Certain income is not taxed in India under the Income Tax Act, 1961. This income is called tax free income. Income tax is not payable on tax free income. Let us know today which are the five incomes which are non-taxable.
Tax is levied on earnings above a certain limit, hence every year the employed and other income tax payers have to pay tax. But, do you know that there is no tax on income from certain sources. For a while you will think, does this really happen? But, this is true, because there are 5 types of income on which no tax has to be paid.
There are also provisions for non-taxable income in the country. This is the income which is not subject to income tax. Let us tell you from which source of income is considered non-taxable in India.
Income from agriculture is tax free
Under section 10 (1) of the Income Tax Act, income from agriculture is completely tax free. This includes production, processing and distribution of wheat, rice, pulses, fruits. Apart from this, the rent received from the property which is used for agricultural work is also tax free, as well as the income from the purchase and sale of agricultural land is also non-taxable.
Under Section 56 (ii) of the Income Tax Act, there is no tax on property, jewelery or money received from relatives. However, gifts received from non-relatives are exempt only with a limit of Rs 50,000. Income received from an Undivided Hindu Family (HUF) or in the form of inheritance is kept out of the purview of income tax under Section 10(2) of the Income Tax Act.
No tax on gratuity and scholarship
Gratuity received after the death or retirement of a government employee is completely tax free. Private sector employees also get the benefit of tax relief on gratuity up to Rs 10 lakh. According to the Income Tax Act, tax deduction on gratuity also depends on other limits.
Scholarships given by various institutions to students to complete their education are tax free, also winners of gallantry awards like Mahavir Chakra, Param Vir Chakra, Vir Chakra and other pensioners are not required to pay tax on the pension received. Is.
Additionally, as per Section 10(15) of the Income Tax Act, interest income on certain schemes is completely tax free. Among these, there is no tax on interest received on Sukanya Samriddhi Yojana, Gold Deposit Bond, Local Authority and Infrastructure Bond.
