Income - amount of money coming to a person or corporation within a specified time whether as payment for services, interest or profits from investments other than mere return of capital.
Capital- fund of material wealth that can be used for the further production of wealth to satisfy human wants or tools of production or resources of business enterprise.
Income Tax- tax on the net income or the entire income realized in one taxable year levied upon corporate or individual incomes in excess of specified amounts and less certain deductions and specified exemptions in cases permitted by law.
Requisites for Income to be Taxable
1. There must be gain or profit;
2. The gain must be realized or received and
3. The gain must not be excluded by law or treaty from taxation.
Taxable income- amount of income upon which the tax rate prescribed by law is applied to get the amount of income tax payable.
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