Who Should Pay Income Tax?

Under the Income Tax Act 1961, income tax is payable by every assessee at the rates fixed by the Finance Act every year. An “Assessee” means a person by whom any tax or any other sum of money (i.e. penalty or interest) is payable under the Act. It includes:-

Every person in respect of whom any proceeding under this Act has been taken for the assessment of his income or of the income of any other person in respect of whom he is assessable, or of the loss sustained by him or by such other person, or of the amount of refund due to him or to such other person;

Every person who is deemed to be an assessee under any provision of this Act;

Every person who is deemed to be an assessee in default under any provision of this Act.

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The term “person” under the Act includes:-

An Individual

A Hindu Undivided Family(HUF)

A Company

A Firm

An Association of Persons (AOP) or a Body of Individuals (BOI), whether incorporated or not.

A Local Authority

Artificial Juridical persons

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