What do you mean by income from other sources?

Chargeability

As per section 56(1), income of every kind, which is not be excluded from the total income under this Act, shall be chargeable to income-tax under the head “income from other sources” if it is not chargeable to income tax under any of the first four heads specified in section 14.

In other words, the following condition must be satisfied before income can be taxed under head “income from other  sources”.

1. There must be an income
2. Such is not exempted under the provision of this Act
3. Such income is not chargeable to tax under any first four heads, “income from salary “, “income from house property”, “profits and gains of business profession” and “income from capital gains”.

  Income from other sources is, therefore,a residuary head of income.

TYPES OF INCOME FROM OTHER SOURCES

• Income from  sub-letting a house property by a tenants

• Casual income

• Insurance commission

• Family pension (payment receive by legal heirs of a deceased employees)

• Director’s sitting fee for attending board meeting

• Interest on bank deposits/deposits with companies

For a residential individual (age of 60 years or less) or HUF, interest earned up to Rs.10,000 in a financial year is exempt from tax. The deduction is allowed on interest income earned from:

Savings account with a bank

 Savings account with a co-operative society carrying on the business of banking; or ´Savings account with a post office

• Interest on loan

• Income from undisclosed sources

• Remuneration received by member of parliament

• Interest on securities of foreign government

• Examiner ship fees received by a teacher from an institution other than his employer

• Total interest till date on employer’s contribution to an unrecognized provident fund at the time of payment of lump sum amount from the unrecognized provident fund due
• Rent from a vacant piece of plot of land

• Agricultural income from agricultural land situated outside India

• Interest received on delayed refund of income-tax

• Income from royalty, if it is not income from business or profession

• Director’s commission for standing as a guarantor to banker;
• Director’s commission for underwriting shares of a new company;
• Gratuity received by a director who, under the relevant contract, is not an employee or servant of the companies a assessable as income from other sources;
• Income from racing establishment

• Income from granting of mining rights

• Income from markets, fisheries, rights of ferry or moorings

• Income from grant of grazing rights

• Interest paid by the government on excess payment of advance tax,etc
• Income received after discontinuance of business.  
• GIFT

ACCORDING TO INCOME TAX ACT 1961 “ANY SUM OF MONEY, THE AGGREGATE VALUE OF WHICH EXCEEDS RS. 50,000 IS RECEIVED WITHOUT CONSIDERATION OR PROPERTY (WHETHER MOVABLE OR IMMOVABLE) IS RECEIVED WITHOUT CONSIDERATION OR PROPERTY IS RECEIVED FOR AN INADEQUATE CONSIDERATION BY ANY PERSON ON OR AFTER 1ST APRIL 2017, IF THE AMOUNT OF SUCH GIFT OR INADEQUATE CONSIDERATION EXCEEDS RS. 50,000

1. NOW JOIN TALLY ERP 9 FULL COURSE [FREE] CLICK HERE
2. NOW JOIN TALLY PRIME FULL COURSE [FREE] CLICK HERE
3. NOW JOIN BUSY FULL COURSE [FREE] CLICK HERE
4. NOW JOIN ADVANCE EXCEL COURSE [FREE] CLICK HERE
5. NOW JOIN ACCOUNTING COURSE [FREE] CLICK HERE