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Royalty deduction removed from itr 1. which itr should i use now?

Prasad (Lecturer)     18 July 2019

 23 points

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I am a lecturer by profession, working in a private educational institute, and drawing a monthly salary. In addition, 4 years ago, I had authored a book, which is not a textbook, but a work of scientific nature. I have been receiving lumpsum royalty settlement from the publishers for the past 3 years. Previously, I was using ITR-1, and showing the royalty as income from other sources; and was also claiming deduction for the royalty through section 80QQB. It was a hassle free process all these years.

This year, I notice that there is no option to deduct under section 80QQB in the ITR-1 form. I am at a loss now. I am not sure if I should use ITR 2 or ITR 3. I have no other income sources. I do not own a house. I do not earn from agriculture or through any other business or stocks.

Please guide me which ITR I should use. I would be immensely grateful.

Thank you.


Suresh Thiyagarajan (Student)     18 July 2019

Suresh Thiyagarajan
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You can use ITR -2 as it will have deductions u/s 80QQB. 

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Prasad (Lecturer)     19 July 2019

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Thank you. Will the royalty not come under "profit and gains of business or profession"? 

"ITR-3 is also required to be filed by a person whose income is chargeable to tax under “profits and gains of business or profession” in the nature of interest, salary, bonus, commission or remuneration." - This is as per one the articles available on the net. Hence the question.


Suresh Thiyagarajan (Student)     19 July 2019

Suresh Thiyagarajan
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1. Still, there is confusion whether Royalty income from the book will be taxed under PGBP or IOS. 
2. Many people believe that Royalty from the sale of books is not the main profession to be categorized under PBGP and thus it is shown under Income from Other Sources. 
3. However, going by the definition of sec 80QQB, it was clearly mentioned as "income derived by him in the exercise of his profession" which they have used the word profession which can also be interpreted as professional income and thus to be taxed under the head PGBP. 
4. Since the above declaration of income will not have an impact on your tax liability but for the purpose of prudence practice, it is better to segregate under the appropriate heads of income. 
5. It is better to show under the head PGBP under ITR-3 and claim deductions u/s 80QQB. 
Please correct me if the above interpretation has an alternative view. 

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