Gross Income from Business
Section 24(1)
Where a debt owing in respect of
a) any stock in trade sold
b) any services rendered
c) the use or enjoyment of any property
the amount of the debt shall be treated as gross income.
Comment
This section use accrual concept is in comparable with the accounting principle.
Section 24(2)
The market value of any stock in trade which has been taken for private purposes without payment or any stock withdrawn from business for gifts or donation other than disposal.
Comment
A furniture trader give a compliment furniture sofa set to his relative for wedding gift. A sum equal to the market value of the furniture set will be added back to gross income for tax purpose.
Section 24(5)
Interest income of an investment dealing business or a money lending business.
Section 30(1)
Recovery of a bad debt which has previously been allowed as a deduction in ascertaining the adjusted income.
Section 30(4)
Waiver of debts by creditors which pertaining to any amount of expenditure previously allowed as a deduction in ascertaining the adjusted income.
Comment
Any purchases from trade creditor will reduce the gross income, therefore any debts written off by the creditor should be added back to increase the gross income for tax purpose.
