Agricultural income refers to income generated from agricultural sources and is fully exempt from income tax under section 10(1) of the Income Tax Act of 1961. Agricultural income includes (1) rent or revenue from agricultural land in India, (2) income from cultivating agricultural land or processing agricultural produce to make it marketable, and (3) income from the sale of agricultural produce. Some examples of agricultural income include income from the sale of replanted trees, rent received for agricultural land, and income from growing flowers and creepers.

1. AGRICULTURAL INCOME
INCOME TAX ACT - 1961

2. Agricultural Income
The Income which received from
Agriculture source is called
Agricultural Income.

3. Definition U/S 2(IA)
• Agricultural Income Is Fully Exempted as
per Income Tax Act 1961 U/S 10(1)
Agricultural Income includes the
following
(a).Any Rent or Revenue derived from
Agricultural Land situated in India

4. (b) Any Income From
(i) Cultivation of Agricultural Land
(ii) a process carried on to make the
produce or rent in kind marketable.
(iii) From sale of Agricultural produce

5. (c) Income From Agricultural House
property

6. TYPES OF
AGRICULTURAL INCOME
1. RENT OR REVENUE
2. CULTIVATION OF LAND
3. INCOME FROM A PROCESS
4. INCOME FROM SALE OF
PRODUCE
5. INCOME FROM LET OUT
AGRICULTURAL H OUSE
PROPERTY

7. TESTS TO DETERMINE AGRI
INCOME
• INCOME IS DERIVED FROM
LAND

8. LAND MUST BE USED FOR
AGRICULTURE PURPOSE

9. LAND MUST BE
SITUATED IN INDIA

10. Agricultural Incomes
• (a) Income from sale of replanted trees.
• (b) Rent received for agricultural land.
• (c) Income from growing flowers and
creepers.
• (d) Share of profit of a partner from a firm
engaged in agricultural operations.
• (e) Interest on capital received by a
partner from
• a firm engaged in agricultural
operations.
• (f) Income derived from sale of seeds.

11. Non Agricultural Incomes
• (a) Income from poultry farming.
• (b) Income from bee hiving.
• (c) Income from sale of spontaneously
grown trees.
• (d) Income from dairy farming.
• (e) Purchase of standing crop.
• (f) Dividend paid by a company out of its
agriculture income.

12. (g) Income of salt produced by
flooding
(h) Royalty income from mines.
(i) Income from butter and cheese
making.
(j) Receipts from TV serial shooting
in farm house is not agriculture
income.