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NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Concepts in Taxation

Caselet: Ms. Kavita Rao, a resident individual aged 35, earns the following for the year: salary (taxable) Rs 12,00,000; house property loss (self-occupied, interest on housing loan) Rs 1,50,000; interest on savings account Rs 20,000. Assume inter-head set-off of house property loss is permitted up to Rs 2,00,000 under the old regime and no other income or deduction applies. What is her gross total income?

Her gross total income is Rs 10,70,000. Salary of Rs 12,00,000 plus savings interest of Rs 20,000 gives Rs 12,20,000, and the house property loss of Rs 1,50,000 is set off against it, being within the Rs 2,00,000 limit.

  1. ARs 10,70,000Correct
  2. BRs 13,70,000
  3. CRs 12,20,000
  4. DRs 10,50,000

Explanation

Salary 12,00,000 plus other sources 20,000 = 12,20,000. The house property loss of 1,50,000 is within the 2,00,000 set-off limit, so it is deducted fully: 12,20,000 - 1,50,000 = 10,70,000. Adding the loss gives 13,70,000 (wrong sign); ignoring the interest gives 10,50,000; ignoring the loss gives 12,20,000.

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