Are Farmers Exempt from Income Tax?
, Income tax payer. Farmers fall in two categories.Those who have mainly income from agricultural activities and those whose is agricultural activities ancillary. Thus as per Finance Acts each year their income is computed for Income tax 1961.
Are there any plans to tax agricultural income?
Any proposal to tax agricultural income will require the consent of the state governments. Given the political sensitivity, however, the states have been reluctant to tax this sector. The intent to broaden the base, check tax avoidance and to tax the ‘rich farmers’ while sparing the poor is well accepted.
Are there any income tax slabs for farmers in India?
In other words, most farmers or individuals earning their majority income from farms in India will not come under income tax net given the current income tax slabs of no income tax for income up to Rs 2.5 lakh.
How does farm income affect your income tax?
4. Farm income averaging: Regular income averaging has gone by the boards, but farmers may still average all or some of the current year’s farm income by allocating it to the three prior years. This may lower tax for the current year tax if current income from farming is high and taxable income from one or more of the three prior years was low. 5.
