Profits and Gains of Business or Profession

“Profits and Gains of Business or Profession” refers to the category under the Income Tax Act that covers earnings generated from running a business or engaging in professional work. The Act divides a person’s taxable income into five major groups, and this particular group captures income arising from activities such as trade, consultancy, medical practice, or any other organized business operation.

Example:
If a retailer earns ₹8,00,000 during the financial year from operating his shop, this amount is reported under the head “Profits and Gains of Business or Profession.” Likewise, income of ₹12,00,000 earned by a doctor through her private practice is also classified under the same category.