Section 145
Section 145: deduction for collecting and processing biodegradable waste
Section 145 rewards businesses in the waste-to-value chain: if your gross total income includes profits from collecting and processing or treating biodegradable waste for one of four specified end-uses, you can deduct the whole of those profits for five consecutive tax years starting from the year the business commences.
What the deduction gives you
If the gross total income of an assessee includes profits and gains derived from the business of collecting and processing or treating biodegradable waste for any of the following purposes, a deduction equal to the whole amount of such profits and gains is allowed for five consecutive tax years, beginning with the tax year in which the business commences:
- Generating power
- Producing bio-fertilizers, bio-pesticides or other biological agents
- Producing bio-gas
- Making pellets or briquettes for fuel or organic manure
Frequently asked questions
How much of the profit can be deducted under Section 145?
The whole amount of the profits and gains derived from the qualifying biodegradable-waste business - a 100% deduction.
For how many years can this deduction be claimed?
For five consecutive tax years, beginning with the tax year in which the business commences.
What end-uses qualify?
Collecting and processing or treating biodegradable waste for generating power, producing bio-fertilizers/bio-pesticides/other biological agents, producing bio-gas, or making pellets or briquettes for fuel or organic manure.
Want this applied to your actual filing, not just explained?
Talk to our tax team about this deductionLast updated 9 September 2026