Income from other sources covers all taxable income not classified under salary, house property, business/profession, or capital gains. This is the residual head including bank interest, dividends, gifts, and winnings,ensuring no income escapes taxation.Budget 2026 HighlightsFor dividends and income from units of mutual fund, 20% deduction on interest expense will not be allowed from the upcoming tax year.What is Income from Other Sources?Income from Other Sources, as per section 56 of the Income Tax Act, is a residual head of income, which covers all taxable income that does not fall under the other four heads: Salary, House Property, Profits and Gains from Business or Profession, and Capital Gains. It ensures that every form of income earned by a taxpayer is taxed appropriately, even if it does not clearly belong to a specific category.Income included under Income from Other SourcesThe following types of income are usually taxed under this head:Bank interestInterest on securities and investmentsFamily pensionLottery winnings , crossword puzzles, card games, races including horse races, and gambling of any formDividendsAny sum an employer receives from his employees towards contribution in EPF, Superannuation fund or ELSI, which is not taxable under the head, Profit and gains from business and profession, and not deposited in the relevant fund.Plant and machinery owned by the taxpayer is let out for rental purposes, if it does not fall under the head of income from business and profession.Rental income from the composite unit of plant, machinery and furniture with the building that is not separable and is not taxable under the head, Profits and Gains from business and profession.Amount received under the Keyman insurance policy (including bonuses) which is not taxable under the head, Profits and Gains from business and profession.Interest received on compensation or enhanced compensation.Any compensation received by the person due to the termination of employment.Savings Bank Account – Interest IncomeInterest that gets accumulated in your savings bank account must be declared in your tax return under income from other sources.Note that the bank does not deduct TDS from bank interest. Deduction on Interest Income Under Section 80TTAFor a residential individual (age of 60 years or less) or HUF, interest earned up to Rs.10,000 in a financial year can be claimed as a deduction. The deduction is allowed on interest income earned from savings account with a bank, co-operative banking society or post office.Senior citizens are not entitled to benefits under section 80TTA.Tax On Fixed Deposits InterestInterest earned from fixed deposits is taxable at applicable slab rates.Senior citizens can claim up to Rs.50,000 tax deduction on the interest earned from savings bank accounts, fixed deposits, recurring deposits with banks, post offices, etc., under Section 80TTB.TDS is deducted on fixed deposits when the interest crosses the applicable threshold limit.Family PensionIf you are collecting a pension on behalf of someone who is deceased, then you must show this income under income from other sources. This will be added to the taxpayer’s income and tax must be paid at the tax rate that is applicable. There is a deduction of Rs.15000 ( Rs. 25000 under new tax regime)  or one-third of the family pension received, whichever is lower. Taxation Of Winnings From Lottery, Game Shows, Puzzles - Casual IncomeIf you receive money from winning the lottery, online/TV game shows, races including horse races, card games and other games, gambling betting, etc., it will be taxable under the head Income from other Sources. The income will be taxable at flat rate of 30%, which after adding cess, will amount to 31.2%.No deductions can be claimed related to these incomes. Dividend IncomeDividends received from investments such as stocks, are taxed under “income from other sources”. Taxpayers can claim interest expense up to 20% of the dividend income. Also, if the total dividend amount exceeds Rs.5,000 (Rs. 10,000 for FY 2025-26), the company deducts TDS at 10% while paying the dividend.Income From GiftsTaxation on gifts is covered by section 56 (2)(vi) of the Income Tax Act.Any gifts received in cash exceeding Rs.50,000 shall be chargeable to tax.Any gifts received in kind (without any consideration) and the fair market value of such gift is more than Rs.50,000 then the aggregate value will be taxable in the hands of such individual.Interest On Income Tax RefundThe assessee is entitled to a refund of the excess tax paid when they have paid more than is required.To receive an income tax refund, individuals must wait a few days after filing their income tax return. Interest on the refund for this time period will be paid to the taxpayer.Interest on income tax refund is taxable and can be found in section 143(1) intimation on of the preceding assessment year.Expenses Allowed to be Deducted from Certain Income SourcesSimilar to business income, taxpayers earning Income from Other Sources are also eligible to claim certain deductions. These deductions ensure that only the net taxable income is subject to taxation.

