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Question ID : 40653

Income tax on lump sum amount received by Advocate.

An advocate, super senior citizen, received a substantial amount in lump sum from 'Advocate Welfare Fund' upon permanently stopping his legal practice. Whether that amount is liable to income tax. If so, the said amount is to be offered under which 'head of income'.

Posted by B.CHACKRAPANI WARRIER on May 20, 2020

Filed Under DIRECT TAXES

Answer ID : 80533

Since this fund is created as a welfare scheme like PF distribution from recognized PF for employees. Hence this should be exempt provided advocate has been in practice for minimum 5 years. I don't have reference of specific section which provides exemption.

Posted by CA Yogesh Kumar on May 23, 2020