In India, at the same time as most groups are subject to taxation beneath the profits Tax Act, certain varieties of corporations or income streams can also experience tax exemptions or special blessings, successfully making them “tax-unfastened” or notably lowering their tax legal responsibility.
1. Agricultural profits
Profits earned from agricultural sports is exempt from income tax beneath section 10(1) of the earnings Tax Act. This consists of profits from cultivation of crops, farming, horticulture, dairy farming, or any agricultural operation on land located in India. But, the earnings must certainly arise from agricultural land, and non-agricultural commercial enterprise earnings will still be taxable.
2. Small companies under Presumptive Taxation
Small companies with turnover up to Rs 2 crore (for GST) and profits as much as Rs 50 lakh can opt for presumptive taxation schemes (phase 44AD) that provide simplified tax compliance with a flat tax charge, occasionally resulting in lower universal tax liability. At the same time as now not completely tax-free, it reduces the burden appreciably.
3. Non-income groups (ngos/Trusts)
Registered charitable trusts, ngos, and societies engaged in charitable, non secular, or educational sports can be exempt from earnings tax under Sections eleven and 12, furnished they practice their profits toward charitable purposes and follow the applicable policies.
4. Startups beneath Tax holiday Schemes
Eligible startups identified by means of the government can revel in a three-year tax holiday on earnings for the first 7 years under phase eighty-IAC, efficaciously making their profits tax-loose throughout this era.
5. Exports and SEZ groups
Units operating in unique financial Zones (sezs) and companies earning income from exports may also get tax exemptions or blessings to promote foreign exchange.
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While maximum agencies are taxable, agricultural earnings, charitable trusts, sure startups, and SEZ units revel in tax exemptions or incentives. Expertise eligibility and compliance is fundamental to benefiting from those provisions.
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