Tuesday, 18 March 2014

What does the Income Tax Department consider as income?

 Taxable Income
  1. What does the Income Tax Department consider as income?
The word Income has a very broad and inclusive meaning. In case of a salaried person, all that is received from an employer in cash, kind or as a facility is considered as income. For a businessman, his net profits will constitute income. Income may also flow from investments in the form of Interest, Dividend, and Commission etc. Infect the Income Tax Act does not differentiate between legal and illegal income for purpose of taxation. Under the Act, all incomes earned by persons are classified into 5 different heads, such as:

    1. Income from Salary
    2. Income from House property
    3. Income from Business or Profession
    4. Income from capital gains
    5. Income from other sources

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