CAF-2 · Chapter 10 · Question 12 of 15
ABC Bank Limited’s core business is providing loans, and it earned Rs. 500 million as profit on debt during the year. Under which head of income will this amount be chargeable to tax?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) C) Income from Business
Explanation
Any profit on debt derived by a person where the person’s *business* is to derive such income (e.g., banks and financial institutions) shall be chargeable to tax under the head "Income from Business" and not under the head "Income from Other Sources".
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