Question
There are two slabs of income tax, 8% tax for income up
to 3 lakh and 12.5% for income above 3 lakh. Akhil tried to evade tax by hiding some of the income, to fall in the 8% tax slab. The amount hid by Akhil is 9/44 of the original taxable income. If Akhil paid Rs. 25,200 as tax, what is the original amount of tax he had to pay?Solution
Tax paid = 25200 (8% of the taxable income) Shown income = (25200 × 100)/8 = 315000 Amount hid = 9/44 of original income. Shown income = 35/44 × original taxable income Original Taxable income = (44/35) × 315000 = 396000 Tax = 12.5% × 396000 = Rs. 49500
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