Skip to content

CS Professional · Advanced Direct Tax Laws and Practice · Computation of Total Income, Tax Liability and Filing of Return of Companies

Under section 352 of the Income-tax Act, 2025, how is accreted income computed before the reduction for specified assets?

Accreted income equals the aggregate fair market value of the specified person's total assets less its total liability, both on the specified date and valued by the prescribed method. It is then reduced by the amount attributable to specified assets and their related liabilities.

  1. AAggregate fair market value of total assets minus total liability on the specified dateCorrect
  2. BBook value of total assets minus total liability on the specified date
  3. CAggregate fair market value of total assets plus total liability on the specified date
  4. DTotal income of the tax year minus the exempt income of that year

Explanation

Section 352(2) gives A = B - C, where B is the aggregate fair market value of total assets and C is total liability, both on the specified date and valued by the prescribed method. Option B is wrong because it uses book value rather than fair market value. Section 352(3) then reduces the result by the amount attributable to specified assets and their related liabilities.

Did you get it right without looking?

One question tells you little. A timed set on Computation of Total Income, Tax Liability and Filing of Return of Companies shows your real accuracy, how long you take and where you lose marks.

Practise Computation of Total Income, Tax Liability and Filing of Return of CompaniesFree diagnostic mock

More Computation of Total Income, Tax Liability and Filing of Return of Companies questions