Personal income the total money received by individuals and household of a country from all possible sources before direct ta
xes. The factor of production does not the whole amount of national income. Corporate income fax should be paid to the government from corporate profile .This is not available to the shareholders and therefore it does not constitute personal income. Some part of the corporate profile is kept undistributed or retained by the business units. Similarly, the salaried person should keep some part of their salaries in the form of provident fund, pension and social security contribution. These amounts should also be deducted from national income because they are not available to the individual. At the same time, government provides transfer payment in the form of unemployment allowance, old age allowance, interest on public debt. These amounts personal income but are not a part of the national income.
xes. The factor of production does not the whole amount of national income. Corporate income fax should be paid to the government from corporate profile .This is not available to the shareholders and therefore it does not constitute personal income. Some part of the corporate profile is kept undistributed or retained by the business units. Similarly, the salaried person should keep some part of their salaries in the form of provident fund, pension and social security contribution. These amounts should also be deducted from national income because they are not available to the individual. At the same time, government provides transfer payment in the form of unemployment allowance, old age allowance, interest on public debt. These amounts personal income but are not a part of the national income.
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