Incomes which are taxed under Income from Other Sources

TAXABLE INCOME UNDER 'INCOME FROM OTHER SOURCES'

Here we will study which incomes are taxed under the head "Income from Other Sources" under the Indian Income Tax Act,1961.

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Section 56 of the Income Tax Act provides the list of the incomes which are taxed under Income from Other Sources :

(1) Every Income which is required to be taxed and which is not included in any other heads of Income i.e. Salaries, House Property, Business or Profession, and Capital Gains.

(2) Particularly, the following incomes will be chargeable to tax under "Income from Other Sources"

(a) Dividend Income

(b) any winnings from lotteries, crossword puzzles, races including horse races, card games, and other games of any sort or from gambling or betting of any form or nature whatsoever.

Here:

(i) "lottery" includes winnings from prizes awarded to any person by draw of lots or by chance or in any other manner whatsoever, under any scheme or arrangement by whatever name called;

(ii) "card game and other game of any sort" includes any game show, an entertainment program on television or electronic mode, in which people compete to win prizes or any other similar game ;

(c) any sum received by the assessee from his employees as contributions to any provident fund or superannuation fund or any fund set up under the provisions of the Employees' State Insurance Act, 1948 (34 of 1948), or any other fund for the welfare of such employees ;

(d) Any income by way of Interest on Securities if the same is not taxed under Business or Profession head.

(e) Any Income from letting of Plant, Machinery, or furniture if the same is not taxed under Business or Profession head.

(f) Where any building along with plant, machinery, or furniture is let out and both are not separable, then the same is taxed under Income from Other Sources (if the same is not taxed under business or professional income)

(g) Any Gifts made to persons other than relatives over Rs. 50000.

For details please refer our Article "Taxability of Gifts under Income Tax"

(h) any sum of money received as an advance or otherwise in the course of negotiations for the transfer of a capital asset, if,—

(a) such sum is forfeited; and

(b) the negotiations do not result in the transfer of such capital assets;

(i) income by way of interest received on compensation or enhanced compensation

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