Ans to quiz 1:
Correct Answer: YES, still taxable in April
Even though it is advance against future salary, the Income Tax rule for salary income is:
Salary is taxable on due basis OR receipt basis, whichever is earlier
(Section 15 of the Income Tax Act)
Since Ms. Y received the money in April, it becomes taxable in April itself.
📌 Key concept for students:
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Advance salary → taxable on receipt
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Arrears of salary → taxable on receipt (relief u/s 89 may apply)
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Salary due but not received → taxable on due