Items that always form a part of Profits and Gains of Business or Profession

Certain items that form part of Profits and Gains of Business or Profession (herein referred to as PGBP)

As per section 28 of the Income Tax Act, 1961, this is a list of incomes that are always a part of PGBP:-

• Profit on sale of import entitlement license
• Cash compensatory support or duty drawback
• Profit on sale of Duty Entitlement Passbook Scheme (DEPB) or Duty Free Replenishment Certification (DFRC) (These are not operational now a days)
•  Any amount received under Keyman Insurance Policy
• Any gift/ benefit/ perquisite arising due to business or profession
• Any interest, salary, bonus, commission received by partner from partnership firm to the extent allowed under section 40(b) to the firm
• Non-compete fees (fees for not carrying out any activity in relation to any business or profession or not sharing any know-how, patent, copyright, trademark etc.)
• Income derived by a trade, professional or similar association from specific service performed to its member
• Fair Market Value of inventory as on the date on which it is converted into Capital Asset
• Any compensation or other payment due to or received by, any person, at or in connection with the termination or modification of the terms and conditions, of any contract relating to its business

So, this is a list of almost all the incomes (not an exhaustive list) that form part of PGBP, except Speculation Business. I will be posting a separate blog for the same.