Capital and revenue profits are ___________ differently.

Taxed

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Counted

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Calculated

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None of the above

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Solution

The correct option is A Taxed
Taxation on profits is calculated based on the rules and provisions of Income Tax Act.

There are different tax rates defined for the different set of assesses.

Also normal business profit are taxed based on the normal provisions of the act considering the income as revenue receipts. Capital receipts are taxed differently like capital gain tax.

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