Computation of Income, partly Agricultural,

Foreign Government Officials >>

Taxation Management FIN 623

MODULE 4

LESSON 4.11

HEADS OF INCOME (SECTION 11)

Computation of Income which is partly Agricultural and Partly from Business OR where

Agricultural Produce is used as raw material [rule 11]

Where a person who is a cultivator or receiver of agricultural produce as rent-in-kind and who uses

agricultural produce raised or received as raw material in a business the market value of the said

produce shall be deducted as business expenditure. No further deduction is allowed in respect of any

expenditure incurred by the Tax Payer as a cultivator or receiver of rent-in-kind. The word "Market

Value" [sub-rule (3) of Rule 11] shall be:

a) Where agricultural produce is ordinarily sold in the market in its raw state or after application

of any process ordinarily employed by a cultivator or receiver of agricultural income as rent-in-

kind to render it fit to be taken to market, the market price for the produce at the time it is

used as raw material in the person's business;

b) In any other case, the sum of the following amounts, namely:

o the expenses of cultivation; and

o The land revenue rent paid for the area in which the produce is grown.

Table of Contents: