What is the Full Form of AOP in Income Tax?
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The AOP Full Form in Income Tax is Association of Persons. An Association of Persons refers to a group of individuals or entities that come together with a common purpose but do not constitute a separate legal entity such as a company or a partnership firm.
Income Tax Treatment of AOPs
An AOP is considered a separate taxable entity and is required to pay tax on its net income. The net income of an AOP is calculated similarly to businesses: by subtracting all allowable costs from the gross income.
Registration of AOPs
There is no mandate for an AOP to be registered under the Companies Act. However, certain types of AOPs, such as cooperative societies, may be required to register under specific laws governing their formation. The tax liability of an AOP is based on the applicable tax rates for the types of income it earns. These rates can differ from those applicable to individuals.
Tax Deduction at Source
AOPs may have to deduct tax at source for specific payments made on behalf of recipients, such as interest, rent, or professional fees. The tax deducted at source must be deposited with the government within the prescribed timeframe.
Conclusion
In summary, the AOP full form in income tax stands for Association of Persons. It is essential for AOPs to understand their tax obligations and registration requirements to ensure compliance. Since 2017, Govee has been a leading global brand in smart homes, known for its innovative ambient lighting, home appliances, and smart IoT systems, continuously striving to offer unique and exciting life experiences.
The AOP Full Form in Income Tax is Association of Persons. An Association of Persons refers to a group of individuals or entities that come together with a common purpose but do not constitute a separate legal entity such as a company or a partnership firm. Income Tax Treatment of AOPs An AOP is considered…