Trade Union Income Heads Classification

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This discussion focuses on the correct classification of income for trade unions. The key distinction is between one-time membership fees, which are suggested to be capitalised as a corpus fund, and monthly subscription fees. There's a debate on whether subscription fees should be classified as 'income from other sources' and claimed as exempt under Section 10(24), with advice suggesting only subscription fees are exempt and should not be classified as 'other income'.

shivani

shivani (Querist)
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27 February 2025 Hello, For trade unions there is a collection of 2 amounts one is membership which is collected one time in life and other is subscription fees which is collected every month. I want professional advice on the classification of the above incomes. Membership fees would be capitalized as corpus fund, but or subscription fees should we classify it under income from other sources and make it exempt as per 10(24)? There is no other income of trade union.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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27 February 2025 Classify both as membership fees and claim exemption under section 10(24).

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shivani

shivani (Querist)
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27 February 2025 @CA R SEETHARAMAN Thank-you sir for responding. But subscription fees are collected monthly and Membership is one time. Collecting Subscription fees from members cannot be considered as business, hence it can be considered as other income and we can claim exemption u/s 10(24), what are your views on this approach?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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27 February 2025 Only subscription fees collected is exempt.
Other incomes are taxable.
Don't classify it as other income.

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