Indian Income Tax | Trade Unions
Section 10(24) Income Tax Exemption for Registered Trade Unions
Section 10(24) of the Income-tax Act, 1961 exempts specified income of eligible registered trade unions and qualifying associations of those unions. The exemption applies to particular heads of income, not automatically to every receipt of a trade union.
Meaning and scope of Section 10(24)
Under clause (24) of Section 10 of the Income-tax Act, 1961, specified income of a registered trade union, within the meaning of the Trade Unions Act, 1926, formed primarily for the purpose of regulating relations between workmen and employers or between workmen and workmen, is excluded from total income. The provision also covers an association of registered unions of that kind.
Eligible assessee, nature of income and amount exempt
| Eligible assessee | A qualifying registered trade union or association of qualifying registered trade unions. |
|---|---|
| Registration requirement | The union must meet the applicable statutory registration requirement referred to by the income-tax provision. |
| Primary purpose | Regulation of relations between workmen and employers or between workmen and workmen. |
| Exempt income | Income chargeable under the heads Income from house property and Income from other sources. |
| Extent of exemption | The full amount of income falling within the specified exempt categories, subject to the applicable statutory requirements. |
| Not a blanket exemption | Income falling under other tax heads is not automatically exempt merely because the recipient is a registered trade union. |
Conditions for exemption
- Registered trade union: The organization must qualify as a registered trade union under the legislation referenced in the applicable income-tax law.
- Specified primary objective: The union must be formed primarily to regulate workmen-employer or workmen-workmen relations. Its constitution and actual activities may be relevant when determining eligibility.
- Association of unions: An association can qualify where it is an association of the specified registered trade unions.
- Specified income heads: The exemption is confined to income chargeable under the two heads expressly identified by the clause.
- Applicable tax period: Apply the law and any transitional provisions in force for the relevant tax year.
Examples of income covered and not automatically covered
Income from house property: Rental income from a building owned by an eligible union may fall within the exempt head, provided it is chargeable under that head.
Income from other sources: Interest or other receipts assessed under that head may qualify. The actual classification of a receipt must be determined under the tax law.
Business or capital gains income: Section 10(24) does not expressly exempt income chargeable as business profits or capital gains. Any separate relief must be independently established under the relevant law.
Trade union registration and legal definitions
The Trade Unions Act, 1926 historically governed registration and defined trade unions, including combinations formed primarily to regulate specified employment relations. Consult the official text and the legislation in force for the relevant period, including changes arising under India's labour-code framework. Registration alone does not establish that every category of union income is tax-free.
For authoritative legislation, consult India Code and the Ministry of Labour and Employment.
Income-tax legislation from 1 April 2026
The Income-tax Act, 2025 came into force on 1 April 2026. Section 10(24) is the citation under the Income-tax Act, 1961 for periods governed by that Act. For tax years governed by the 2025 Act, consult the corresponding enacted provisions and transitional rules rather than assuming the old section numbering continues unchanged.
Official references
- Income Tax Department: income-tax legislation
- India Code: central legislation, including trade union law
- Ministry of Labour and Employment
- Income Tax Department e-Filing portal
Frequently asked questions
Which trade unions qualify under Section 10(24)?
A registered trade union within the statutory description, formed primarily to regulate relations between workmen and employers or between workmen and workmen, and a qualifying association of registered unions.
What income is exempt under Section 10(24)?
Income chargeable under the heads Income from house property and Income from other sources, subject to the statutory conditions.
Is business income automatically exempt?
No. Section 10(24) does not provide a blanket exemption for business income or every category of receipts.
Does Section 10(24) remain the section number for tax year 2026-27?
Section 10(24) belongs to the Income-tax Act, 1961. The Income-tax Act, 2025 applies from 1 April 2026, so consult its corresponding provisions for periods governed by the new Act.
This article provides a general overview. Eligibility and the treatment of individual receipts depend on the enacted law applicable to the relevant tax period.