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We know that Profit or loss is calculated as follows

PROFIT 

ParticularsAmt
Income100000
Less 
Expenses60000
Profit40000

 LOSS 

ParticularsAmt
Income100000
Less 
Expenses110000
Loss-10000

This profit/loss is taxable under PGBP Income

PGBP Income means "Profits and Gains of Business or Profession"

Hence, It includes profits and loss of

  1. Any Business(Any shop/factory etc)
  2. Any profession(Service sector like Doctor/Advocate etc)

 

How to Compute

We need to study both Income and Expenses to understand PGBP Income.

Incomes
All types of Business Incomes are Covered under PGBP Income
Certain other incomes are also taxed as PGBP which we will learn in Section 28 later.

 Expenses

Expenses are Covered from Section 29-43B

 

ParticularsAmtSections to be studied
IncomexxAll Incomes+ Section 28 Incomes
ExpensesxxExpense Allowed as per Section 29-43B
ProfitxxPGBP Income

 

 Lets study expenses first which are also called Deductions

 

 

 

About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 6 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com.
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