Income Tax in certain special cases- chapter XII
| Section | Heading | comments |
| 110 | Determination of tax where total income includes income on which no tax is payable. |
In such a case assessee shall be entitled to a deduction, from the amount of income-tax with which he is chargeable on his total income, of an amount equal to the income-tax calculated at the average rate of income-tax on the amount on which no income-tax is payable.] |
| 111 | Tax on accumulated balance of recognised provident fund | Accumulated balance due to an employee participating in a recognised provident fund . section 111 read with rule 8 /9(2) of Part A of the Fourth Schedule |
| 111A | Tax on short-term capital gains arising from the transfer of a short-term capital asset, being an equity share in a company or a unit of an equity oriented fund [or a unit of a business trust | Tax @ 15% if such transaction is chargeable to STT(securities transaction tax). Deduction under Chapter VI-A shall be allowed from the gross total income as reduced by such capital gains. see note-1 |
| 112 | Tax on long-term capital gains. | see note-1 |
| 112A | Tax on long-term capital gains in certain cases. | see note-1 |
| 113 | Tax in the case of block assessment of search cases. |
Tax @60% plus surcharge. |
| 115A |
Tax on dividends, royalty and technical service fees in the case of non-resident (not being a company) or of a foreign company |
Income shall be subject to special rate of tax. |
| 115AB | Tax on income from units purchased in foreign currency or capital gains arising from their transfer, of an assessee, being an overseas financial organisation | Income shall be subject to special rate of tax. |
| 115AC | Tax on income from bonds or Global Depository Receipts purchased in foreign currency or capital gains arising from their transfer to assessee, being a non-resident | Income may be interest or dividend or capital gain shall be subject to special rate of tax @10% |
| 115ACA | Tax on income from Global Depository Receipts purchased in foreign currency or capital gains arising from their transfer. | Income may be dividend or capital gain shall be subject to special rate of tax @10% |
| 115AD. | Tax on income of FII (Foreign Institutional Investors) from securities or capital gains arising from their transfer. | income received in respect of securities to FII @ 20%, other funds @10%, in the case of short term capital gain tax @ 15% if covered in section 111A, long-term capital asset referred to in section 112A@10%, other long term capital gain @ 10% |
| 115B | Tax on profits and gains of life insurance business. | Tax @ 12.5% . |
| 115BA |
Lower Tax rate on income of certain manufacturing domestic companies |
Tax @ 25% optional. company has been set-up and registered on or after the 1st day of March, 2016; if company exercises option under section 115BAA, the option under this section may be withdrawn. |
| 115BAA | Tax on income of certain domestic companies | Tax @22% ,if the conditions contained in section 115 BAA (2) are satisfied. This is optional provision. Here lower tax rate Total income computed without certain deductions, without set off of losses, without set off of any loss or allowance for unabsorbed depreciation, current year depreciation allowed except depreciation of section 32(1)(iia) |
| 115BAB | Tax on income of new manufacturing domestic companies. | Tax @15% if certain conditions are satisfied. Optional provisions. income, is neither been derived from nor is incidental to manufacturing or production of an article or thing and in respect of which no specific rate of tax has been provided separately under this Chapter, such income shall be taxed @ 22% and no deduction or allowance in respect of any expenditure or allowance shall be allowed in computing such income. company has been set-up and registered on or after the 1st day of October, 2019, and has commenced manufacturing or production of an article or thing on or before the 31st day of March, 2023 |
| 115BAC |
Tax on income of individuals and Hindu undivided family |
From AY 2021-22, optional tax rate without deduction/ exemptions etc. so tax payer may opt tax under this section or as per finance act whichever is more beneficial. |
| 115BAD | Tax on income of certain resident co-operative societies. | From AY 2021-22, optional tax @22% but Total income computed without certain deductions, without set off of losses, without set off of any loss or allowance for unabsorbed depreciation, current year depreciation allowed except depreciation of section 32(1)(iia). So co-operative societies have option either to offer tax under this section or as per finance act whichever is more beneficial. Option to be exercised before due date of ITR u/s 139(1) and option once exercised shall apply to subsequent assessment years.
