The amount arrived after adding income under five heads of Income, is termed as ______

Question

Question

This question was previously asked in

UP Police SI (दरोगा) Official PYP (Held On: 12 Nov 2021 Shift 2)

Answer 1

The correct answer is Gross Total Income.

Key Points

The Gross Total Income is the aggregate amount arrived at by adding income under all five heads of income.
The five heads of income as per the Income Tax Act, 1961 are:
- Salaries
- Income from house property
- Profits and gains of business or profession
- Capital gains
- Income from other sources
After computing the income under each head, they are summed up to arrive at the Gross Total Income.
The Gross Total Income is computed before applying any deductions under Chapter VI-A of the Income Tax Act.

Additional Information

Net Income
- Net Income is the income that remains after all expenses, taxes, and deductions have been subtracted from the total revenue or gross income.
- In the context of individual income taxation, it is often referred to as taxable income.
Actual Income
- Actual Income is not a specific term used in the context of income tax.
- It generally refers to the real income earned by an individual or entity but lacks a formal definition in tax laws.
Net Total Income
- Net Total Income is often used synonymously with taxable income.
- It is the income on which tax is actually levied after deductions and exemptions.