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Income From Other Sources-Notes

This document discusses 19 different types of income from other sources and their tax treatment: 1. Dividends from shares in Indian companies or foreign income from cooperative societies are either fully exempt or taxable with the deduction of expenses. 2. Winnings from gambling, betting, lotteries and other games are fully taxable without ignoring expenses. 3. Rent income is taxable except for agricultural land in India which is exempt. 4. Income of MPs/MLAs from their salary is taxable but daily constituency allowances are exempt. 5. Income of a minor child is taxable in the hands of the parents, with an exemption of up to ₹1500

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6804 Anushka Ghosh
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265 views4 pages

Income From Other Sources-Notes

This document discusses 19 different types of income from other sources and their tax treatment: 1. Dividends from shares in Indian companies or foreign income from cooperative societies are either fully exempt or taxable with the deduction of expenses. 2. Winnings from gambling, betting, lotteries and other games are fully taxable without ignoring expenses. 3. Rent income is taxable except for agricultural land in India which is exempt. 4. Income of MPs/MLAs from their salary is taxable but daily constituency allowances are exempt. 5. Income of a minor child is taxable in the hands of the parents, with an exemption of up to ₹1500

Uploaded by

6804 Anushka Ghosh
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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THAKUR COLLEGE OF SCIENCE & COMMERCE

(AUTONOMOUS)
INCOME FROM OTHER SOURCES
INCOME

IFS IFHP IFBP IFCG IFOS

DW RAMU FAKIR G. ETC

1. D – DIVIDEND ON SHARES

Indian Company Foreign Income Co-operative Society

Fully Exempt Taxable (Deduct Expenses)

2. W - WINNINGS & CASUAL INCOMES

Fully Taxable (ignore Expenses)

Eg. Gambling, Betting, Lottery, Card games, Puzzle games, TV games etc.

3. R - RENT INCOME

Taxable
 Rent of Assets other than building (eg. Rent from open plot of Land, Machinery etc.)
 Composite rent (Inseparable letting) – Rent from building along with Assets
 Rent from subletting

DEPARTMENT OF ACCOUNTANCY, TCSC Page 1


SYBMS,SEM-IV, DIRECT TAX

4. A - AGRICULTURAL INCOME

Land in India Land in Abroad

Exempt U/S 10(1) Taxable

5. M1 - Income earned by MP/MLA/MLC

Salary Daily & constituency Allowance (area from where they are selected)

Taxable as IFOS Exempt U/S 10(17)

6. M2 - Income earned by MINOR CHILD


i. Income of a minor child is taxable in the hands of the parents (either mother or father whose
total income is higher)
ii. Such a parents gets an exemption u/s 10(32) of Maximum ₹1500/- p.a. per minor child.
iii. Once the income is clubbed in the hands of a parent it will continued to clubbed into the
income of parent upto to the age of minor turning 18 years .

In the following cases clubbing will not take place:

a. If the minor child earns income through own skill & talent.
b. If the minor child earns income through manual labour.
c. If the minor child suffers from some disability referred to u/s 80 (U).

7. Income from units of UTI & Mutual Funds

Exempt U/S 10(35)

8. F1- FEES- DIRECTORS BOARD MEETING

TAXABLE

DEPARTMENT OF ACCOUNTANCY, TCSC Page 2


SYBMS,SEM-IV, DIRECT TAX

9. F2 - FAMILY PENSION

Normally Received by the family members of a deceased armed force employee


Who dies in operation of duties under prescribed circumstances.

Taxable
Subject to standard Exempt U/S 10 (19)
Deduction The arm force employee who got
gallantry award after retirement they get
Standard deduction exemption on their family pension and
 1/3rd of Family pension received after their death family member will also
get exemption. U/S 10 (18)
 Actual Amount received

10. A – AWARD

Private Institute Received from Government in Public interest

Taxable Exempt u/s 10(17A)

11. K- KEYMAN INSURANCE POLICY AMOUNT RECEIVED

Taxable

12. INTEREST INCOME

GNPT PK RC Others

Exempt U/S 10(15) Taxable


 G – Gold Deposit Bonds/ Schemes
 N – National Defence Gold Bonds
- National Saving Annuity Certificate
- National Plan Certificate
 P – Post office Savings, Banks A/c (maximum ₹3,500 p.a. per account holder)
– Post Office Cumulative time Deposit A/c

DEPARTMENT OF ACCOUNTANCY, TCSC Page 3


SYBMS,SEM-IV, DIRECT TAX

– Post Office Cash Certificate


 T – Treasury saving Deposit Certificate
 P – Public Provident Fund (PPF)
 K – Konkan Railway Corporation Bonds
 R – Relief Bonds (National, Sate, RBI)
 C – Capital Investment Bonds
13. R1- Royalty Income – Taxable

14. R2 - Remuneration from Non- Employer – Taxable


(eg. Paper setting fees received from university, other college)

15. G – GIFT

Sr. no. Nature of Assets Taxable Value


1. Money The Whole Amount if the taxable value exceeds ₹50,000.
2. Immovable i. Without Consideration: The stamp value of the
Property if , it exceeds ₹50,000.
ii. Inadequate Consideration: The Difference between
stamp duty value & the consideration if such stamp
duty exceeds higher of ₹50,000 or 10% of
consideration.

3. Movable i. Without Consideration: The aggregate fair market


value of the property, if exceeds ₹50,000.
ii. Inadequate Consideration: The difference between
the aggregate fair market value and the consideration,
if such difference exceeds ₹50,000.

16. SUMS RECEIVED BY A MEMBER FROM HUF – Exempt U/S 10 (2) Subject to certain
Conditions

17. DISASTER COMPENSATION FUND – Exempt U/S 10(10BC)


 Such fund must be granted by Central or State Government or Local Authority
 Disaster means- catastrophe, mishap, calamity, or grave occurrence in any area arising
from natural or manmade cause.

18. PAYMENT FROM SUKANYA SAMRIDDHI ACCOUNT- Exempt U/S 10 (11A)

19. SCHOLARSHIPS – Exempt U/S 10 (16)

 Entire amount would be exempt.


 Scholarship may be for a Course not leading to a Degree.
 Cost of Education not only covers tuition fees but all other incidental expenses.

DEPARTMENT OF ACCOUNTANCY, TCSC Page 4

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