The Double Taxation Avoidance Agreement (DTAA) is a tax treaty signed between India and over 100 countries to ensure that NRIs and taxpayers are not taxed twice on the same income. Under DTAA, income is taxed in only one country or at a reduced rate in both, depending on the terms of the agreement. India has signed DTAA with countries including the US, UK, UAE, Canada, Singapore, and more.What is Double Taxation Avoidance Agreement (DTAA)?DTAA, or Double Taxation Avoidance Agreement, is a treaty signed between two countries to prevent the same income from being taxed twice. Under DTAA, if you earn income in one country while residing in another, you are required to pay tax in only one country or at a significantly reduced rate in both.For NRIs, DTAA is especially important as it protects income earned in India from being taxed both in India and in their country of residence.Few Basic Principles of DTAADTAAIncome Tax ActRemarksIf the treaty does not address a particular disputeBut the Income Tax law contains relevant provisions, Refer to the Income Tax Act for guidance on the matter.If a treaty includes certain provisions But law is silent on dispute resolution mechanismRefer treatyIf the treaty has a provisionIncome tax law also has the same provisionFollow whatever is more beneficial for the taxpayer If treaty has some provisionsLaw has contradictory provisionstreaty will prevailHow to Determine if DTAA is Applicable?Follow these steps to determine which Double Taxation Avoidance Agreement (DTAA) applies in your case:StepQueriesDetailsStep 1Is DTAA applicable?DTAA applies only when the transaction is taxable both in India and in another country. Also, one party involved in the transaction should be a non-resident (NR) or a foreign company (FC).Step 2Which DTAA is applicable?Identify the residential status of the non-resident party.

With the advent of digital banking, India is slowly but steadily becoming a cashless economy, where major transactions are done through authorised banking channels or electronically. Not only are digital transactions faster and more convenient, they save money for individuals and businesses and reduce the circulation of black money. If you are a business owner and still make transactions in cash, you might end up not getting deductions of certain expenses. What are those deductions, you must be asking? The trouble is that you might not get tax deductions for the expenses that you incur in cash.Section 40A(3) of the Income Tax Act is one of the many measures taken by the Indian Government to restrict cash payments. It discourages individuals and businesses from making transactions through cash above a certain limit. Now, let's review the provisions, applicability, and exceptions under Section 40A(3) and learn how it works.Section 40A(3) of the Income Tax ActSection 40A(3) is an additional amendment introduced to Section 40A in 2009 that restricts payment or receipts in cash beyond a certain threshold. The section disallows tax deductions on expenses above Rs.

The Central Board of Direct Taxes (CBDT) has notified forms ITR-1, ITR-2, ITR-3, ITR-4, ITR-5, ITR-6, ITR-7, ITR-V, and ITR-U for FY 2025-26 (AY 2026-27). Taxpayers can access and download these forms from the Income Tax Department website. These forms for AY 2026-27 include major changes in reporting requirements. How to Download Income Tax Returns (ITR) Forms for AY 2026-27?Taxpayers can download forms ITR 1, 2, 3, 4, 5, 6, 7, ITR-V and ITR-U online from the Income Tax Department website through the below steps:Visit the official website of the Income Tax DepartmentNavigate to “Income Tax Provisions” and click on "Income Tax Rules, 1962"Select “Forms” in the option menuAll ITR forms will be displayed along with other Income Tax Forms. Select the ITR form you are looking for and download it in PDF format. Note: For FY 2025-26 (AY 2026-27), Income Tax Act 1961 and Income Tax Rules, 1962 will be applicable. The new Income Tax Act 2025 and Income Tax Rules 2026 will be applicable for incomes earned in FY 2026-27 and onwards. Income Tax Form FY 2025-26 (AY 2026-27) PDF DownloadITR FormsApplicability Download ITR FormsITR-1 (SAHAJ)For resident individuals other than not ordinarily resident having Income from Salaries, two house property, other sources (interest, dividend etc.), capital gains u/s 112A not exceeding Rs.

Form 12BB is a statement of claims submitted by an employee to the employer at the beginning of the financial year. The form covers declarations for key deductions such as House Rent Allowance, Leave Travel Allowance, interest on home loans, and investments under Chapter VI-A like Section 80C and 80D.As per the provisions of the new Income Tax Rules, 2026, Form 12BB has been replaced by Form 124.Form 12BB PDF Download You can download and understand the structure of Form 12BB from the income tax portal.Things to be Done Before Filling Form 12BBBased on the declarations in Form 12BB, the employer calculates and deducts the correct TDS for the financial year. Hence, it is important to fill and submit Form 12BB correctly to ensure proper TDS calculation. The following are the things to be done before filling the Form 12BB:Make sure that HRA and LTA are part of your package by studying your CTC structureThese can be claimed as an exemption if these allowances are a part of your CTC structureObtain interest certificate and loan repayment schedule from the bank.Collect the receipts for all the expenses and investments that can be claimed as a deduction, such as tuition fees, Life Insurance premium receipts, receipts for rent, donations, etc.How to Fill Form 12BB?Filling out Form 12BB isn't as difficult as it seems. This guide will walk you through each section, explaining what information to include and how to claim maximum tax benefits.Part I: Personal DetailsFull NameAddressPAN (Permanent Account Number)Financial Year (Current year: 2024-25)Part II: Details of Claims and Evidence1.

