Income Tax: These 10 types of income are not taxable in India; Knowing this can help you with your tax planning

All salaried individuals in the country are required to pay income tax on their specified earnings. As responsible and law-abiding citizens, everyone must file their taxes correctly and on time. The taxes paid by citizens are used to run public services and the government machinery efficiently. Therefore, every individual must file their Income Tax Return (ITR) on time and in the correct manner.

The last date to file ITR for the year 2025 is 15th September 2025. Hence, taxpayers should prepare in advance and file their returns before the deadline. But do you know that there are some types of income in India that are not taxable?

Let’s take a look at 10 such types of income that are exempt from income tax

1) Agricultural Income

As per the Indian Income Tax Act, 1961, income earned from agriculture is completely tax-free. You can mention it in the ITR and claim the exemption accordingly.

2) Gratuity

Gratuity received by government employees up to ₹20 lakhs is tax-free.
For private sector employees, the tax-free limit is up to ₹10 lakhs.

3) Interest on Savings Account

If the interest earned on a savings account is less than ₹10,000 in a financial year, it is exempt from tax.

4) Share in Partnership Firm

The profit share received by a partner in a partnership firm is not taxable in the hands of the individual partner.

5) Long-Term Capital Gains (LTCG)

If shares or equity mutual funds are held for more than one year, then the gains from selling them are tax-free under Section 10(36) (subject to specific conditions and limits).

6) Senior Citizen Saving Scheme

The principal amount invested in the Senior Citizen Saving Scheme is exempt from tax, but the interest earned on it is taxable.

7) Voluntary Retirement Scheme (VRS)

The amount received up to ₹5 lakhs under VRS is tax-free.
Also, gifts received from relatives or on the occasion of marriage are tax-exempt.

8) Provident Fund (PF) Account

Contribution to PF up to 12% of the basic salary is exempt from tax.
If the contribution exceeds this limit, the excess may be taxable.

9) Scholarship and Awards

Scholarships and awards received for education are fully tax-exempt under Section 10(16).

10) Allowance for Government Employees Posted Abroad

If a government employee is posted outside India and receives an allowance, it is completely tax-free under Section 10(7).

Conclusion

Understanding the nature of your income before filing ITR is important. The above information will help you with proper tax planning and will prevent you from paying more tax than necessary.