§ 308
Chapter XVII — Special Provisions Relating To Certain Persons
Charge of tax in case of oral trust
Income-tax Act, 2025
When a trustee receives income on behalf of a beneficiary under an oral trust, that income is taxed at the highest marginal rate, regardless of any other tax provisions.
This rule applies even if the trust is not documented in writing and the trustee is merely entitled to receive the income.
📜 Official text of the section +
308. (1) Where a trustee receives or is entitled to receive any income on behalf
or for the benefit of any person under an oral trust, then, irrespective of
anything contained in any other provision of this Act, tax shall be charged on such
income at the maximum marginal rate.
(2) For the purposes of this section, “oral trust” shall have the meaning assigned
to it in section 303(3).
4. —Association of persons and body of individuals
Method of computing a member’s share in income of association of persons
or body of individuals.
Plain-language summary — not the official text. Refer to the bare Act and confirm with a professional for your specific case.