Explain the rules of the determination of basis period for the year of assessment when (a) Accounts prepared for less than or more than 12 months and not ending on 31st December (b) Basis period of a person other than a company under Section 21 of the Income Tax Act 1967
Explain the rules of the determination of basis period for the year of assessment when
(a) Accounts prepared for less than or more than 12 months and not ending on 31st December
(b) Basis period of a person other than a company under Section 21 of the Income Tax Act 1967
Please give explanation in details with example
The basis period is the period for which an individual, business, or entity's income is assessed for tax purposes. It is the accounting or financial period used to calculate taxable income.
The basis period serves as the reference timeframe for calculating taxable income and is critical for accurate tax assessment. It ensures that the income reported to tax authorities corresponds to the specific period in which the income was earned, received, or accrued.
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