Overview of Section 112 Section 112 of the Income Tax Act, 1961 governs the taxation of long-term capital gains (LTCG) for assets not covered under Section 112A. This includes various capital assets such as unlisted securities, immovable property, zero-coupon bonds, and other long-term capital assets. Key Features of Section 112 Applicable Assets Section 112 applies […]
Here’s a detailed breakdown of the tax rates on long-term capital gains (LTCG) for assets not covered under Section 112A (i.e., non-equity assets like real estate, unlisted shares, debt funds, etc.), incorporating the latest updates from Budget 2024 and applicable provisions under Section 112 of the Income Tax Act: 1. Applicable Assets Under Section 112 Listed securities(where STT is not paid on
Overview of Section 112A Section 112A of the Income Tax Act, 1961 governs the taxation of long-term capital gains (LTCG) arising from the transfer of specified securities, including: Equity shares of listed companies Units of equity-oriented mutual funds Units of business trusts This section was introduced in Budget 2018 (effective from FY 2018-19) to replace
Tax on Long-Term Capital Gains (LTCG) Under Section 112A Read More »
Section 115F of the Income Tax Act, 1961, provides a tax exemption to Non-Resident Indians (NRIs) on long-term capital gains (LTCG) arising from the transfer of foreign exchange assets if the proceeds are reinvested in specified assets within India. This provision is designed to encourage NRIs to repatriate and reinvest their foreign earnings in India while offering tax relief. Key Features of Section 115F
Section 115F: Exemption on Long-Term Capital Gains from Foreign Exchange Assets for NRIs Read More »
The Indian Income Tax Act, 1961 classifies taxable income under five distinct heads, with “Income from Other Sources” serving as the residual category under Sections 56 to 59. This head functions as a catch-all provision that taxes any income which doesn’t fall under the other four categories: Salaries, Income from House Property, Profits and Gains
Specific Incomes included under ‘Income from Other Sources’ [Section 56(2)] Read More »
Section 56(1) serves as the residual head of income, capturing all taxable income that does not fall under the other four heads: Salary Income from House Property Profits and Gains of Business or Profession (PGBP) Capital Gains Conditions for Chargeability: Existence of Income: There must be an actual receipt or accrual of income. Non-Exempt Status: The
Key Provisions of Section 56(1): Chargeability of Income from Other Sources Read More »
Here’s a detailed explanation of the taxability of dividends under Section 56(2)(i) as “Income from Other Sources” under the Income Tax Act, 1961: 1. Scope of Section 56(2)(i) Section 56(2)(i) mandates that dividend income received by taxpayers (individuals, HUFs, firms, etc.) is taxable under the head “Income from Other Sources” unless exempt under other provisions. This includes: Dividends from
Taxability of Dividends under Section 56(2)(i) as “Income from Other Sources” Read More »
1. Applicability Section 56(2)(ib) covers casual and non-recurring income from: Lotteries(including online lotteries) Crossword puzzles Horse races Card games(e.g., poker, rummy if played for stakes) Gambling(casino, betting, etc.) Game shows(TV/online contests with cash prizes) 2. Tax Treatment Flat Tax Rate: 30% + 4% cess(effective 2%) under Section 115BB. No Deductions: Expenses incurred (e.g., ticket costs, participation fees) cannotbe deducted. No Slab
1. Scope of Section 56(2)(id) This provision covers interest income from securities when: Not chargeable under “Profits and Gains of Business or Profession” (PGBP) Not exempt under any other provision of the Income Tax Act Includes: Government bonds (e.g., RBI bonds, SDLs) Debentures (listed/unlisted) Corporate bonds Other marketable securities 2. Tax Treatment Taxable at Normal Slab Rates(5%-30% +
1. Applicability Section 56(2)(ii) covers rental income from: Machinery Plant(equipment, tools, vehicles) Furniture when not chargeableunder: Business income (PGBP), or House property income Key Condition: The letting must be separate from building/land. If let along with building, it may fall under composite rent (taxed differently). 2. Tax Treatment Taxable under “Income from Other Sources” Gross Rent Receivedis taxable Deductions Allowedunder Section 57:
Taxability of Income from Letting Out Machinery, Plant or Furniture [Section 56(2)(ii)] Read More »
