Income Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Income, written in plain English, along with examples of how it is used.
What is Income?
Any gain or profit from ones business, rendering services to get salary, wages by labour or from conversion of capital to money by selling it or renting it. It also refers to profit from an investment.
History and Meaning of Income
The concept of income has been around for centuries, and it refers to any money that an individual earns through various means. The definition of income, however, can vary depending on the context in which it is used. In the legal sense, income refers to any gain or profit from a business, rendering services for salary, wages through labor, selling, or renting of capital, as well as profits generated through investment.
Examples of Income
- An individual's monthly paycheck from their employer would be considered income.
- Rental income generated from a property that an individual owns and rents out to tenants is also income.
- Profit made from the sale of stocks, bonds, or other investments is also classified as income.
- A business owner's revenue from the sale of their company's products or services is also considered income.
- Alimony payments received by an individual following a divorce are considered income for tax purposes.
Legal Terms Similar to Income
- Gross Income: Total income before any deductions or taxes are applied.
- Net Income: Income after all expenses and taxes have been deducted.
- Passive Income: Income generated from sources in which an individual is not actively involved in earning, such as rental income or investment income.