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Updated on : 6 May, 2018

Income from Other Sources

It is residuary head of Income which must satisfy the following conditions:-

  1. There must be an income;
  2. This income is NOT exempt under the IT Act 1961; and
  3. This income is not chargeable to tax under the other heads of income viz. "Salary", "House property", "Business or Profession" and "Capital Gains".

Example of Income from Other Sources

Some examples of certaincomes normally taxed under this head are given below:-

Computation of Income from Other Sources

Income from this source is computed after deducting the following:-

  1. Expenditure incurred during the previous year;
  2. Expenditure incurred wholly and exclusively for the purpose of earning the said income;
  3. After deducting allowances and deduction provided in Section 57 of the IT Act 1961;

And after disallowing the following:-

  1. Expenditure relating to personal expenses
  2. Interest, salary payable outside India on which TDS not made,
  3. Income / Wealth Tax paid, excessive-payments to relatives etc.
  4. Expenditure in respect of royalty and technical fees received by a foreign company;
  5. Expenditure in respect of winning from lottery.

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