Hey guys, could you please explain the taxability of the stipend?
Hey @Dia_malhotra ,
As per the Income Tax Act, stipend is a scholarship given to meet the education expenses. Thus, it is exempted from income tax under Section 10 (16).
Is a Ph.D. fellowship exempted from tax using 10(16)?
The scholarship is exempt u/s 10(16) of the IT Act. You can read more about Is Stipend Income Taxable in India? - Learn by Quicko
Hi,
I have two jobs. One is the PhD stipend that I receive from an IIT (Rs. 4.2LPA), and another is a company job (>Rs. 10LPA). What’s the taxation laws in this case? Do I need to include the stipend I receive from IIT as taxable income? Can it get exempted?
Thanks.
Hi @Qwwq,
An Individual receiving a salary from more than one employer has to consider the total salary received from all employers for computing the total income.
Hence, you need to include your stipend in your total income, which will be taxable as a whole after claiming deductions. No exemption can be claimed for a stipend received as income.
Hope it helps.
how one can differentiate between the stipend received as income or as stipend only, because the institution will never consider it as stipends as it leads to loss of revenue.
Hey, it depends on the nature of the arrangement, not what the institution calls it.
If it’s a pure scholarship or stipend for education with no obligation to work, it is treated as a stipend (and may be exempt).
If there is a requirement to work or provide services, it is treated as taxable income, even if it is called a stipend.
Mam is there any proper rule for this interpretation or all this lies in grey area and open to interpretation regarding the stipend taxation rules ??
Yes, there is a proper rule for this interpretation. As mentioned, it depends on the nature of the contract and arrangement with the institution.
Helpful discussion. Internship stipends can be taxable or exempt depending on whether they are treated as salary or educational scholarship under Section 10(16).