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NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Concepts in Taxation

Mr. Raman Iyer, a resident individual, receives the following in a year: salary Rs 9,00,000 (taxable), agricultural income from land in Tamil Nadu Rs 2,00,000, and interest on a savings bank account Rs 10,000. Which of these is exempt from inclusion in his total income under the basic scheme of taxation, apart from any deduction?

Agricultural income of Rs 2,00,000 from land in India is excluded from total income and is not taxed as such, though it may be considered for rate purposes in specified cases. Salary and savings interest are taxable under their respective heads.

  1. ASalary of Rs 9,00,000
  2. BAgricultural income of Rs 2,00,000 (though it may be considered for rate purposes in specified cases)Correct
  3. CSavings bank interest of Rs 10,000
  4. DNone of the three amounts is exempt

Explanation

Agricultural income from land in India is not charged to tax as it is excluded from total income. Salary and bank interest are taxable heads (deductions like 80TTA apply only under the old regime and are deductions, not exemptions). Hence agricultural income is the exempt item.

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