INCOME FROM OTHER SOURCES
Incomes which does not fall under any of the other head will fall under the head of ‘Income from Other Sources’.
Interest which are accumulates under the Saving Bank shall be mention under the head of ‘Income from Other Sources’ in tax return. Important point here is to be noted that bank does not deduct Tax Deducted at Source if the bank account is Saving Bank. Interest which are being received from any of the fixed deposited account or any of the recurring deposit account is taxable under income tax, but interest which is received under saving bank account or post office saving account is deductible not fully but to certain extent.
DEDUCTION UNDER SECTION 80TTA:
For a tax payer person whose age is 60 year or less or Hindu Undivided Family, then they can claim exemption under this section. Exemption under this section is up to Rs 10, 000. The deduction is only allowed if the interest is being received from following account:
Tax payer person whose age is more than 60 years then he is not applicable to claim deduction under this section.
Interest which is received on fixed deposit are added in the income tax return and the person will have to pay tax upon the same amount at the rate which is applicable to the tax payer. TDS can be deducted when interest is earned, even if it is not being paid.
DEDUCTION UNDER SECTION 80TTB:
For a tax payer person whose age is above 60 years then they can claim exemption under this section. Exemption under this section is up to Rs 50, 000. The deduction is only allowed if the interest is being received from following account:
Tax payer person whose age is 60 or below 60 years then he is not applicable to claim deduction under this section.
AVOIDING TAX DEDUCTED AT SOURCE ON FIXED DEPOSIT:
Banks have to deduct tax when interest income from deposits are accumulates to more than Rs 40,000 in all banks in a year. A bank have to deduct the tax at the rate of 10% if PAN is available with them, and if the PAN is not available to them then they will have to deduct the tax at the rate of 20%. The details of the same shall be mention in Form 26AS.
If the amount under Public Provident Fund and Employee Provident Fund is withdrawn by the person after maturity then the whole amount is exempt from the tax. It must be mention under ‘Income from Other Sources’ as exempt income.
If your any family member is deceased and you are receiving pension on behalf of the deceased person then this income shall be shown under the head of ‘Income from Other Sources’. There is deduction under this term which is as follows:
WHICHEVER IS LOWER will be the deduction amount for family pension.
INCOME FROM WINNING OF LOTTERY, GAME SHOWS OR PUZZLES ETC.:
If tax payer person is receiving any amount from winning of lottery or game shows or puzzles etc. then it will be taxable under the head ‘Income from Other Sources’. There is specific flat rate for tax which is 30% and cess.
EXPENSES WHICH ARE ALLOWED FOR DEDUCTION FROM CERTAIN INCOME SOURCES:
A taxpayer who receives income from other sources is eligible to deduct the expenses just like businesses are also applicable for deduction of expenses from their income.
Author- Adv.Shivam Kumar
Legel and content Executive, Taxblock India Pvt. Ltd