Section 115BBF of ITA, 1961 : Section 115Bbf: Tax On Income From Patent

Explanation using Example

Let's consider Dr. Rao, a resident of India, who has developed a new pharmaceutical compound and has registered the patent in India. In the financial year, he earns INR 5,00,000 as royalty from a company for the use of his patent. Dr. Rao decides to take advantage of Section 115BBF of the Income-tax Act, 1961.

Under this section, Dr. Rao's royalty income will be taxed at a concessional rate of 10%. So, the tax on his royalty income would be INR 50,000 (10% of INR 5,00,000). Additi...

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