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    What is Section 10 of the Income Tax Act?

    Last Updated On 23-03-2023

    Section 10 of the Income Tax Act is meant for salaried individuals. This section's provisions aim to reduce total taxable income by covering salary components such as rent allowance, travel allowance, gratuity, etc. If you are a salaried employee and want to learn about the tax benefits available to you under this section, keep reading.

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    List of Exemptions Under Section 10

    The list of deductions under section 10 is extensive, as are the provisions contained within it. As such, we have selected the most important ones and have provided brief information related to them.

    • Section 10(1)

      Section 10(1) is about agricultural income. This section defines agriculture income as earnings from the sale of agricultural products, earnings from the farmhouse, and income from agricultural operations such as tilling, cultivation, and sowing.
    • Section 10(2)

      This section's provisions apply to any amount received from family income. It also deals with earnings from impartible assets and the income derived by a HUF member from the family estate.
    • Section 10(2a)

      This section states that any income made by any partner of a limited liability partnership or a partnership firm from the firm's total earnings is tax-free. The primary objective of this section is to avoid double taxation.
    • Section 10(4)

      If you are a non-resident Indian (NRI), you can get a tax exemption on the interest income from bonds, NRE bank accounts, and so on. However, you will find various conditions attached to this section that must be met in order to receive tax benefits.
    • Section 10(5)

      This section deals with the travel concession allowance. Under this, the allowance provided by your employer is exempt if you spend it on travelling through public transport like railway, airways, or bus. In case you spend it on hotel reservations, food, or other things, you won't get any tax benefit under this section.
    • Section 10(6)

      Income tax section 10(6) provides an exemption if you work in a foreign nation but are representing India in that country. The section will be applicable to you if you fall under any of the following categories.
      • High Commission
      • Embassy
      • Individuals employed in a foreign ship
      • Trade commissioner
      Not only that, but you can get tax breaks under this section if you work for a foreign company that does not have a presence in India. Another requirement as an employee of a foreign company is that your stay in India does not exceed 90 days.

       

    • Section 10(7)

      You can receive tax benefits under this section if you are employed with the government. This section states that any allowance or perquisite provided to a government employee for performing services outside of India is tax-free.
    • Section 10(14)(1)

      According to this section, any allowance that you receive from your employer to meet the expenses necessary for performing your duties is exempt from taxes. Go through the pointers below to learn more about allowances exempt under this section.
      • Travel allowance provided by your employer to cover travel expenses related to an official tour or transfer.
      • Conveyance allowance provided by your employer to cover transportation costs incurred while performing office-related duties.
      • A uniform allowance is provided to help you buy or maintain your official uniform.
      • Daily allowance provided by your employer to cover the necessary expenses for performing official duties while away from your regular place of work.
      • Some employers also provide research allowances for academic training, encourage research, and so on. Such an allowance is exempt from tax.

    Conclusion

    Section 10 of the Income Tax Act also includes provisions for tax breaks on life insurance policies (Section 10(10D)) and statutory provident funds (Section 10(11)). There are numerous other subsections that can help you reduce your tax liability. As a result, it is recommended that you pay close attention to this section when filing your ITR. You can also use an online tax calculator to make the calculation process appear simple. 

    To know more, please read the relevant articles at our website PNB MetLife.

    Disclaimer:

    The aforesaid article presents the view of an independent writer who is an expert on financial and insurance matters. PNB MetLife India Insurance Co. Ltd. doesn’t influence or support views of the writer of the article in any way. The article is informative in nature and PNB MetLife and/ or the writer of the article shall not be responsible for any direct/ indirect loss or liability or medical complications incurred by the reader for taking any decisions based on the contents and information given in article. Please consult your financial advisor/ insurance advisor/ health advisor before making any decision.

    PNB MetLife India Insurance Company Limited Registered office address: Unit No. 701, 702 & 703, 7th Floor, West Wing, Raheja Towers, 26/27 M G Road, Bangalore -560001, Karnataka
    IRDAI Registration number 117 | CIN U66010KA2001PLC028883
    Terms & conditions apply, Benefits stipulated are subject to premiums paid and policies in-force. For more details on risk factors, please read the sales brochure and the terms and conditions of the policy, carefully before concluding the sale.
    Tax benefits are as per the Income Tax Act, 1961, & are subject to amendments made thereto from time to time. Please consult your tax consultant for more details.
    Goods and Services Tax (GST) shall be levied as per prevailing tax laws which are subject to change from time to time.
    The marks "PNB" and "MetLife" are registered trademarks of Punjab National Bank and Metropolitan Life Insurance Company, respectively. PNB MetLife India Insurance Company Limited is a licensed user of these marks.
    Call us Toll-free at 1-800-425-6969, Phone: 080-66006969, Website: www.pnbmetlife.com, Email: indiaservice@pnbmetlife.co.in or Write to us: 1st Floor, Techniplex -1, Techniplex Complex, Off Veer Savarkar Flyover, Goregaon (West), Mumbai – 400062, Maharashtra. Phone: +91-22-41790000, Fax: +91-22-41790203.

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    IRDAI is not involved in activities like selling insurance policies, announcing bonus or investments of premium. Public receiving such phone calls are requested to lodge a police complaint.

    AD-F/2022-23/434  

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