Sec 10 exemptions

22 Sep 2022

There is no term like exemption from tax in the income act 1961.

Its income does not form part of total income.

These are some examples of Section 10 incomes:


1. Agricultural Income Sec 10 (1): Income that is derived from Agricultural activities. The agricultural income derived from India is not taxable but from foreign is taxable.

2. Member’s Share in HUF Sec 10(2): The income from HFU is already being taxable and tax can’t be levied more than one time on the same income.

3. Share of profit in Partnership firm Sec 10(2A): The income from Partnership firm is already being taxable and tax can’t be levied more than one time on the same income.

4. Leave travel concession Sec 10 (5): The amount paid by the employer for travel made by the employee and his family can be claimed up to whichever is less from the following:

a. Amount received from the employer.

b. Actual expenses incurred in the respect.

5. Tax paid by Government on Royalty or fees for technical services Sec10 (6A): Any payment received from the government for providing any technical fees.

6. Allowance or Perquisites paid outside India Sec 10(7): Allowance and perquisites paid to government employees serving outside India.

7. Death cum Retirement Gratuity Sec 10(10): the person who retires due to incapability or death as or after 1st April, 1988. It is fully non taxable in case of Central government employees, members of civil service and local authority employees and for other employees it is non taxable to the limit specified after satisfying some conditions.

8. Commutation of pension Sec 10(10A): Any lump sum amount in lieu of monthly pension received by an employee. It is fully non taxable in case of Central government employees, members of civil service, local authority employees, Statutory Corporation, defense service & etc and for other employees it is non taxable to the limit specified after satisfying some conditions.

9. Leave Encashment Sec 10(10AA): Any amount received for encashment of accumulated leave at the time of retirement/superannuation. It is fully non taxable in case of government employees and for other employees it is non taxable to the limit specified after satisfying some conditions.

10. Workmen’s retrenchment Compensation Sec 10(10B): Any amount received by workmen at the time of retrenchment under Industrial Act 1947.

11. Compensation under Bhopal Gas Leak disaster Act 1985 Sec10 (10BB): A Income arising out of or connected with the disaster for compensation or damages for any loss of life or personal injury.

12. Compensation on disaster Sec 10(10BC): any amount received from the State as compensation for any disaster by any individual or his legal heirs.

13. Payment under VRS Sec10 (10C): If an employee receives compensation (whether in one go or in installments) on voluntary retirement or separation.

14. Sum received under Life Insurance policy Sec10(10D): Sum received under a life insurance policy, including any sum allocated by way of bonus on such policy subject to certain exclusions.

15. Payment from Statutory provident Fund /Public Provident fund Sec 10(11): Interest credited to such fund in the hands of employee is not formed as a part of income.

16. Payment from Sukanya Samriddhi Yojana Sec 10(11A): Any payment received from the account opened in accordance with sukanya samriddhi account rule 2014.

17. Payment from Recognized Provident fund Sec 10 (12): The total balance due and has become payable to an employee participating in a Recognized provident fund.

18. House Rent Allowance Sec10 (13A): The income can be deductible to the extent mentioned in Rule 2A of Income tax Act.

19. Notified specified Allowance Sec 10 (14): Any allowances received up to Rs.100.00 per month per child are tax free.

20. Interest on Securities Sec 10 (15): Any income received from notified securities, bond or annuity (income such as interest, premium on redemption and any other).

21. Educational Scholarship Sec 10 (16): Scholarship received to meet the cost of education.

22. Daily Allowances to M.P and M.L.A Sec 10 (17): Any amount received as constituency allowance in case of M.P and M.L.A.

23. Award and Reward (Public Interest) Sec10 (17A): Any case or cash equivalent award received from the central government, State government or local bodies are not taxable.

24. Pension to receiver of Gallantry awards Sec 10 (18): The receiver of such pension to the legal hair of the deceased armed forces personnel (who has received a gallantry award, mahavir chakra, vir chakra).

25. Family pension – Widow or children of armed forces Sec 10( 19): Family pension received from the family deceased armed forces personal.

26. Income from palace of Ex-ruler Sec10 (19A): The annual value of One Palace possessed by the ex-ruler of the Indian state is not taxable, whereas the other palace are taxable.

27. Income of any resident of ladakh district Sec10 (26A): Any income arising to a resident of ladakh district from any source within the district or from outside india is not taxable.

28. Income of Sikkimese Sec10 (26AAA): The income of Sikkimese individuals which is arising within the state of Sikkim or by the way of dividend or interest on securities.

29. Income of a minor child up to 1500 Sec10 (32): Income of minor child included in the assessee’s income u/s 64(1A) to the extent it does not exceed Rs.1,500.00 per child.

30. Dividend from Domestic/Indian Company Sec 10 (34): If any individual get any dividend from any Indian company then he is not liable to pay any tax on such dividend received (only the company has to pay the Dividend distribution tax u/s 115-O).

31. Income from units Sec 10(35):

a. Administration of Specified Undertaking

b. Mutual Funds

c. Specified Companies

32. Income of Specified Organization:

a. Income of Local Authorities Sec 10 (20): Income from House property, Income from capital gain or income from supply of water & etc.

b. Income of political parties: Any income received by the political parties.

c. And many more


Abhijit Das