 2(15) and section 115BBC
2) AOP/BIO
3) Firms taxation read with section 187,188,189 and 188A for liability of partners.
4) Mutuality Concept
5) HUF
6) Political parties
7) Electoral trust
8) Securitization trust
9) Investment fund
10) Business Trust\r\n1) The latest amendments in the chapter of Charitable trust must be focused on for around 4- 8 marks
2) A full-fledged question of 8 marks from Taxation of Firms is also expected.
3) Business Trust is a new concept and expected to be asked in exams.\r\nSince these are very important for exams, a thorough understanding of the same is required and practice solving at least 3 questions of different types from each of the specific entity is must.\r\nA full-fledged question is asked on few of the type of specific entities.\r\n
\r\n \r\n \r\n \r\nMAT,AMT and Deduction of chapter VIA and 10AA.
: 8-12 Marks\r\nSection 115JB and other section from 80 IA to 80 RRB and related procedural section which are relevant and applicable for the relevant assessment year.\r\nJust focus on the rate of deduction and condition for eligibility of deduction to the assessee.
NOTE: Where Section 35 AD is not available due to applicability of AMT, the depreciation along with additional depreciation will be given to the assessee\r\nJust practice few full-fledged questions.\r\nAdjustments of MAT are expected to be known and focus on adjustments.\r\n
\r\n \r\n \r\n \r\nReturns, Assessments, Appeal and rectification and interest & penalties.
12-16 Marks\r\n1) Section 139 to section 153A related to returns and Assessment procedures.
2) Section 131 to Section 133D related to survey, investigation etc.
3) Other section related to appeal and rectification and revision by commissioner etc.
4) Other Procedural aspects i.e. 140A and interest and Fee 234F and 271A along with Interests of 234 A/B/C etc.\r\n(NOTE: Fee of section 234F and E are also an allowable deduction while calculation of PGBP income.)
1) Amendments must be focused on
2) Case laws related to these provisions are very important and expected to fetch around 12 Marks.
3) Pay attention where the Doctrine of Partial Merger and where Total Merger is applicable.\r\nJust go through the sections and related case laws.\r\n2-3 times reading is enough.\r\nTry making summaries of the concept for faster revision as content is huge.\r\nLatest case laws and calculation of Taxable income to be returned along with provision of Re-assessment of section 147 etc.\r\n
\r\n \r\n \r\n \r\nInternational taxation
: 30 Marks\r\n1) Residential status
2) POEM
3) IFSC related amendments and sections.
4) Transfer pricing and DTAA .
5) Other Non-resident related concepts in 5 heads of income.\r\n1) Focus on Non-resident related section and amendments in Chapter of Capital gains.
2) Transfer Pricing & related issues.
3) POEM and residential status was not asked in previous attempts thus becomes more important for may/June 2019 attempt.\r\nSolve questions paper of Nov 2018 and before that,\r\nrelated to
non-resident.\r\n1) IFSC related amendments in chapter of capital gains
2) Concept clarity of Transfer pricing and DTAA.
3)Amendments of finance act 2017 and 2018.\r\n \r\n \r\n
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