Treatment of Stipend as per Income Tax Act.

Shefali Bajpai (Article Assitant & CA Final Student) (1148 Points)

20 February 2008

Hello Friends,

I would like to know whether the Stipend received from the Principal would be shown as the Salary Income or Income from Other source???

Regards,

Shefali

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10 Replies

Vijay (CA) (254 Points)
Replied 20 February 2008

HI Shefali Stipend received is treated as salary inome because there is a clear relationship of employer and employee. When an employee receives stipend, still it works under direction of employer. Pls let me know if require more informations Regards Vijay

1 Like

(Guest)

yes, stipend is treated as salary and it should be shown under income from salary

SONUJRT (CA FINAL STUDENT) (337 Points)
Replied 20 February 2008

YA, IT SHOULD NE SHOWN UNDER THE HEAD SALARY

pooja (Chartered Accountant) (68 Points)
Replied 20 February 2008

ya... it is salary income & the same is exempted under section 10(16) of Income Tax Act.

Shefali Bajpai (Article Assitant & CA Final Student) (1148 Points)
Replied 20 February 2008

Thanks a lot for the replies.

Regards.

(Guest)

For all you ppl, stipend is not at all taxable under income tax act.. and remember one thing first, when u receive stipend it clearly means your not an employee of the principal.. hence the question of employer employee doesnt arise.. It SURELY CAN NOT BE regarded as Salary... It is completely exempt under IT Act u/s 16... if reqd refer case law Ratnakar Rao (A) Vs. Additional Commissioner of Income-tax (1981) 128 ITR 0527. And ppl please read income tax properly...

Regards

Guhan V

(Guest)

Hi,

Just tell me whether ESIC and PF is applicable on stipend if company is registered under companies Act 1956 and shop establishment Act

Vignesh (B.Com CA FINAL & CMA FINAL) (193 Points)
Replied 21 November 2008

no there is no relation ship of employer and employee between the Principal and the article assistant. so it is not treated as salary income and it is not taxable

GAURAV BEHL (CA-FINAL ) (228 Points)
Replied 30 October 2009

no as per the definition of employee in epf act,, it does not include apprentice/article assistant.

shyambali yadav (chartered Accountancy final) (48 Points)
Replied 27 November 2009

as per provident fund act an apprentice or article assitant shall not be treated as employee of the oraganisation, hense no PF is applicable on stiphened paid to article assitant