A question on Income Tax in India. When all salarised class are recovered Income Tax from salary,how rich left?

from paying the Income Tax???
@@Kumar, I am asking about the richest like Industriliast, film personalites, etc. OK?
@@@Buzzzbe ::I am talking about richest people and not middle class business people like small estate owners, factory owners, etc. OK?

9 Replies to “A question on Income Tax in India. When all salarised class are recovered Income Tax from salary,how rich left?”

  1. all rich guys evade lot of taxes.there r so many loopholes in our taxlaws, only CAs can understand and help rich people to evade all sorts of tax.

  2. Sorry, but the framing of your question made me conclude that you enquire about if Salaried Individuals have their income taxes deductible from Salary how are thosw who are rich left from it…well they apparently aren’t…if you have a bank account and you have a some deposited in it, you will be taxed on it…those who do not deposit this money in the bank, and still work, are excised under the auditory board’s direction from their employers statistical data…
    those who earn a lot are also bought under this jurisdictory committees direction…those who still manage to evade taxes and launder money in large sums, discreetly, are by Law Criminals…you have to pay tax over your income…in general above one lakh fifty thousand…

  3. What do you mean by rich ?

    A rich man has more expenses and mostly run at a loss.
    We cannot say he is rich by his capitals and investments.

    salaried class has all their money for them.
    But the rich employ many and pay them salary.

  4. Oh! But you seem to entertain some wrong notions about the rich not paying tax.They most certainly do.However they have a battery of Chartered Accountants and legal luminaries working for them who delve deep into the various tax laws and find loopholes to avoid (mind you,not evade)
    paying high taxes.The payments to these experts are probably worth it for the rich guys.And maybe there are other ways too by which they get away with paying less tax.And that is one of the reasons that they are rich and stay rich.Have a Rich Day.

  5. Nobody above law of the land. Rich are also paying tax but drawback is that loophole in law and power the rich they enjoy to amend law according to their convenience from time to time. Hard truth is that 80% are law abiding people but they do not have power and they are divided.

  6. As per Income tax act, every one has to pay Income tax depending upon the Income they earn.

    In a few types of Incomes like Salaries, Tax is already deducted as Source (TDS), so the salaried employees feel the pain. Similarly, when one pays high amount of amount to any one, they need to deduct Tax and needs to pay. for Example, if you are paying a Rent of more than 10,000 a month of you Or paying an interest of more than 20,000 (not sure of the exact amount), you need to deduct the Tax and pay.

    Regarding the Rich, they may be paying Tax or may be evading tax using the loop holes present in the Income Tax act or not disclosing their income. There are a few sources from which TDS is not possible, like business where exact profit is not known and so TDS is not applicable.

  7. Well!!!!!!

    It is very simple……..

    The salaried people receive salary from a reliable valid source.

    All employers, including Govt. of India organizations, show the net salary given to their employees under the head “Expenses” (or DEDUTIONS) in their account. Thus, the liabilty of the money earned automatically gets transferred to the salaried.

    “Salary” is the remuneration received by or accruing periodically to an individual for service rendered as a result of expressed or implied contract.

    Payment can be taxed under this section unless the relationship of employer and employee exists between the payer and payee. The employer and employee relationship is the relationship of a master and servant, and it distinctly differs from that existing between a principal and agent

    Primarily, the degree of control of the employer over the employee would be a deciding factor, as the agent is generally not under the complete Control and supervision of his principal.

    That is why even the emoluments received by an Member if Parliament/ M.L.A. are not taxable under the head “Salary” because of the absence of employer and employee relationship.!!!!!

    But, for the rich people, they do not have (or may hide) a definite account for taxation. This makes them cleverly hide or show their profits to be lesser to escape from the Income tax burden!!

  8. Basically your question is not about Rich and salaries but your question is about Salaries and Self employed correct?

    but looking at your comment to Buzzbe, I see that you are talking about richest people that is like corporate heads etc?

    Lets first classify what are richest, CEO of Tata Group of Industries is one of richest person, and he is on salary, is he not? CEO of Reliance Industry is one of the richest person in India and he is also on salary, is he not? And to best of my understanding, from his salary also Tax is deducted at source.

    Then these individuals get shares from the organizations, that means they share any profit or loss earned by the company. And that is accountable and they have to declare it while filing their return.

    Please remember all of the corporate house are owned by share holders, audited, and any profit earned by share holders are taxable as per IT laws. Any person including Chairperson and CEO are employees of the company in turn share holder. Top executive salaries are declared in annual report of the company.

    Now coming to the self employed richest people, like top class entertainment industry players like Mr. Amitabh Bachchan, Mr. Rajanikanth, Mr. Shahrukh Khan etc, or big writers like Mr. Khushwant Singh. In past some irregularities have been found in this area, and some of our friends pointed out, some times some of these people take advantage of loop holes in the law and pay less taxes but cannot get away from paying taxes. IT department is mostly behind these people because they know that this is IT department’s weaker area. Look, I have given some names as example, but I am saying any of these are doing anything wrong, I have not seen any reports blaming any of these involved in tax frauds. So please don’t me wrong.

    In general everyone wants to take advantage of weaker areas of taxation laws and avoid taxes. May it rich or may it be poor. I see some in my company live with their parents and present rent receipt to get HRA benefits, some purchase medical bills to lessen the taxes.

    Another thing, you and I also help people in tax frauds, don’t we? Surprise surprise 🙂

    We go to shops, buy stuff and don’t take receipt or we don’t take proper receipts. We do this for various reasons. First, the shop is too small, they don’t have any billing system, second and the most interesting one, shop owner tells us, if you want receipt you will have to pay 2% receipt (most common in jewelery shops). What does it mean? Shopkeeper does not pay Sales tax/VAT, and he does not keep any account of that sale and profit earned on that sale. Thus shopkeeper does not pay any income tax on that sale. So am I right in saying that you and I encourage tax frauds. And let me tell you, this is not small, this is big. more than what goes to IT department, is stolen from IT department by doing this in the lack of awareness.

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