INCOME FROM OTHER SOURCES

INCOME  FROM  OTHER  SOURCES

Incomes taxable under the head Other Sources Section 56

If any income cannot be taxed under first 4 heads, such income shall be taxable under the head other sources and such income may be

1.    Interest income

2.    Dividend income

3.    Casual income

4.    Gift

5.    Family pension

6.    Payment received under keyman insurance policy to a person who is not an employee

7.    Income from owning and maintaining of race horses

8.    Forfeiture of advance money

9.    Income from undisclosed sources.

10.     Any other income which is not taxable under first four heads.

 

Deductions allowable:-

Deductions allowable under Section 57


While computing income under the head other sources, expenses incurred in connection with earning of such income shall be allowed to be deducted.


Amounts not deductible Section 58


While computing income, any personal expense shall not be allowed to be deducted and also in case of capital expenditure only depreciation shall be allowed.


As per section 58(4), no deduction in respect of any expenditure or allowance shall be allowed in computing the income by way of 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.


E.g. Mr. X purchased lottery tickets of Rs.10,000 and he had a winning of Rs.1,00,000, in this case, his income shall be considered to be Rs.1,00,000 and expenditure of Rs.10,000 shall not be allowed.

 

Profits chargeable to tax Section 59


If the assessee has claimed any expenditure while computing income and subsequently he has recovered the same amount, the amount so recovered shall be considered to be the income of the year in which amount has been recovered.



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