Section 10 Income Tax Exemptions — Complete List
Updated: 3 June 2026 | Income-tax Act 2025 | 50+ Tax-Free Income Types
Section 10 of the Income-tax Act lists income that is fully or partially exempt from tax. Key exemptions: agricultural income (unlimited), gratuity (₹20L), leave encashment (₹25L), PPF interest (unlimited), LIC maturity, HRA, LTA, NRE account interest for NRI.
₹25L
Leave encashment exemption on retirement raised to ₹25 lakh (Budget 2023 — non-govt employees).
Earlier: ₹3L limit. Govt employees: still fully exempt. Private sector: min of ₹25L, actual, or formula.
Earlier: ₹3L limit. Govt employees: still fully exempt. Private sector: min of ₹25L, actual, or formula.
Section 10 — Key Exemptions Table
| Section | Income Type | Exemption Limit | New Regime? |
|---|---|---|---|
| 10(1) | Agricultural income (Indian land) | Fully exempt | Yes |
| 10(4) | NRE / FCNR account interest (NRI) | Fully exempt | Yes |
| 10(10) | Gratuity (retirement/death) | Govt: unlimited; Private: ₹20L max | Yes |
| 10(10AA) | Leave encashment (retirement) | Govt: unlimited; Private: ₹25L max | Yes |
| 10(10C) | VRS compensation | ₹5L (once in lifetime) | Yes |
| 10(10D) | Life insurance maturity | Premium ≤ 10% of SA; ULIP > ₹2.5L: taxable | Yes |
| 10(11) | PPF / GPF / RPF interest | Fully exempt | Yes |
| 10(13A) | HRA (House Rent Allowance) | Min of 3 conditions (formula) | No |
| 10(14) | LTA, conveyance, uniform allowances | Actual (LTA: 2 trips/4yr block) | No (LTA not in new) |
| 10(15) | Post Office savings interest | ₹3,500 single / ₹7,000 joint | Yes |
| 10(15) | Tax-free bonds (NHAI, REC, etc.) | Fully exempt | Yes |
| 10(16) | Scholarship for education | Fully exempt | Yes |
| 10(17A) | Award/reward by Govt (Padma, etc.) | Fully exempt | Yes |
| 10(18) | Pension to gallantry award winners | Fully exempt | Yes |
| 10(26) | Income of Scheduled Tribe member in tribal areas | Fully exempt | Yes |
Frequently Asked Questions
What are the major exemptions under Section 10 of Income Tax Act?
Section 10 lists income fully or partially exempt from income tax. Major exemptions: 10(1) — Agricultural income from Indian land (fully exempt); 10(10) — Gratuity up to ₹20L on retirement; 10(10AA) — Leave encashment up to ₹25L on retirement; 10(10C) — VRS amount up to ₹5L; 10(10D) — Life insurance maturity if premium ≤ 10% of sum assured; 10(11) — PPF interest (fully exempt); 10(14) — HRA, LTA allowances (formula-based partial); 10(23) — Religious/charitable trust income; 10(4) — NRE account interest for NRI. All these reduce taxable income to zero or partially exempt the income.
Is agricultural income taxable and how does partial integration work?
Agricultural income from land in India is fully exempt under Section 10(1). However, partial integration applies for other income: If a taxpayer has both agricultural income AND other taxable income, and agricultural income > ₹5,000: Step 1 — Add agricultural income to other income → compute tax on aggregate. Step 2 — Add agricultural income to basic exemption limit → compute tax on this amount. Step 3 — Tax payable = Step 1 minus Step 2. This prevents using agricultural income to artificially push other income into lower slabs. Forest land income, market rent on agricultural land: also agricultural income. Urban/commercial use of agricultural land: not exempt.
Is life insurance maturity amount taxable under Section 10(10D)?
Life insurance maturity: Exempt under 10(10D) if: Premium paid is ≤ 10% of sum assured (policies issued on/after April 1, 2012); ≤ 20% (policies before April 1, 2012). TAXABLE if: Premium > 10% of sum assured. Death benefit: Always exempt (no premium threshold). ULIP policies (Unit Linked) issued after February 1, 2021: if aggregate premium > ₹2,50,000/year — maturity proceeds taxable as capital gains (LTCG at 10%/12.5%). Multiple ULIP policies: aggregate premium across all policies; if total > ₹2.5L in any year, proportionate proceeds taxable. Traditional endowment policies: still exempt if premium ≤ 10% of SA.
What is the HRA exemption calculation under Section 10(14)?
HRA (House Rent Allowance) exemption under Section 10(13A)/10(14): Minimum of three: (1) Actual HRA received from employer; (2) 50% of basic salary (metro: Mumbai, Delhi, Kolkata, Chennai) / 40% non-metro; (3) Actual rent paid minus 10% of basic salary. Example: Basic ₹50K/month, HRA received ₹20K, rent paid ₹22K (Delhi): (1) ₹20K; (2) 50% of ₹50K = ₹25K; (3) ₹22K - ₹5K = ₹17K. Exemption = Min(₹20K, ₹25K, ₹17K) = ₹17K/month. HRA exemption NOT available in new tax regime from FY 2023-24 onwards.
What is the exemption on PF/EPF interest under Section 10?
EPF (Employees Provident Fund) tax treatment: Section 10(11): Interest and accumulated balance from recognized PF — exempt if withdrawn after 5 years of continuous service. EPF interest: Exempt up to 9.5% p.a. for employee contribution; above 9.5% — taxable. Budget 2021 change: Section 10(11A) — if employee EPF contribution > ₹2.5L/year, interest on excess is taxable. If employer also contributes to EPF: threshold is ₹5L/year total (employee + employer contributions together). Employer EPF contribution > ₹7.5L/year: excess is a taxable perquisite. PPF interest: Always fully exempt under 10(11) — no threshold limit.
Related Pages
◆ Available in 71 Cities
Section 10 Exemptions Near You
Expert CA/CS assistance for section 10 exemptions across India. Click your city for local details.
→
New Delhi
→
Mumbai
→
Bengaluru (Bangalore)
→
Hyderabad
→
Chennai
→
Kolkata
→
Pune
→
Ahmedabad
→
Noida (UP)
→
Gurgaon (Gurugram)
→
Jaipur
→
Lucknow
→
Chandigarh
→
Surat
→
Kochi (Cochin)
→
Faridabad
→
Ghaziabad
→
Greater Noida
→
Panipat
→
Sonipat
→
Manesar (IMT)
→
Dharuhera
→
Mathura
→
Palwal
→
Agra
→
Kosi Kalan
→
Aligarh
→
Khair
→
Jewar (Noida International Airport)
→
Kanpur
→
Varanasi (Kashi)
→
Prayagraj (Allahabad)
→
Meerut
→
Bareilly
→
Moradabad
→
Gorakhpur
→
Firozabad
→
Saharanpur
→
Muzaffarnagar
→
Bulandshahr
→
Hapur
→
Karnal
→
Kurukshetra
→
Ambala
→
Hisar
→
Rohtak
→
Yamunanagar
→
Rewari
→
Bhiwani
→
Jodhpur
→
Udaipur
→
Kota
→
Ajmer
→
Bikaner
→
Ludhiana
→
Amritsar
→
Jalandhar
→
Patiala
→
Mohali (SAS Nagar)
→
Bathinda
→
Dehradun
→
Haridwar
→
Rudrapur
→
Shimla
→
Solan (Baddi-Barotiwala-Nalagarh)
→
Bhopal
→
Indore
→
Gwalior
→
Jammu
→
Srinagar
→
Panchkula