GK
TAXES IN INDIA
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Land is situated in India
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Land is situated in any rural area India
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Land is situated whether in India or outside India.
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None of these
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Detailed explanation-1: -As per section 10(1), agricultural income earned by the taxpayer in India is exempt from tax. Agricultural income is defined under section 2(1A) of the Income-tax Act.
Detailed explanation-2: -If a farmer’s income is less than Rs. 5, 000 or if the total income minus the agricultural income is less than the basic exemption limit which is Rs. 2.5 lakh for a person below the age of 60 years and Rs. 3 lakh for an individual aged 60 years and above, then the income generated will be exempted from being taxed.
Detailed explanation-3: -In India, agricultural income refers to income earned or revenue derived from sources that include farming land, buildings on or identified with an agricultural land and commercial produce from a horticultural land. Agricultural income is defined under section 2(1A) of the Income Tax Act, 1961.
Detailed explanation-4: -However, in the case of a farm house, the annual value would be deemed agricultural income and thus, be exempt from tax. In addition to the above, income derived from saplings or seedlings grown in nursery is also considered as agricultural income.