Section 92: income from other sources

The residuary rule

Any income of any kind that is not excluded from total income under the Act, and is not chargeable under any of the other four heads of income listed in Section 13(a) to (d), is chargeable to tax under the head "Income from other sources."

Specific incomes always taxed under this head

Section 92(2) lists categories of income taxed under this head, without limiting the general residuary rule above:

• Any dividend
• Winnings from lotteries, crossword puzzles, races (including horse races), card games and other games of any sort, or from gambling/betting of any form
• Employee contributions received by the assessee for provident fund, superannuation fund, ESI fund, or similar employee welfare funds (if not taxable as business income)
• Sums received under a Keyman insurance policy, including allocated bonus (if not taxable as business income or salary)
• Interest on securities (if not taxable as business income)
• Income from letting machinery, plant or furniture on hire (if not taxable as business income)
• Income from letting machinery/plant/furniture together with buildings where the letting is inseparable (if not taxable as business income)
• Money received as an advance or otherwise during negotiations to transfer a capital asset, where that sum is forfeited and the negotiations do not result in a transfer
• Interest received on compensation or enhanced compensation for compulsory acquisition
• Compensation or other payment received in connection with termination of employment, or modification of its terms
• A specified sum received by a unit holder from a business trust, computed by a formula that nets out amounts already taxed or excluded
• Sums (including bonus) received under a life insurance policy that are not otherwise excluded from total income, to the extent they exceed the aggregate premiums paid and not already claimed as a deduction (excluding unit-linked policies and Keyman policies, computed in a prescribed manner)
• Money or property received without adequate consideration above certain thresholds, as detailed below

Gifts of money and property above ₹50,000

Where a person receives, in a tax year, from one or more persons: (i) any sum of money without consideration totalling more than ₹50,000, the whole sum is taxable; (ii) immovable property without consideration, where the stamp duty value exceeds ₹50,000, the whole stamp duty value is taxable; (iii) immovable property for consideration, where the stamp duty value exceeds the consideration paid by more than the higher of ₹50,000 or 10% of the consideration, the excess is taxable; (iv) other property (not immovable) without consideration, where the aggregate fair market value exceeds ₹50,000, the whole fair market value is taxable; (v) other property received for a consideration less than fair market value by more than ₹50,000, the excess is taxable.

Exceptions to the gift-taxation rule

The gift-taxation rule above does not apply to money or property received:

• From a relative (as defined in the section)
• On the occasion of the individual's marriage
• Under a will or by way of inheritance
• In contemplation of the death of the payer or donor
• From a local authority
• From or by a registered non-profit organisation (with a specific carve-out)
• By way of a transaction not regarded as a transfer under specified clauses of Section 70(1)
• From an individual, by a trust created solely for the benefit of that individual's relative
• From such other class of persons and subject to such conditions as may be prescribed

Who counts as a "relative"

For an individual, "relative" means the spouse; brother or sister; brother or sister of the spouse; brother or sister of either parent; any lineal ascendant or descendant (of the individual or of the spouse); and the spouse of any of these persons. For a Hindu undivided family, any member of the family is a relative.

Immovable property: which date's stamp duty value applies

If the agreement fixing the consideration and the registration date differ, the stamp duty value on the agreement date applies - but only if at least part of the consideration was paid through a specified banking or online mode on or before the agreement date. If the assessee disputes the stamp duty value, the Assessing Officer may refer the valuation to a Valuation Officer, applying the same procedure used for disputed stamp duty values elsewhere in the Act.

Key definitions used in this section

"Property" for the gift-taxation rule is limited to: immovable property (land or building); shares and securities; jewellery; archaeological collections; drawings; paintings; sculptures; any work of art; bullion; or a virtual digital asset. "Fair market value" of non-immovable property is determined by a prescribed method. "Lottery" includes winnings from prizes awarded by draw of lots, chance, or any scheme by whatever name called, and "card game and other game of any sort" includes game shows or television/electronic entertainment programmes involving competing for prizes.

Frequently asked questions