Section 80QQB: Deduction for Royalty Income

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Jayni Bhavsar

Royalty Income
Last updated on February 14th, 2024

In the writing world, authors don’t just get praise for their stories they also earn money called royalty income. The idea is to compensate the creator for the use of their intellectual property. This money comes from a percentage of each book’s sale. But like all other earnings, it’s subject to taxes. However, the Income Tax provides some relief by allowing deductions under section 80QQB.

What is Royalty Income?

Royalty income is a payment given to an individual or entity as compensation for the use of their intellectual property or assets. For authors, musicians, inventors, and other creative individuals, this type of income usually comes from granting permission to others to use their creations.

Components of Royalty:

These royalty incomes received are taxable to the author, and they have to reflect such under the head Income from Business and Profession as their professional income or under the head Income from Other Sources while filing ITR.

Deduction under section 80QQB

Authors of India who are earning royalty or copyright income can claim the deduction under this section subject to certain conditions. Hence, if the author fulfills the conditions provided then they can claim the deduction u/s 80QQB lower of :

Eligibility criteria for Section 80QQB

The authors who satisfy the below-mentioned conditions are eligible to claim the deduction u/s 80QQB for the incomes earned in India:

However, if the income is earned outside India, they need to satisfy these conditions in addition to the ones mentioned above:

The following are the exceptions from the eligibility criteria:

Form 10CCD

The form 10CCD has to be filed for claiming deduction u/s 80QQB. This form should be duly filed and signed by the entity or individual who is responsible for making payment of royalties.

Form 10CCD


Case Scenario 1
Mrs. Arundhati is a resident Indian and also a recognized author. She is receiving a royalty income of INR 2,45,000. In this case, she can claim the deduction of the entire amount of royalty she received as it is lower than the maximum limit of INR 3,00,000.

Case scenario 2
Mr. Amish is a resident of India and a well-known author of many best-seller fictional books. He earns a royalty income of INR 4,75,000 per annum. He also runs a small business from which his earnings are INR 2,00,000 per annum. Further, there is some interest income from FD of INR 3,40,000. Therefore, his net income will be calculated as below:

ParticularsAmount (INR)
Income from Business and Profession
(royalties 4,75,000 + other 2,00,000)
Income from other sources3,40,0000
Gross Total Income10,15,000
Less: Deductions
Section 80QQB(3,00,000)
Section 80TTA(10,000)
Net Income7,05,000

Calculation of deduction u/s 80DDB:
Lower of – a) Actual royalty income i.e. 4,75,000
b) INR 3,00,000
Hence, here the maximum deduction u/s 80DDB of INR 3,00,000 is available.

Case scenario 3:
Mr. Tapan writes the textbooks for school students and he is an Indian resident. From such a writing profession, he is earning a royalty income of INR 5,00,000 per year. Moreover, he is engaged in other businesses from which he is earning an income of INR 7,00,000 per year. In this case, the calculation of net taxable income will be as below:

ParticularsAmount (INR)
Income from Business and Profession
(royalty 5,00,000 + other 7,00,000)
Gross Total Income12,00,000
Less: Deduction
Section 80QQBNIL
Net Total Income12,00,000

Note: Tapan, being a writer of school textbooks, is ineligible to claim a deduction under section 80QQB, as this is explicitly stated as an exception in the section.


What is considered as Royalty?

Payment received as compensation for writing books or income generated from the copyright for publication is referred to as royalty.

Is the deduction under Section 80QQB applicable only to authors of fictional works?

No, the deduction applies to authors of all types of books, including fiction and non-fiction.

I am writing blogs in newspapers and earning an income from that. So can I claim a deduction u/s 80QQB?

No, the individuals who are writing in newspapers, pamphlets, guides, textbooks, diaries, or journals are not eligible to claim a deduction under section 80QQB.

Is there any specific form to be filed for claiming deduction under section 80QQB?

Yes, authors need to fill out Form 10CCD to claim deductions under Section 80QQB.

What is the maximum amount of deduction that can be claimed as deduction u/s 80QQB?

The maximum deduction under this section can be claimed is INR 3,00,000.

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