Interest on Income Tax Refund

[Dinesh Sagade]

Interest on income tax refund .. is it taxable...if so.. under which head ? As income tax along with its interest is disallowed specifically..logically & acco. to matching concept interest on refund of income tax should be exempted...is it right ?

[Srinivas K]

Income Tax Act provides that only the Interest on Income tax refunds is taxable. It comes  under the head Income from other sources.

Srinivas

Artha Tax Consulting, Chennai

[Vivek Harsh]

It will be taxable under the head "Income From Other Source"

AI Summary

Taxability of interest on income tax refunds confirmed as taxable, treated under income from other sources. Interest on income tax refunds is taxable and must be reported as Income From Other Sources; it is not treated as an exempt recovery or adjustment to tax expense under matching or disallowance principles.