Income exempted from Income Tax Section 10

Section 10 of income tax act defines that some income are exempted from income tax means there is no income tax on these income. Some of these income are fully exempted from income tax and some are some exemption limit.

Like agriculture income is fully exempted from income tax whereas minor income clubbed with individual has the exemption limit of 1500. So it is neccessary to remember all these exemptions before calculating somebody income tax.

So i am presenting a full view of section 10 of income tax act with all the exemptions and exemptions limit of section 10.

Section
Nature of Income
Exemption limit, if any
10(1)
Agricultural income

10(2)
Share from income of HUF

10(2A)
Share of profit from firm

10(3)
Casual and non-recurring receipts
Winnings from races Rs.2500/- other receipts Rs.5000/-
10(10D)
Receipts from life Insurance Policy

10(16)
Scholarships to meet cost of education

10(17)
Allowances of MP and MLA.
For MLA not exceeding Rs. 600/- per month
10(17A)
Awards and rewards

(i) from awards by Central/State Government


(ii) from approved awards by others


(iii) Approved rewards from Central & State Governments


10(26)
Income of Members of scheduled tribes residing in certain areas in North Eastern States or in the Ladakh region.
Only on income arising in those areas or interest on securities or dividends
10(26A)
Income of resident of Ladakh
On income arising in Ladakh or outside India
10(30)
(i) Subsidy from Tea Board under approved scheme of replantation

10(31)
(ii) Subsidy from concerned Board under approved Scheme of replantation

10(32)
Minors income clubbed with individual
Upto Rs. 1,500/-
10(33)
Dividend from Indian Companies, Income from units of Unit Trust of India and Mutual Funds, and income from Venture Capital Company/fund.

10(A)
Profit of newly established undertaking in free trade zones electronic hardware technology park on software technology park for 10 years (net beyond 10 year from 2000-01)

10(B)
Profit of 100% export oriented undertakings manufacturing articles or things or computer software for 10 years (not beyond 10 years from 2000-01)

10(C)
Profit of newly established undertaking in I.I.D.C or I.G.C. in North-Eastern Region for 10 years

Income From Interest


10(15)(i)(iib)(iic)
Interest, premium on redemption or other payments from notified securities, bonds, Capital investment bonds, Relief bonds etc.
To the extent mentioned in notification
10(15)(iv)(h)
Income from interest payable by a Public Sector Company on notified bonds or debentures

10(15)(iv)(i)
Interest payable by Government on deposits made by employees of Central or State Government or Public Sector Company of money due on retirement under a notified scheme

10(15)(vi)
Interest on notified Gold Deposit bonds

10(15)(vii)
Interest on notified bonds of local authorities

Income from Salary


10(5)
Leave Travel assistance/ concession
Not to exceed the amount payable by Central Government to its employees
10(5B)
Remuneration of technicians having specialised knowledge and experience in specified fields (not resident in any of the four preceding financial years) whose services commence after 31.3.93 and tax on whose remuneration is paid by the employer
Exemption in respect of income in the from of tax paid by employer for a period upto 48 months
10(7)
Allowances and perquisites by the government to citizens of India for services abroad

10(8)
Remuneration from foreign governments for duties in India under Cooperative technical assistance programmes. Exemption is provided also in respect of any other income arising outside India provided tax on such income is payable to that Government.

10(10)
Death-cum-retirement Gratuity-

(i) from Government


(ii) Under payment of Gratuity Act 1972
Amount as per Sub-sections (2), (3) and (4) of the Act.

(iii) Any other
Upto one-half months salary for each year of completed service.

10(10A)
Commutation of Pension-

(i) from government, statutory Corporation etc.


(ii) from other employers
Where gratuity is payable value of 1/3 pension. Where gratuity is not payable value of 1/2 pension

(iii) from fund set up by LIC u/s 10(23AAB)


10(10AA)
Encashment of unutilised earned leave

(i) from Central or State government


(ii) from other employers
Upto an amount equal to 10 months salary or Rs. 1,35,360/- which ever is less

10(10B)
Retrenchment compensation
Amount u/s. 25F(b) of Industrial Dispute Act 1947 or the amount notified by the government, whichever is less.
10(10C)
Amount received on voluntary retirement or termination of service or voluntary separation under the schemes prepared as per Rule 2BA from public sector companies, statutory authorities, local authorities, Indian Institute of Technology, specified institutes of management or under any scheme of a company or Co-operative Society
Amount as per the Scheme subject to maximum of Rs. 5 lakh
10(11)
Payment under Provident Fund Act 1925 or other notified funds of Central Government

