Section 28 of the Income-tax Act,1961 is regarded as one of the most significant provisions in the Indian tax law pertaining to “Profits and Gains of Business & Profession’’(PGBP). The section outlines the opportunity for income from a business/profession and its taxability. Let’s go through the meaning, purpose, types of income covered, and other key details of section 28 of the Income Tax Act.What is section 28 of the Income Tax Act?Section 28 of the Income Tax Act,1961 outlines the taxation rules regarding income generated from professional activities or business operations. It defines the scope of income classified under "Profits and Gains of Business & Profession".This section encompasses various sources of income arising from professional engagements or business endeavours. These include revenue from the sale of goods or services, interest earned on capital, and remuneration such as salaries, commissions, or bonuses received by partners of a partnership firm.Additionally, it encompasses other receipts deemed to be profits and gains from business or profession, such as insurance claims for stock-related profit or loss and compensation for the cessation of employment duties.Purpose of Section 28This particular section of the Income Tax Act sets out various sources of income and dealings falling within the ambit of “Profits and gains of business or profession”.

The Public Provident Fund (PPF) is one of India's most popular government-backed long-term savings schemes, offering safe, tax-efficient, and guaranteed returns. With an interest rate of 7.1% p.a. for Q2 FY 2026-27, PPF helps individuals build a retirement corpus while enjoying EEE tax benefits under the Income Tax Act, 2025.What is the PPF Interest Rate for FY 2026-27?The PPF interest rate for Q2 of FY 2026-27 (July - September 2026) is 7.1% per annum, compounded annually. The Government reviews the PPF interest rate every quarter and may revise it based on prevailing government bond yields.How PPF Interest is Calculated?PPF interest is calculated on the lowest balance between the 5th and the last day of each month and is credited to the account at the end of the financial year.Formula:Interest = Lowest Monthly Balance × Applicable Interest Rate ÷ 12Deposits made on or before the 5th of a month earn interest for that month, while deposits made after the 5th start earning interest from the following month.Why You Must Deposit Before the 5th of Every Month?Since PPF interest is calculated on the lowest balance between the 5th and the last day of the month, depositing before the 5th helps you earn an additional month's interest.Deposit DateDeposit AmountInterest for April4 AprilRs. 50,000Eligible10 AprilRs.

Tax planning for salaried employees is a strategy by which taxpayers minimise their tax liability by maximising the use of exemptions, deductions, allowances, rebates, and other benefits provided under the provisions of the Income Tax Act, 1961. It aims to maximise savings and minimise tax liability through various legitimate tax-saving options for salaried individuals.How to Plan Taxes for Salaried Employees?1. Understanding the Tax SlabsThe first step in tax planning is understanding the applicable tax slabs based on income and age. As per the financial year 2025-26, the tax rates are categorised into:New Tax Regime Old Tax Regime New Tax Regime u/s 115BACIncome Tax SlabsIncome Tax RatesUp to Rs 4 lakhNILRs 4 lakh - Rs 8 lakh5%Rs 8 lakh - Rs 12 lakh10%Rs 12 lakh - Rs 16 lakh15%Rs 16 lakh - Rs 20 lakh20%Rs 20 lakh - Rs 24 lakh25%Above Rs 24 lakh30%Note: A tax rebate up to Rs 60,000 is available for resident individuals if the total income does not exceed Rs 12 lakh (not applicable for NRIs)Old Tax RegimeIncome Tax SlabsIncome Tax RatesUp to Rs 2.5 lakhNilRs 2.5 lakh to Rs 5 lakh5%Rs 5 lakh to Rs 10 lakh20%Above Rs 10 lakh30%Note: Tax rebate up to Rs.60,000 is available for resident individuals if the total income does not exceed Rs 12,00,000 (not applicable for NRIs)2. Utilise Section 80C DeductionsSection 80C of the Income Tax Act allows deductions up to Rs 1.5 lakh.

