What is the rule 115 of Income Tax Act?

Asked by: Prof. Naomi Leannon  |  Last update: August 21, 2026
Score: 4.1/5 (27 votes)

Rule 115 of the Income Tax Rules, 1962, dictates the exchange rate for converting foreign currency income into Indian Rupees (INR) for tax purposes. It stipulates using the SBI Telegraphic Transfer Buying Rate (TTBR) on the last day of the month preceding when the income is due or received.

What is rule 115 of the Income Tax Act?

According to Rule 115, the foreign income must be converted using the Telegraphic Transfer Buying Rate (TTBR) of the State Bank of India (SBI). This rate is officially published and easily available, ensuring a fair and consistent way to calculate tax on foreign income.

What income is covered by Section 115?

Many tax laws apply differently to government entities than to other organizations and individuals. The primary tax difference from other taxpayers is the general exemption from income tax. IRC section 115 excludes from gross income any income derived from the exercise of or administration of any public function.

What is Section 115 of the Income Tax Act?

Section 115 of the Income Tax Act was introduced in 1976 as a provision to tax income earned from royalty and technical services. Royalty refers to the payment made for the use of intellectual property rights, such as patents, copyrights, and trademarks.

Who does Section 115 affect?

(a) Every person who knowingly procures or offers any false or forged instrument to be filed, registered, or recorded in any public office within this state, which instrument, if genuine, might be filed, registered, or recorded under any law of this state or of the United States, is guilty of a felony.

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What are the drawbacks of Section 115?

Being found guilty of a felony under Penal Code 115 can increase the severity of penalties faced in subsequent legal issues. If an individual is later involved in another criminal case, the felony record might influence judicial decisions, potentially resulting in harsher sentencing.

What is the new tax regime 115?

Section 115BAC of the Income Tax Act introduces the new tax regime, which offers reduced slab rates in exchange for forgoing most deductions and exemptions. Section 115BAC also has provided the option to the taxpayers to choose their most beneficial regime every financial year (subject to conditions as prescribed).

What if the dividend is more than 5000?

TDS on dividends is applicable when total dividend income during the financial year exceeds ₹5,000. TDS is deducted on dividend income at 10%, but if PAN is not provided to the paying institution, the TDS rate goes up to 20%. As we know, the tax exemption limit under the Income Tax Act begins from Rs 2.5 lakhs.

How does section 115 work?

Filing a False Document under California Penal Code Section 115 PC makes it a felony to file any forged or false document with a public office. The statute requires a prosecutor to prove the following elements: A defendant provided a document for filing, recording or registration with any public office in California.

What is Section 115A 1 A )( I of Income Tax Act?

Key Points of Section 115A(1)(a)(i)

Details: Dividends received from units located in an IFSC are taxed at a reduced rate of 10%. This concessional rate is part of the government's strategy to attract investments into IFSCs.

Which deduction is allowed in the new tax regime?

Under the new tax regime for FY 2025-26, taxpayers can claim limited deductions such as standard deduction of ₹75,000, interest on home loan under section 24(b) for let-out property and employer's contribution to NPS under section 80CCD(2),etc. No, HRA exemption u/s10(13A) is not allowed in the new tax regime.

What exchange rate to use for capital gains?

For example, when you're working out capital gains tax (CGT), you have to use spot rates on specific transaction dates, not the monthly average. In many other cases though, the Financial Times rates are enough.

How much capital gains do I pay on $100,000?

On a $100,000 capital gain, you'll likely pay 15% for long-term gains, resulting in about $15,000 in federal tax (plus potential state tax), but it could be 0% or 20% depending on your total taxable income and filing status, while short-term gains are taxed as ordinary income (potentially 22-24%). 

Does the Big Beautiful Bill get rid of capital gains tax?

Capital gains tax rates remain unchanged under the One Big Beautiful Bill Act. However, Project 2025, a policy blueprint developed by the Heritage Foundation, outlined several potential changes to capital gains taxation, including: Reducing the top long-term capital gains rate to 15%, from the current 20%

Can I transfer money to family tax-free?

“Gifts” can be made in cash or other assets – securities, closely held business interests, real estate, artworks, collectibles or any other type of property. So long as the total market value of your gifts does not exceed $19,000 per recipient in 2026, the transfers are entirely gift tax-free.

How much money can be transferred from India to the USA without tax?

According to it, residents of India can remit a maximum of $250,000 within a given financial year to individuals living overseas. This includes both capital and current account transactions.

Which exemptions are not allowed in the new tax regime?

Under the old tax regime, House Rent Allowance (HRA) is exempted under section 10(13A) for salaried individuals. However, this exemption is not available in the new tax regime.

How is 12 lakh tax free?

The Union Budget 2025 introduced a major income tax relief for the middle class – making annual incomes up to ₹12 lakh completely tax-free* under the new regime. This means if your taxable income is ₹12 lakh or less, you owe zero tax* for the year.

What deductions are still allowed?

You can deduct these expenses whether you take the standard deduction or itemize:

  • Alimony payments.
  • Business use of your car.
  • Business use of your home.
  • Money you put in an IRA.
  • Money you put in health savings accounts.
  • Penalties on early withdrawals from savings.
  • Student loan interest.
  • Teacher expenses.