10(12)
Payment under recognised provident funds
To the extent provided in rule 8 of Part A of Fourth Schedule
10(13)
Payment from approved Superannuation Fund

10(13A)
House rent allowance
least of-
(i) actual allowance


(ii) actual rent in excess of 10% of salary


(iii) 50% of salary in Mumbai, Chennai, Delhi and Calcutta and 40% in other places


10(14)
Prescribed [See Rule 2BB (1)] special allowances or benefits specifically granted to meet expenses wholly necessarily and exclusively incurred in the performance of duties
To the extent such expenses are actually incurred.
10(18)
Pension including family pension of recipients of notified gallantry awards

Exemptions to Non-citizens only


10(6)(i)(a) and (b)
(i) passage money from employer for the employee and his family for home leave outside India

(ii) Passage money for the employee and his family to Home country after retirement/termination of service in India.


10(6)(ii)
Remuneration of members of diplomatic missions in India and their staff, provided the members of staff are not engaged in any business or profession or another employment in India.

10(6)(vi)
Remuneration of employee of foreign enterprise for services rendered during his stay in India in specified circumstances provided the stay does not exceed 90 days in that previous year.

10(6)(xi)
Remuneration of foreign Government employee on training in certain establishments in India.

Exemptions to Non-resident Indians (NRIs) only


11.2
The units purchased by them are out of the amount remitted from abroad or from their Non-resident (External) Account

Exemptions to funds, institutions, etc.


Section
Nature of Income
Exemption limit, if any
10(14A)
Public Financial Institution from exchange risk premium received from person borrowing in foreign currency if the amount of such premium is credited to a fund specified in section 10(23E)

10(15)(iii)
Central Bank of Ceylon from interest on securities

10(15)(v)
Securities held by Welfare Commissioners Bhopal Gas Victims, Bhopal from Interest on securities held in Reserve Banks SGL Account No. SL/DH-048

10(20)
any local Authority
(a) Business income derived from Supply of water or electricity any where. Supply of other commodities or service within its own jurisdictional area.
(b) Income from house property, other sources and capital gains.


10(20A)
Housing or other Development authorities

10(21)
Approved Scientific Research Association

10(23)
Notified Sports Association/ Institution for control of cricket, hockey, football, tennis or other notified games.

10(23A)
Notified professional association/institution
All income except from house property, interest or dividends on investments and rendering of any specific services
10(23AA)
Regimental fund or Non-public fund

10(23AAA)
Fund for welfare of employees or their dependents.

10(23AAB)
Fund set up by LIC of India under a pension scheme

10(23B)
Public charitable trusts or registered societies approved by Khadi or Village Industries commission

10(23BB)
Any authority for development of khadi or village industries

10(23BBA)
Societies for administration of public, religious or charitable trusts or endowments or of registered religious or charitable Societies.

10(23BBB)
European Economic Community from Income from interest, dividend or capital gains

10(23BBC)
SAARC Fund

10(23C)
Certain funds for relief, charitable and promotional purposes, certain educational or medical institutions

10(23D)
Notified Mutual Funds

10(23E)
Notified Exchange Risk Administration Funds

10(23EA)
Notified Investors Protection Funds set up by recognised Stock Exchanges

10(23FB)
Venture capital Fund/ company set up to raise funds for investment in venture Capital undertaking
Income from investment in venture capital undertaking
10(23G)
Infrastructure capital fund, or infrastructure capital company
Income from dividend, interest and long term capital gains from investment in approved infrastructure enterprise
10(24)
Registered Trade Unions
Income from house property and other sources
10(25)(i)
Provident Funds
Interest on securities and capital gains from transfer of such securities
10(25)(ii)
Recognised Provident Funds

10(25)(iii)
Approved Superannuation Funds

10(25)(iv)
Approved Gratuity Funds

10(25)(v)
Deposit linked insurance funds

10(25A)
Employees State Insurance Fund

10(26B)(26BB) and (27)
Corporation or any other body set up or financed by and government for welfare of scheduled caste/ scheduled tribes/backward classes or minorities communities

10(29)
Marketing authorities
Income from letting of godown and warehouses
10(29A)
Certain Boards such as coffee Board and others and specified Authorities

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