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CMA Intermediate · Direct and Indirect Taxation · Income from Other Sources

Under the Income-tax Act, 2025, how many heads of income are provided for classifying all incomes for the charge of income-tax and computation of total income, and which of these is the residual head?

There are five heads of income under section 13 of the Income-tax Act, 2025: Salaries, House property, Business or profession, Capital gains and Income from other sources. The last head, Income from other sources, is the one that catches incomes not falling under the earlier heads.

  1. AFour heads; Income from other sources is the fourth head and covers only interest
  2. BFive heads; Income from other sources is the last of the fiveCorrect
  3. CSix heads; Income from other sources follows Capital gains and Agricultural income
  4. DFive heads; Capital gains is the last of the five

Explanation

Section 13 lists five heads: Salaries, Income from house property, Profits and gains of business or profession, Capital gains, and Income from other sources. Income from other sources is the fifth and last head. Agricultural income is not a separate head, and the head is not limited to interest.

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