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CS Executive · Tax Laws and Practice · Income from Other Sources

Under the Income-tax Act, 2025, income of Rs 50,000 has already been included in a resident person's total income on the basis that it accrued to him in India. The same amount is later received by him in India. What is the treatment?

It is not included again. Under section 5(4) of the Income-tax Act, 2025, income already taxed on the basis that it accrued or arose cannot be taxed once more when it is received in India, which avoids double inclusion.

  1. AIt is included again on receipt
  2. BIt is not included again on the basis of receiptCorrect
  3. CIt is included again only if he is non-resident
  4. DIt is included again at half the amount

Explanation

Section 5(4) says that if income has been included in total income on the basis of accrual or deemed accrual, it shall not again be included on the basis of receipt in India. This prevents double taxation of the same income. Hence including it again is wrong.

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