In India, income generated from fishing activities is subject to taxation under the Income Tax Act, 1961. Fishing income is classified as business income if the fishing is carried out on a commercial scale with the intention of making profits. This includes income from catching fish, prawns, shrimp, and other aquatic organisms from rivers, lakes, ponds, or the sea.
Small-scale traditional fishermen who engage in fishing for personal consumption or local sale may be exempt from income tax if their annual income falls below the basic exemption limit. However, commercial fishing enterprises, fish farming operations, and export-oriented fishing businesses must maintain proper books of accounts and file income tax returns.
The taxability depends on various factors such as the scale of operations, ownership of fishing vessels, employment of labor, and use of modern fishing equipment. Fishing cooperatives and societies registered under relevant laws may also have specific tax implications. Proper documentation of expenses related to fishing equipment, fuel, maintenance, and labor costs is essential for accurate tax calculation. |
