Income Tax

Practical guides to returns, tax audit, assessments and notices.

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Income Tax

485 articles

Foreign Tax Credit: Rule 76 and Forms 44–452026-10-23

Foreign Tax Credit in Tax Year 2026–27: Form 44, the ₹1 Lakh Verification Test and Form 45 Disputes

Rule 76 introduces a current-year documentation framework using Forms 44 and 45. Understand the company and ₹1 lakh accountant-verification triggers, source-wise caps, filing dates, foreign disputes and refunds.

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India-US DTAA; Article 15; independent professionals; fixed base; 90-day test2026-10-23

India–US DTAA Article 15: Independent Professionals, the 90-Day Test and a Regularly Available Fixed Base

An eligible US-resident independent professional does not use the treaty’s company service-PE rule. Apply Article 15’s alternative fixed-base and 90-day tests, identify the relevant taxable year and separate Indian-performed services from unrelated fees.

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India-US DTAA; Article 24; limitation on benefits; ownership and base erosion2026-10-23

India–US DTAA Article 24: Share-Class Ownership, Base Erosion and Treaty-Eligibility Evidence

A US tax-residence certificate does not complete treaty eligibility. Build an Article 24 file covering the more-than-50% test for every share class, indirect owners, income-use analysis and alternative routes to benefits.

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Section 131 continuing home-loan interest and section 22 allocation2026-10-23

First-Home Loan Interest in 2026–27: Section 131, Old Sanctions and No Double Deduction

A qualifying 2019–2022 home-loan sanction can still support section 131 deductions in 2026–27. Verify stamp duty value, first-house status and regime eligibility, then allocate interest without duplicating section 22.

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Section 123 life-insurance premiums and Schedule XV limits2026-10-23

Life-Insurance Premium Deduction in 2026–27: Section 123, Sum-Assured Limits and the Shared Cap

Compute eligible life-insurance premiums policy by policy before applying section 123’s shared cap. The issue date, insured relationship, actual capital sum assured and tax regime can each change the deduction.

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Employer NPS deduction: section 124 salary caps and perquisite review2026-10-23

Employer NPS Contributions in Tax Year 2026–27: Section 124, the 10%/14% Limits and ₹7.5 Lakh Review

An employer’s qualifying pension contribution has its own deduction under section 124. Calculate it using the correct employer class, employee tax regime and salary base, then separately test the aggregate employer-contribution perquisite; a 14% deduction is not a blanket tax-free cap.

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Voluntary retirement compensation: section 19 and Rule 202026-10-23

VRS Compensation in Tax Year 2026–27: Section 19 Deduction, Rule 20 Eligibility and the ₹5 Lakh Cap

An eligible VRS payment can attract a salary deduction of up to ₹5 lakh under the Income-tax Act, 2025. Test the employer, scheme, employee conditions and previous relief before applying the cap; an exit payment does not qualify merely because payroll calls it VRS.

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Commuted pension: section 19 salary deductions2026-10-23

Commuted Pension in Tax Year 2026–27: Section 19, Full-Pension Value and the Gratuity Test

For an ordinary non-government employer’s pension scheme, the deduction is based on the commuted value of one-third of normal pension where gratuity was received, or one-half otherwise. Reconstruct the full-pension value correctly and distinguish qualifying full-deduction schemes from regular pension receipts.

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Electric vehicle loan interest: section 1322026-10-23

EV Loan Interest in Tax Year 2026–27: Continuing Section 132 Deductions After the Sanction Window

An eligible EV loan sanctioned between 1 April 2019 and 31 March 2023 can still support an interest deduction in tax year 2026–27. Apply the ₹1.5 lakh annual cap, the statutory vehicle and lender tests, and the tax-regime restriction before claiming.

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Patent royalties: section 152 and Forms 37/382026-10-23

Patent Royalty Deduction in 2026–27: Section 152, Inventor Eligibility and Forms 37/38

Section 152 can deduct up to ₹3 lakh of qualifying patent-royalty income for a resident individual inventor. Check the patent date, statutory patentee definition, compulsory-licence terms, foreign-remittance evidence and tax regime; a patent purchaser or product seller does not qualify merely by owning patent rights.

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Specified Disease Medical Treatment Deduction2026-10-22

Specified-Disease Medical Deduction in 2026–27: Section 128 Caps, Reimbursements and Rule 62

Calculate prescribed medical-treatment deductions in the correct order: actual payment, patient-based ceiling and reimbursement reduction. Verify the regime and current specialist prescription.

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Residential Rent Deduction and Form 312026-10-22

Rent Paid Without HRA in 2026–27: Section 134, the Three Deduction Limits and Form 31

Calculate the current residential rent deduction using the income, monthly and rent-excess limits. Check the regime, HRA, property ownership and Form 31 before claiming it.

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