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How Do Tax Code Changes in September Affect You

17th February 2011
By Wilmer Irwin in Taxes
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First, select the Tax Item box. If this customer lives out of state or is otherwise non-taxable, select the Non Taxable sales tax item you established above. If the customer lives in-state or is otherwise taxable, select the Taxable sales tax item you established above.

If your tax code is wrong, you need to contact your Tax Office straight away so they can correct it. You can find the name of your Tax Office by visiting the HMRC website, referring to your payslip, looking on a 'PAYE Coding Notice' if you have one - this is a notice telling you what your tax code is. HM Revenue and Customs (HMRC) usually send it out in January or February each year and they may also send it to you at other times - for example, if you've started receiving a new source of income or a new company benefit, or if your entitlement to age-related or other allowances has changed.

Finance Minister released the draft of Direct Tax Code (DTC) for public discussions in August 2009. CBDT (Central Board of Direct Taxes) released the Revised DTC discussion paper in June 2010 for inviting further comments on the modified proposals in DTC. Direct Taxes Code 2009 expected to become effective from 1 April 2011, shall replace India's antiquated Income Tax Act, 1961, which is a major step in the direction of much awaited tax reforms in India and which aims to simplify the tax regime radically.

The other day when discussing this with a friend, and we noted that bureaucracy is out of control and the taxation regulations is a mess, but both will likely remain as such due to the politics involved, and he stated; "Nor would they simplify the Tax Rules and have only auditors at the IRS with a higher auditing rate than the current 1:10,000 or so."

Income under the head Capital Gains, that is, all the gains and losses arising from investments in listed stocks and units of equity linked mutual funds, will be treated as income from ordinary sources for all the taxpayers, Residents and Non-Residents alike, which will be taxed at the rates applicable to the individual taxpayers.

Professor Palmer walked into the room on the first day pushing a handcart. It was similar to the one I used to move a refrigerator the week before. Heavy duty sucker. He had some black binder-type books stacked on it that he was pushing. I swear -they were very tall- I remember somewhere between 4 and 5 feet.

The code makes proposal for advance price agreement between tax assessor and tax payers. If the taxpayer enters into this agreement with Board, the price shall be determined as per that agreement. This provision may bring in certainty and consistency in the transfer pricing provision with respect to the transactions covered in the agreement. We have to see how scheme is formulated in this regard and how the scheme is implemented on the ground.

For the tax filers making between $200,000 and $500,000 they saw an increase in their tax share more than the groups that earned over $500,000. This is the result of the Alternative Minimum Tax (AMT). It takes away many of the Bush tax cuts for filers in this income group. Given that tax filers earning above $500,000 already owe more under the regular income tax code, they do not fit into the AMT category.

In May of this year, thanks to the 2003 Tax Act, the amount was raised to $100,000. That means that you can buy one or more eligible vehicles and write-off the entire amount up to $100,000 on your 2003 tax return! This is all documented in Section 179 of the tax code. Prior to this, you could take advantage of writing off depreciation, but it had to be done over five years.
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