CHAROTAR UNIVERSITY OF SCIENCE &TECHNOLOGY(CHARUSAT)

INDUKAKA IPOCWALA INSTITUTE OF MANAGEMENT(I2IM)

FACULTY OF MANAGEMENT STUDIES(FMS)
BUSINESS TAXATION (BM211.1)

INCOME FROM OTHER SOURCES

Submitted to: Submitted By:

Aarzoo Vohra Mitali Rana (18BBA084)
Parth Rana (18BBA085)
Priya Rana (18BBA086)
Shikha katwala(18BBA112)
 The income tax department classifies income
into five categories .they are..
1. Income from salary
2. Income from house hold property
3. Income from capital gains
4. Income from business or profession
5. Income from other sources
 INTRODUCTION

• Any income, profit or gains of the assessee, which

cannot be included in any other heads of income
(salary /House Property/Business or Profession/
Capital Gains) is chargeable under the head
Income from other source.
Residuary head of income
 Recurring income: Any income received at
regularly at equal intervals. This generally includes
interest income from the savings bank, post office
savings, fixed deposits, recurring deposits etc.

 Non-recurring income: Any income received only

once. This generally includes Income from the
lottery,  gambling, horse racing etc.
Section 56 income chargeable under other sources

 Dividends
Deemed dividend under section 2(22) from Indian
company or any dividend from foreign company is
taxable in the hands of shareholders.
Winning from lotteries etc.
Income from horse races, gambling, betting,
lotteries, crossword puzzles are taxable at a rate
of 30% under this head.
CONT’D..
 Gifts-
Any sum of money or property received without
consideration by an individual or HUF from any
person exceeding Rs. 50,000, the whole of such
amount is taxable in the hands of recipient.
(applicable from 1st october 2009)
 Rental income from machinery, plant or furniture
let on hire if not chargeable under the head business
or profession.
CONT’D..

 Income of more than Rs.10,000 through Recurring Deposits

are liable to deductions at a rate of 10%.
 Income earned from Fixed Deposit, when combined with
your source of income like salary, is liable for tax deductions.
 Income by way of interest from individuals with three or
more Fixed Deposits.
DEEMED DIVIDENDS
 Under section 2(22) the following payments or
distribution by a company to its shareholders are
deemed as dividends:
1. Any distribution entailing the release of company assets
2. Any distribution of debentures , debenture stocks ,
deposit certificates and bonus to preference
shareholders
3. Distribution on liquidation of company
4. Distribution on reduction of capital
Examples of income under other sources

 Income from sub-letting

 Interest on bank deposits and loans
 Income from royalty
 Directors fees
 Ground rent
 Agriculture income received outside India
 Directors commission for standing as a guarantor to
bankers
CONT’D..
 Directors commissions for underwriting shares of
new company
 Examination remuneration received by teacher
 Remuneration received by a person from a person
other than his employer
 Rent of plot of land
 Insurance commission
 Mining rents and royalties
AMOUNTS NOT DEDUCTABLE(58)

 Personal expenses
 Any interest paid outside India on which Tax is
not deducted at source TDS
 Any salary paid outside India without TDS
 Any expenditure or allowance in connection with
income by way of any winning from lotteries etc.