Other Income (also mean income received from other sources) head w.r.t. Income Tax Filing and FAQs covering Definition, Dividends, Winnings, Interest received, Gifts by an Individual, and HUF, Family pension and gifts from friends. Often times Other Income may be attract higher Tax brackets, hence its important to understand. A comprehensive list of frequently asked questions on Other Income w.r.t Income Tax for AY 2020-21
Dividend received from any entity other than domestic company. This is becausedividend received from a domestic company has been made exempt in the hands of the receiver. Accordingly dividend received from a cooperative bank or dividend received from a foreign company will be taxable as income from other sources.Winnings:
This includes winnings over Rs.10000 from lotteries, puzzles, races, games and all forms of gambling and betting. E.g. card games, horse races, game shows etc.Interest received:
All interest income earned in the previous year (oncompensation/enhanced compensation) is taxable. However, up to 10000 of this income can be claimed as deduction. From assessment year 2019-20 the deduction limit is increased to Rs.50,000 for senior and super senior citizen.
Gifts received by an individual or HUF (which are chargeable to tax) are also taxed under this head.
In addition to above, following incomes are charged to tax under this head, if not taxed under the head “Profits and gains of business or profession”
Family pension is taxable as income from other sources and a standard deduction of 1/3rd of pension or Rs 15,000 whichever is less is allowed.
Yes. However, the benefit of spread over of income to the years to which it relates to can be availed for lower incidence of tax. This is called as relief
u/s 89 of the Income-tax Act.
Relative for this purpose means in case of individual:
In case of HUF, any member thereof.
Friend is not a relative as defined in the relative list and hence, gift received from friends will be charged to tax (if other criteria of taxing gift are satisfied).
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