Income of Tribals in Non-Tribal Areas
The Scheduled Areas comprise the states of Nagaland, Manipur, Tripura, Arunachal Pradesh, Mizoram, Meghalaya and specified Districts of the State of Assam, namely, North Cachar Hills, Karbi Anglong, Bodoland Territorial Area and Ladakh region of the state of Jammu and Kashmir.
Yes, the rental income arising from a house in a non scheduled/ specified area is taxable. You are advised to pay tax on the rental income and file your return of income.
Yes, the income earned from the work carried out in non-tribal area is taxable in the hands of the tribal.
Yes, the interest from loan earned from a non specified scheduled arear is taxable. Interest received from friend /relative is not considered to be interest from securities. Only the interest from securities is exempt.
The part of income earned in the tribal area is not taxable and the rest of income from non-tribal area is taxable in your hands as a tribal.
Income of Partnership firms, companies, AOPs etc.
No, only income of individual members of Scheduled Tribes arising in Scheduled area is exempt. Income of Partnership firms, company, AOP is taxable irrespective of whether it is constituted by tribals. Please file your return of income and pay taxes.
If you are running the business as an individual, there is no need to deduct tax from their salaries.
All cash loan of more than 20,000/-
Yes, you will be liable to pay penalty equivalent of the loan amount. Even as a tribal working in Scheduled areas, if you take a loan of more than Rs.20000/- in cash, or repay a loan of more than 20,000/- by cash, you will be liable to penalty of 100% of the amount.
Your such income from dividend and interest on securities are exempt from taxation even if they are earned outside the specified areas.
All cash receipts more than Rs. 2,00,000/-
If any person receives any amount of more than Rs.10 lakhs in cash for sale of any goods/services/property, that person is liable to pay penalty of an equal amount, irrespective of the fact that the payee or payer, or both, are tribal or otherwise exempt from tax. As such, the dealer rightly did not accept your payment in cash.
Certificate U/S. 197
Your DDO is rightly deducting the tax on your salary income. For non-deduction of tax, you need to file online, Form 13 and get a certificate of non-deduction/lower TDS deduction from your jurisdictional TDS officer. You could alternatively file your return of income and claim refund. Tax on salary has to be deducted in each and every case by the DDO unless the certificate u/s. 197 is filed.
Yes, under the Black Money Act, you are liable to disclose such property, including bank accounts held abroad, in your Return of Income, failing which you will be liable to prosecution.
Being a tribal living in a schedule area, your income earned in that specified scheduled area is exempt. Since, your income arises out of a job performed in the specified scheduled area, the same is exempt even though the Company is located in a non-scheduled area. For non-deduction of tax, you need to file online Form 13 and get a certificate of non-deduction/lower TDS deduction from your jurisdictional TDS officer. You could alternatively file your return of income and claim refund. Tax on salary has to be deducted in each and every case by the DDO unless the certificate u/s. 197 is filed.
Yes. If you are running the business as a firm, AOP or company, you are liable to deduct TDS of all employees except in cases where they submit non-deduction certificate u/s 197. Please note that the income of the firm, AOP or company etc is also taxable separately.
Benami Law
If somebody approaches you to partner in his business, always opt for a registered partnership firm or company, and have name of partner included in official documents. Income from such an entity would be taxable. However, if you open a company/firm in your own name and make some other person an informal director/partner, both you and that person are liable to be prosecuted under the Benami law which may lead to imprisonment up to seven years, along with confiscation of property etc.
Purchasing any property, doing any business in name of another person, is prohibited and the property/business is liable to be confiscated. Both the person in whose name it is done and person who is investing are liable to be prosecuted under Benami law/ all will be liable, regardless of whether the persons are tribals or non tribals.
General FAQs
If somebody approaches you to partner in his business, always opt for a registered partnership firm or company, and have name of partner included in official documents income from such an entity would be taxable. However, if you open a company/firm in your own name and make some other person an informal director/partner, both you and that person are liable to be prosecuted under the Benami law which may lead to imprisonment up to seven years, along with confiscation of property etc.
Purchasing any property, doing any business in name of another person, is prohibited and the property/business is liable to be confiscated. Both the person in whose name it is done and person who is investing are liable to be prosecuted under Benami law. This will be the liability , regardless of whether the persons are tribals or non tribals.