02 August 2025
Sure! Here’s a simple explanation about **Income under the head “Other Sources”** along with examples to help you understand:
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### What is Income Under the Head **Other Sources**?
Income which is **not taxable under any other head** in the Income Tax Act is taxed under the head **“Income from Other Sources.”**
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### Common Types of Income Under Other Sources:
1. **Interest Income**
* Interest on savings bank account * Interest on fixed deposits (FDs) * Interest on recurring deposits (RDs) * Interest on securities/bonds
2. **Dividend Income**
* Dividend received from domestic companies (now taxable in hands of shareholders) * Dividend from mutual funds (if applicable)
3. **Winning from lotteries, crossword puzzles, horse races, gambling, betting**
4. **Income from Gifts** (if taxable, like gifts received from non-relatives above ₹50,000)
5. **Rental income from machinery or plant, if not forming part of business income**
6. **Family pension** (partly taxable)
7. **Any other income not chargeable under other heads** (e.g., income from subletting of property if not business income)
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### Examples:
| Income Type | Taxability under Other Sources | | ------------------------------------ | ------------------------------------------------------------- | | Interest on FD/Bank Deposit | Fully taxable as per slab rate | | Dividend from Indian company | Taxable in hands of shareholder as per new provisions | | Lottery winning | Taxed at flat 30% without any deduction | | Gift from non-relative above ₹50,000 | Taxable as income from other sources | | Family Pension | Taxable after deduction of ₹15,000 or 1/3rd of pension amount |
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### Important Notes:
* **No expenses are allowed except for family pension** where standard deduction of ₹15,000 or 1/3rd of amount received is allowed. * Income under this head is **added to total income and taxed as per the individual’s slab rates**, except for lottery or gambling income which is taxed at flat 30%.
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### Example Calculation:
If you have:
* Interest on FD: ₹50,000 * Dividend from shares: ₹10,000 * Lottery winning: ₹20,000
Then,
* Interest and dividend income will be added to your total income and taxed as per slab. * Lottery winning will be taxed separately @ 30%.
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Would you like me to provide detailed tax planning or examples on any specific type of income under this head?
CAclubindia
