Taxability of income

Allowances received by Members of Parliament (MP) and Members of Legislative Assemblies (MLA) are generally exempt from tax under Section 10 of the Income Tax Act. However, this exemption typically applies to specific allowances like daily allowances and constituency allowances. Any expenses exceeding the provided allowance, or other income sources, may be taxable. Pensions received by MLAs and MPs are considered taxable income under the 'income from other sources' head.