Explain “Gross Total Income” and discuss the provisions regarding “Set-off and Carry-forward of Losses” under the Income-tax Act, 1961.
✅ Q.5 – Explain “Gross Total Income” and discuss the provisions regarding “Set-off and Carry-forward of Losses” under the Income-tax Act, 1961. A. Meaning of Gross Total Income (GTI) The term Gross Total Income (GTI) is defined under Section 80B(5) of the Income-tax Act. GTI means the total income computed under all five heads of income before allowing deductions under Chapter VI-A (Sections 80C to 80U). GTI = Income from Salary Income from House Property Income from Business/Profession Capital Gains Income from Other Sources ➤ After computing income under each head, all incomes are aggregated to form the Gross Total Income . B. Importance of GTI GTI is required to determine: Eligibility and limit of deductions under Sections 80C to 80U Total taxable income Tax slab applicability Note: Deductions are applied only after computing GTI. C. Set-off and Carry-Forward of Losses (Sections 70 to 80) These provisions allow taxpayers to adjust losses against profi...