The assessees should file their ITRs using the right ITR form, which is the most suitable for the taxpayers income structure, residential status, level of income, etc. In India, there are seven ITR forms (ITR-1 to ITR-7), applicable to different kinds of assessees. Filing must be done before the specified due date each year.Types of ITR Forms and Their ApplicabilityITR 1: Salaried individuals with income up to Rs. 50 lakhITR 2: Individuals with capital gainsITR 3: Income from business or professionITR 4: Income From Business and Profession < Rs. 50 lakhITR 5: Firms, LLPs, AOPs, and BOIsITR 6: Companies ITR 7: Charitable trustsDifferent Types of ITR FormsThe ITR form applicable depends on the type and amount of income of the taxpayer as follows:ITR FormApplicabilityITR-1 (Sahaj)Resident individuals with income up to ₹50 lakh from salary, up to two house properties, and other sources (plus 112A LTCG up to ₹1.25 lakh).ITR-2Individuals and HUFs with no business income but capital gains, foreign assets, more than two properties, crypto, or income above ₹50 lakh.ITR-3Individuals and HUFs with business or professional income, including F&O traders and firm partners.ITR-4 (Sugam)Resident individuals, HUFs, and firms (except LLPs) under the presumptive scheme (44AD/44ADA/44AE) with income up to ₹50 lakh.ITR-5Firms, LLPs, AOPs, and BOIs.ITR-6Companies, other than those claiming charitable/religious exemption under Section 11.ITR-7Trusts, political parties, and institutions claiming exemptions under Section 11 and related provisions.Applicability of different kinds of ITR forms are explained elaborately below.ITR-1 or SAHAJWho Can use ITR-1?A taxpayer can file under ITR-1, if the following conditions are satisfied.Resident individualsTotal income not exceeding Rs.

The Senior Citizen Savings Scheme (SCSS) is a government backed savings scheme for senior citizens offering an annual interest rate of 8.5%, paid out monthly. Eligible individuals can invest a minimum of Rs. 1,000 up to Rs. 30 lakh for a period of 5 years. The amount invested is allowed as a deduction under the old tax regime, thus offering tax benefits to investors. Latest Update - Senior Citizen Savings Scheme (SCSS) FY 2026-27ParticularsLatest UpdateQ1 FY 2026-27 Interest Rate8.2% p.a.TDS ThresholdRs.

Cryptocurrencies are emerging as prominent financial innovation, offering decentralized and border-less transactions. In India virtual digital assets (VDAs) such as cryptocurrencies, NFTs, etc. are now subject to taxation, whose capital gains are taxable at a flat 30%.Key HighlightsSale of crypto currencies are taxed at 30% and only purchase cost can be claimed as deduction.If crypto is acquired without purchase (as a gift, mining reward, etc.), it is taxed at slab rates.TDS is deducted at 1% of sale consideration.What are Crypto Currencies as per the Income Tax Act?In layman's terms, cryptocurrencies are digital currencies designed to buy goods and services, similar to other currencies. Today, more than 1,500 virtual currencies, such as Bitcoin, Ethereum, Litecoin, Dogecoin, Ripple, Matic, etc., are traded in the digital currency world. Crypto and NFTs were categorized as "Virtual Digital Assets", and Section 2(47A) was added to the Income Tax Act to define this term. The definition is quite detailed but mainly includes any information, code, number or token (not Indian or foreign fiat currency) generated through cryptographic means. Is Crypto Taxed in India?Yes, gains from cryptocurrency are taxable in India.

ClearTax is an AI-powered income tax filing platform with vast experience in serving 7.5 Million+ trusted customers. With ITR filing options through AI Chatbot, WhatsApp, DIY product, and assisted filing services, ClearTax caters to various consumer needs to make ITR filing for FY 2025-26 easy, fast, and efficient when compared to other competitors. For taxpayers with incomes from salary, house property, capital gains, business and profession, or other sources, ClearTax provides flexibility and enhanced ITR filing tools with various broker integrations, detailed tax summary reports, easy claiming of exemptions and deductions, and automated selection of the correct ITR form and tax regime beneficial to the taxpayer.ClearTax offers both a DIY (Do It Yourself) product and Assisted Filing plans. The DIY option lets you complete your ITR filing in a simple, hassle-free way on your own. With Assisted Filing, you are assigned a tax expert experienced in handling income structures similar to yours, who manages the entire filing process from start to finish.But with the availability of many ITR filing options, it is important to choose the right platform to get your task done.

Section 115BAC of the Income Tax Act, 1961 governs the provisions related to the new tax regime for individuals. While the new regime offers relaxed slab rates, limited deductions are available under the new regime. Up to ₹12 lakh of income can be tax-free under the new regime due to higher rebates. Assessees who have a simple income structure with little to no eligible tax saving deductions can find the new regime more beneficial.Key Highlights of the New Tax RegimeNew Tax Regime offers a basic exemption of Rs. 4 lakh and a tax rebate of up to Rs.