What is Partial Integration

What is Partial Integration

Although Agricultural Income is exempt from tax, if a person has both Agricultural income and non agricltural income, he has to pay more tax on Non Agricultutal Income because of concept of Partial Integration

 

When is Partial integration Applicable

For those Assesses who enjoy benefit of slab rate and having

Agricultural Income >  5000 ,

and

Non Agricultural Income > 250000(i.e., non taxable limit)

the tax is computed through a special method called partial integration as explained below

 

  

Note :

• Partial Integration is done in order to deny the benefit of slab rate.
• It is done only in cases of those assessees who get the benefit of slab rate like Individual/HUF/AOP/BOI and that too only if Agricultural Income >5000 and Non Agricultural Income > non taxable slab rate

• No Partial integration in case of other assessees like Companies/ Partnership firm

 

 

Example 

Whether partial integration applicable in the following cases?

Case	Assessee	Agrcultural Income	Non Agricultural Income	Whether Partial Integration Applicable?
Case 1	Individual	2000	280000	View answer No Agricultural Income  should be > 5000
Case 2	Individual	5000	280000	View answer No Agricultural Income  should be > 5000  -ea-
Case 3	Individual	6000	280000	View answer Yes Agricultural Income >5000 and Non Agricultural Income > Slab Rate(250000)  -ea-
Case 4	Senior Citizen	6000	280000	View answer No Slab Rate for Senior Citizen is 300000 Non Agricultural Income  is not greater than  Slab Rate(300000)
Case 5	Company	6000	280000	View answer No No Partial Integration for Companies and firms -ea-