Question

Expenditure incurred on exempted income is
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Answer 1

Expenditure incurred on exempted income is fully allowed as deductions.

According to Section 14A of the Indian Income Tax Act of 1961, any expenses made for generating income that is already exempt and that do not count toward the taxpayer's total revenue shall not be taken into account.

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Answer 2

Answer:

exempt incomes are the incomes that are not chargeable to tax as per income tax law.

Explanation:

• section 14A is a disallowance provision.
• this section provides that while compuuting the total income of an assessee,no deduction will be permitted in respect of any expense incurred in relation to any income which is exempt from income tax.
• exempt income are those on which tax is not likely to be paid.

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