Meaning of Business and Profession
Business simply means any economic activity carried on for earning profits. According to Sec 2(3) business is “any trade, commerce, manufacture or any adventure in the nature of trade commerce and manufacture”. Any transaction with a motive of selling at profits included under this concept. It is not necessary that there should be a series of transaction in a business and it should be carried on permanently.
Profession is an occupation requiring purely intellectual skills or manual skills controlled by the intellectual skill of the operator. e.g. Lawyer, doctor, engineer etc. So profession refers to those activities where the livelihood is earned by the persons through their intellectual or manual skill.
The following income shall be chargeable to income-tax under the head Profits and gains of business or profession,
1) The profits and gains of any business or profession which was carried on by the assessee at any time during the previous year
2) Any compensation or other payment due to or received by any person in connection with a business or profession
3) Income derived by a trade, professional or similar association from specific services performed for its members
4) Profits on sale of a license granted under the Imports (Control) Order, 1955, made under the Imports and Exports (Control) Act, 1947 (18 of 1947) ;]
5) Cash assistance (by whatever name called) received or receivable by any person against exports under any scheme of the Government of India ;]
6) Any duty of customs or excise re-paid or re-payable as drawback to any person against exports under the Customs and Central Excise Duties Drawback Rules, 1971 ;]
7) Value of any benefit or perquisite, whether convertible into money or not, arising from business or the exercise of a profession;
8) Any interest, salary, bonus, commission or remuneration, by whatever name called, due to, or received by, a partner of a firm from such firm:
9) Any sum received under a Key man insurance policy including the sum allocated by way of bonus on such policy.… Read More »