Any author who earns royalty income can claim deductions under section 80QQB. The taxpayer can only claim the deduction under this section if he/she satisfies the following conditions: -
- The taxpayer must be the resident of India and he/she can be an Indian citizen or a foreign citizen.
- The taxpayer can be an author or a joint author of a literary work.
- If the taxpayer has authored a book which is a work of literary, artistic or scientific nature.
- Books written should not be a diary, brochure, journal, magazine, newspapers, text book, guide, pamphlet etc.
- The Gross Total Income of the taxpayer should include such royalty income.
- The taxpayer should collect a certificate Form 10CCD of Royalty from the Royalty Payer.
- A taxpayer can claim deductions under section 80QQB only by filing Income Tax Returns.
The amount that can be claimed as deduction
- Deduction when Royalty is received in Lump sum
If the royalty received by the taxpayer is in lump sum, then the amount can be claimed for deduction.
- Deduction when Royalty is not received in Lump Sum
If the royalty received by the taxpayer is not in lump sum, then the taxpayer can claim the royalty income or 15% of the value of the books whatever is less.
The maximum amount under section 80QQB, which can be claimed as deduction is Rs. 3,00,000.
When a Taxpayer receives Royalty from Abroad.
If the Royalty is received from abroad, the remittance must be received within 6months from the end of the financial year. If the remittance is received after 6months, then the taxpayer cannot claim deductions.
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