CMA Inter Paper 7 (DITX) study guide
CMA Inter Paper 7 (DITX) · Work through your exam, one topic at a time.
CMA Inter Paper 7, usually called DITX (Direct Taxation), is one of the papers in the Intermediate level of the CMA (Cost and Management Accountancy) course offered in India. It suits students who have cleared the CMA Foundation or entered through a recognised degree route and who now need a working command of Indian direct tax law - not just definitions, but the ability to compute taxable income and tax liability for a realistic fact pattern. The CMA Inter Paper 7 (DITX) study guide has 11 sections and about 3,343 words.
01Basic Concepts of Income Tax and Residential Status
This domain tests how income is classified and whose global or Indian-source income enters the tax computation. Start with the previous year (the income year) and the assessment year (the following year), then fix residential status before applying any head of income.
358 words, about 2 min02Income from Salaries
This domain examines salary taxable on a due-or-received basis and the exemptions and perquisite valuations that convert gross salary into taxable salary. Salary arises from an employer-employee relationship.
330 words, about 2 min03Income from House Property
This domain tests the annual value of property, statutory deductions and the restrictive treatment of interest, especially for self-occupied houses. Charge arises on buildings or land appurtenant to buildings owned by the assessee and not used for business or profession.
329 words, about 2 min04Profits and Gains of Business or Profession
This domain tests computation of business and professional income under the mercantile or cash system, admissibility of expenses, statutory disallowances and presumptive schemes. Income is computed from accounts maintained under the chosen method.
296 words, about 1 min05Capital Gains and Income from Other Sources
This domain covers transfers of capital assets, holding periods, cost adjustments and exemptions, together with residual income taxed under “other sources”. Capital gain arises on transfer of a capital asset.
294 words, about 1 min06Deductions from Gross Total Income and Computation of Total Income
This domain tests Chapter VI-A deductions, their limits and conditions, and the final aggregation of income under the correct regime. Gross total income is the sum of the five heads after intra-head adjustments and set-off of losses.
298 words, about 1 min07Assessment Procedures
This domain tests return filing, processing, scrutiny and the consequences of non-compliance. A return of income is filed under section 139 within the due date: generally 31 July for non-audit individuals and 31 October for assessees requiring audit.
286 words, about 1 min08TDS/TCS and Advance Tax
This domain tests withholding and collection at source, payment and return timelines, and the advance-tax instalment system. TDS applies to specified payments such as salary under section 192, interest under 194A, dividends under 194, contractor payments under 194C, professional fees under 194J and rent under 194I.
299 words, about 1 min09Tax Planning, Avoidance and Evasion
This domain tests the boundary between legitimate planning, abusive avoidance and illegal evasion, and the anti-avoidance rules that apply. Tax planning uses the law openly to reduce tax: choosing an eligible entity, timing income and deductions, using exemptions, and structuring remuneration and investments within statutory limits.
270 words, about 1 min10International Taxation and Transfer Pricing
This domain tests cross-border income, treaty relief and the arm’s-length principle for transactions between associated enterprises. A resident is generally taxed on global income, with foreign tax relief under section 90 for treaty countries or section 91 for non-treaty countries.
276 words, about 1 min11GST and Indirect Tax Interface
This domain tests GST supply, registration, input tax credit and the points where indirect tax records intersect with income-tax computation. GST is a destination-based tax on supply of goods or services.
307 words, about 2 min