SUBJECT:CORPORATE TAXATION

TOPIC:INCOME FROM OTHER

SOURCES

PRESENTED BY:
MOHAMMEDGULAMHUSAINWALA(2013)
&
KRSIHNAKUMAR KHARVA (2067)
 CHARGEABILITY: As per section 56(1)income of
every kind which is not to be excluded from the
total income shall be chargeable to income tax
under the headincome from other sources,if it is
not chargeable to income tax under any of the first 4
heads.
In other words following conditions must be satisfied
i. There must be an income.
ii. Such income is not exempt under the provisions of
this act.
iii. Such income is not chargeable to any of the 4 heads
viz:salary,house property,profit and gains of business
and profession and income from capital gain.
 Method of accounting:

Income chargeable under this head is computed in

accordance with the method of accounting regularly
employed by the assessee.

For instance, if books of account are kept on the basis of

mercentile system,income is taxable and expenditure is
deductible on due basis,whereas if books are kept on
cash system income is taxable onreceipt basis and
expenditure is deductible under payment basis.
 SPECIAL PROVISIONS:
Following 9 incomes are always taxable under the
head income from other sources.
They are :
i. Dividend.
ii. Winning from lotteries(casual income).
iii. Employees contribution towards staff welfare scheme.
iv. Interest on securities
v. Rental income of machinery plant or furniture
vi. Rental income of letting out of plant,machinery or
furniture.
vii. Sum received under keyman insurance policy.
viii. Gift
ix. Interest on compensation or enhanced compensation.
 OTHER INCOMES:
which are normally included under the head income
from other sources:

1) Income from subletting

2) Interest on bank deposits and loan
3) Income from loyalty
4) Directors fee
5) Ground rent
6) Agriculture income from a place outside india
7) Directors commission for standing as a guarantor to
bankers and underwriting shares of new company
8) Examination fees received by a teacher from a person
other than his employer.
 9) Rent of a plot of land.
10) Mining rent and royalties.
11) salaries payable to a member of
parliament .
12)family pension received by family member
of a deceased employee.
13)income from undisclosed sources.
14) income from racing establishments.
15) gratuity paid to a director who is not an
employee of the company.
16)compensation received for use of
business assets.
 FORMAT OF COMPUTATION OF INCOME
FROM OTHER SOURCES
PARTICULARS RS RS

1. DIVIDEND
a) on shares of a domestic company Exempt
b) On shares of a foreign company Xxx
c) On units of UTI/mutual funds Exempt
expenditure deductible in case of dividend from foreign co.
less: a) collection charges xxx
b) interest on capital borrowed xxx xxx
2. INTEREST
a) on deposit with bank/co op society xxx
b) On deposit with companies Xxx
c) On loans given Xxx
d) On deposits with any other person Xxx
e) On non govt. securities Xxx
f) Accrued interest on NSC/KVP/IVP Xxx
g) Interest on income tax refund Xxx
h) Interest on notified relief bonds Exempt
less: a) collection charges Xxx
b) interest on borrowed capital xxx xxx
3. RENT INCOME
a) From house property sublet xxx
b) From other assets let out(if not charged under PGBP) xxx
less: a) collection charges xxx
b) expenses on assets let out xxx
c) depreciation on assets let out xxx
d) repairs and insurance on assets xxx Xxx
4. CASUAL INCOMES
a) Winning from lotteries xxx
b) Winning from horse races xxx
c) Winning from card games/gambling/betting incomes xxx
d) Income from cross word puzzles xxx xxx
5. SUM RECEIVED FROM EMPLOYEES AS CONTRIBUTION
TO ANY STAFF WELFARE SCHEME xxx
less :amount deposited before due date xxx xxx

6. OTHER INCOMES xxx xxx

TOTAL INCOME FROM OTHER SOURCES XXX

THANK YOU