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115BB |
Tax on winnings from lotteries, crossword puzzles, races including horse races, card games and other games of any sort or gambling or betting of any form or nature whatsoever |
Tax @30%. |
| 115BBA. | Tax on non-resident sportsmen or sports associations. | Tax @20%. no deduction in respect of any expenditure or allowance shall be allowed under any provision of this Act in computing the income. No need to file ITR if tax fully deducted under this section. |
| 115BBC. | Anonymous donations to be taxed in certain cases. |
Tax @ 30%. Permissible limit of Anonymous donations is ₹ 1 lakh or 5% of total donation received by the assessee whichever is higher. This provision not applicable to trust or institution created or established wholly for religious purposes/ wholly for religious and charitable purposes other than any anonymous donation made with a specific direction that such donation is for any university or other educational institution or any hospital or other medical institution run by such trust or institution. |
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115BBD |
[Tax on certain dividends received from foreign companies. | Income of an assessee, Indian company, includes any income by way of dividends declared, distributed or paid by a specified foreign company, tax on such dividend @ 15%. |
| 115BBDA | Tax on dividends received from domestic companies on or before the 31st day of March, 2020]
Note: specified assessee” means a person other than,— (i) a domestic company; or (ii) a fund or institution or trust or any university or other educational institution or any hospital or other medical institution referred to in sub-clause (iv) or sub-clause (v) or sub-clause (vi) or sub-clause (via) of clause (23C) of section 10; or (iii) a trust or institution registered under section 12A or section 12AA or section 12AB. |
Total income of a specified assessee, resident in India, includes any income in aggregate exceeding ₹ 10 lakh, by way of dividends declared, distributed or paid by a domestic company or companies on or before the 31st day of March, 2020, tax on such dividend @10%. |
| 115BBE |
Tax on income referred to in section 68 or section 69 or section 69A or section 69B or section 69C or section 69D, reflected in the return of income furnished under section 139; |
Tax @ 60%. Note: no deduction in respect of any expenditure or allowance [or set off of any loss] shall be allowed to the assessee under any provision of this Act in computing his income. |
| 115BBF | Tax on income from patent developed and registered in India | Tax @ 10%.
No deduction in respect of any expenditure or allowance shall be allowed to the eligible assessee under any provision of this Act in computing his income from patent. It is optional to the assessee, and option to be exercised on or before the due date specified under sub-section (1) of section 139 for furnishing the return of income for the relevant previous year. |
| 115BBG | Tax on income from transfer of carbon credits. | Tax@ 10%.
no deduction in respect of any expenditure or allowance shall be allowed to the assessee under any provision of this Act in computing such income. |
Note -1 : tax on long capital gain on transfer of securities under section 111A, 112,112A as under:
If Equity Shares of Listed Co. are held more than 12 months is treated as long term capital assets and on transfer of such shares Long term Capital Gain which is subject to special rate of tax.
If Equity Shares of Listed Co. are held less than 12 months is treated as short term capital assets and on transfer of such shares short term Capital Gain arise which is also subject to special rate of tax.
If Equity Shares of Unlisted Co. are held for more than 24 months is treated as Long term Capital assets and on transfer of such assets long term capital Gain arise otherwise Short term capital gain
Rate of tax on capital gain on transfer of shares:
(A) Transfer of shares of Public listed company:
- In case of transfer of long term Capital assets on which STT paid at the time of Purchase as well as sales of equity share both – LTCG exceeding 1lakh is taxable @ 10% under section 112A without given effect of proviso 1 of section 48 ( related to capital gain on transfer of shares or debentures of Indian company by using foreign currency where under 1st proviso capital gain computed in foreign currency firstly and then capital gain shall be reconverted into Indian currency) and 2nd proviso of section 48( pertaining to indexation of cost of acquisition and improvement ). In other words long term capital gain upto ₹ 1 lakh is tax free and over &above subject to tax @10% without indexation benefit and computation of capital gain in foreign currency.
- In other case LTCG is taxable @ 20% under section 112.
- In case of Transfer of Short term capital asset being equity share on which STT is paid then such capital gain shall be chargeable to tax @ 15% under section 111A.
- In other case Capital gain shall be chargeable to tax at normal rate of relevant Finance Act.
(B) Transfer of shares of unlisted company being unlisted Public Co shares & private company shares:
- In case of Transfer of Long term capital asset being unlisted co. equity share is taxable @ 20% under section 112 but if the transferor is non- resident, it is taxable @ 10% under section 112 without given effect of 1st proviso and 2nd proviso of section 48.
- In Case of Transfer of Short term capital assets being equity shares is taxable at normal Rate.
- Equity oriented mutual funds
Long term capital gain : If Equity Oriented Mutual Fund are held more than 12 month is classified as long term capital assets and capital gain on transfer of such mutual fund shall be Long term capital gain, otherwise treated as short term capital gain.
Tax Treatment
- In case transfer of long term capital asset being equity oriented mutual fund in which STT is paid on sales of such mutual fund then capital gain is taxable exceeding 1 lakh @ 10% under section 112A without given effect of proviso 1 and proviso 2 of section 48. In other words long term capital gain upto ₹ 1 lakh is tax free and over & above subject to tax @10% without indexation benefit and computation of capital gain in foreign currency.
- In other case is taxable @ 20% under section 112
Short term capital gain:
- In case of Transfer of Short term capital asset being equity share on which STT is paid then such capital gain shall be chargeable to tax @ 15% under section 111A.
- In other cases Capital gain shall be chargeable to tax at normal tax rate as per relevant finance act.
- Debt oriented mutual funds
If Debt Oriented Mutual Fund are held for more than 36 months is treated as Long term capital gain otherwise treated as short term capital gain.
Tax Treatment:
In case transfer of long term capital asset being Debt oriented mutual fund is taxable @ 20%
In case transfer of long term capital asset being Debt oriented mutual fund is taxable at normal rate.