In the complex web of taxation laws and exemptions, one that often goes unnoticed but significantly impacts the lives of many employees is the Washing Allowance Exemption. As per Section 10(14)(i), the exemption is offered to salaried employees who incur expenses to clean and maintain their uniforms on official duty.It is essential to understand the provisions, exemptions, and limits under the Income Tax Act to properly understand the aspects of the washing allowance exemption. Let us delve deeper into this article to get a proper understanding of the Washing Allowance Exemption under the Income Tax Act 1961.What is the Washing Allowance?A washing allowance is provided to employees for maintaining the uniform or work attire required by their job. This allowance helps cover the cost of laundry and maintenance of the uniform. Washing Allowance Exemption LimitThe Washing Allowance Exemption limit is the highest amount an employee may claim as an exemption from their employer's washing allowance. In accordance with Section 10, the ceiling for the Washing Allowance Exemption under the Income Tax Act of India is Rs.1,000 per month or Rs.12,000 per year. This implies that if an employer offers a monthly washing allowance of up to Rs.1,000, the full payment is tax-free.

Employees have a certain number of paid leaves in a year which they can avail at their discretion. However, most of the time these leaves remain unused. In such a scenario, the employer allows the employee to carry forward the unused leave to the next year. The employees also have an option to get paid for their unused leaves instead of taking holidays. Such monetary compensation is taxable in the hands of the employee. This article will explain the tax implication on leave encashment received and the exemption that the employee can claim as per the Income Tax Act.

If you are an employee or a fresher looking for a job, you should know that your offer letter will have details of the Cost-to-Company (CTC). As the name suggests, CTC refers to the amount that the company bears to hire an employee. CTC will have many components in its total structure; however, understanding each component is complex. In this article, we will understand the different components that are usually included in CTC.Difference between CTC and Gross SalaryCTC is the total amount spent by a corporation to hire and retain an employee. It covers your pay as well as all of your perks, such as EPF, HRA, medical insurance, gratuity, and other allowances.

Over the years, the trend of placing bets on online fantasy sports apps has increased rapidly. For example, whenever the Indian Premier League takes place, people all over India start placing bets on the outcome of upcoming matches. As per court rules, these activities are legal and thus are liable for taxation. Under section 115BBJ of the Income Tax Act, 1961, the winnings from fantasy sports such as Dream 11, MPL and My11Circle is subject to flat rate 30% tax.So, if you are thinking of placing a bet on your favourite team, keep reading this article. You will get to know the applicable tax rates and much more!What is the Tax Rate on Earnings from Online Fantasy Sports Apps?In India, income earned from online game apps is taxable for every person.

Gifts received by taxpayers are both taxable and not taxable under the Income Tax Act depending on who the person gifting is. Gift received from specified relative is completely not taxable. However, gifts receoved from non-relatives is taxable as “Income From Other Source” when the aggregate value of the gifts received in the year exceeds Rs. 50,000. Gifts received on the occassion of marriage is not taxable irrespective of the value and the person gifting. What is a Gift as per the Income Tax Act?As per Section 56 of the Income-tax Act, 1961 gifts received by any person or persons are taxed in the hands of the recipient under the head ‘Income from other sources’ at applicable slab rates.

Companies and mutual funds have two ways to distribute their profits amongst their shareholders: (1) by distribution of Dividends and (2) By Issuance of Bonus Shares. Transactions of dividend distribution attract tax, so many companies and mutual funds distribute their profits by way of the issuance of additional shares/units without any cost to the recipient.What is a Bonus Issue?The bonus issue is done through profit appropriation (allocation). A company will distribute profits by issuing additional units instead of distributing the company’s profits by way of dividends. As such, a bonus issue has no tax implications on either the company issuing it or the recipient of bonus units. However, some investors smartly utilise a bonus issue as a tax planning tool.

Under section 139(9) of the Income Tax Act, 1961, if the filed Return has discrepancies or missing information, it is called a defective return. The Assessing Officer will send the taxpayer a notice about the defective return, requiring the taxpayer to rectify the issue that makes the return non-compliant with the Income Tax Act, 1961 provisions. The taxpayer is provided 15 days to fix the problem from the date of the defect return notice issued by the Income Tax department. If the issues in the tax return are not corrected within the stipulated time, the Income Tax return (ITR) will be considered as not filed, and all the consequences of non-filing ITR will be binding on the taxpayer. This article will describe how we can respond to a Defective Return notice under section 139(9).What is a Defective Return?A return is considered defective if any relevant information is omitted or reported incorrectly. In any of the above cases, the income tax department issues a defective notice u/s 139(9) to the taxpayers, intimating them about the same and asking them to correct the inaccuracies present in the return.Action Taken by Taxpayer on Receiving Defective NoticeWhen the taxpayer receives the defective return notice under section 139(9), the taxpayer should respond to the Income Tax Department after correcting the earlier return within 15 days.