1. Casual Income Taxation: Under Section 115D, casual
income, such as lottery winnings, crossword puzzles, card
games, gambling, and betting, is taxed at a flat rate of
30%. No deductions or shifting benefits can be claimed for
this special rate income. A rebate under Section 87A is
available if the taxpayer's total income is less than or equal
to INR 5 lakh.
2. Share Premium in Excess of Fair Market Value: The
amount received for share capital from a resident
shareholder in excess of the fair market value is taxable as
income from other sources (IFOS). This taxation does not
apply to listed companies or non-resident shareholders.
3. Interest on Compensation or Enhanced Compensation:
Interest received on compensation or enhanced
compensation (where the government has paid the
compensation late) is taxable in the year of receipt, after
taking a 50% standard deduction.
4. Capital Gains Tax on Gifts: Gift income, such as cash,
property, or assets received without consideration or for
inadequate consideration, is taxable if the value exceeds
INR 50,000 in a year. This taxation applies to sums of
money, movable property, immovable property, and
removable property received without or with inadequate
consideration. Gifts from certain relatives or under specific
circumstances, such as marriage, inheritance, wills, local
authorities, or registered trusts, are exempt from taxation.
5. Cost of Acquisition and Fair Market Value:
Understanding the difference between the cost of
acquisition and fair market value is crucial in determining
the taxability of certain transactions.
income, such as lottery winnings, crossword puzzles, card
games, gambling, and betting, is taxed at a flat rate of
30%. No deductions or shifting benefits can be claimed for
this special rate income. A rebate under Section 87A is
available if the taxpayer's total income is less than or equal
to INR 5 lakh.
2. Share Premium in Excess of Fair Market Value: The
amount received for share capital from a resident
shareholder in excess of the fair market value is taxable as
income from other sources (IFOS). This taxation does not
apply to listed companies or non-resident shareholders.
3. Interest on Compensation or Enhanced Compensation:
Interest received on compensation or enhanced
compensation (where the government has paid the
compensation late) is taxable in the year of receipt, after
taking a 50% standard deduction.
4. Capital Gains Tax on Gifts: Gift income, such as cash,
property, or assets received without consideration or for
inadequate consideration, is taxable if the value exceeds
INR 50,000 in a year. This taxation applies to sums of
money, movable property, immovable property, and
removable property received without or with inadequate
consideration. Gifts from certain relatives or under specific
circumstances, such as marriage, inheritance, wills, local
authorities, or registered trusts, are exempt from taxation.
5. Cost of Acquisition and Fair Market Value:
Understanding the difference between the cost of
acquisition and fair market value is crucial in determining
the taxability of certain transactions.
