Section 115E of Income Tax Act for AY 2023-24

Section 115E of Income Tax Act 1961 amended by Finance Act 2022 and Income-tax Rules. Tax on investment income and long-term capital gains.

Amended and updated notes on section 115E of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to tax on investment income and long-term capital gains.

Chapter XII-A (Sections 115C to 115-I) of the Income Tax Act 1961 deals with the provisions related to special provisions relating to certain incomes of non-residents. Section 115E of IT Act 1961-2023 provides for tax on investment income and long-term capital gains.

Recently, we have discussed in detail section 115D (Special provision for computation of total income of non-residents) of IT Act 1961. Today, we learn the provisions of section 115E of Income-tax Act 1961. The amended provision of section 115E is effective for financial year 2022-23 relevant to the assessment year 2023-24.

In this article, you will learn detail of the provisions of section 115E of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962, regulations, notifications, circulars, orders and Press Release by CBDT, Income Tax Department and the Ministry of Law and Justice, Government of India.

Section-115E: Tax on investment income and long-term capital gains

Where the total income of an assessee, being a non-resident Indian, includes—

  • (a) any income from investment or income from long-term capital gains of an asset other than a specified asset;
  • (b) income by way of long-term capital gains,

the tax payable by him shall be the aggregate of—

  • (i) the amount of income-tax calculated on the income in respect of investment income referred to in clause (a), if any, included in the total income, at the rate of twenty per cent;
  • (ii) the amount of income-tax calculated on the income by way of long-term capital gains referred to in clause (b), if any, included in the total income, at the rate of ten per cent; and
  • (iii) the amount of income-tax with which he would have been chargeable had his total income been reduced by the amount of income referred to in clauses (a) and (b).


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