Deduction in Respect of Royalty Income [Section 80QQB]
• A resident individual author (including joint authors) can claim deduction for deriving income by:
Lump-sum consideration for the assignment or grant of his copyright interest in any book;
Royalty or copyright fees for such book;
Non-refundable advance payment of royalties/copyright fees.
• Deduction is allowed for an amount equal to the income earned as royalty or Rs. 3 lakhs, whichever is lower. If there are joint authors, each can claim deduction up to Rs. 3 lakhs.
• If royalty or copyright fees are not a lump sum consideration, the deduction is limited to 15% of the value of books sold during the previous year (without allowing any expenses). Any excess royalty beyond 15% not considered for deduction.
• If the royalty income is earned outside India, deduction is allowed only for royalty income earned in foreign exchange that is brought to India within 6 months from the end of the previous year (or an extended period allowed by RBI or other competent authority). Assessee is required to furnish a certificate in Form 10H electronically.
• To claim the deduction, the assessee must furnish a certificate in Form 10CCD from the payer of income, filed electronically with the return of income.
• Amount claimed under this provision cannot be claimed under any other provision in any other year.