COMPUTATION OF INCOME FROM SALARY
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Transcript of COMPUTATION OF INCOME FROM SALARY
COMPUTATION OF INCOME FROM SALARY
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COMPONENTS OF SALARY
FULLY TAXABLE COMPONENTS AND ALLOWANCES
FULLY EXEMPTED ALLOWANCES PARTLY EXEMPTED ALLOWANCES RETIREMENT BENEFITS TAXABLE PERQUISITIES
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COMPONENTS OF SALARY FULLY TAXABLE COMPONENTS AND ALLOWANCES
• ADVANCE SALARY• ARREAR SALARY• BASIC SALARY• BONUS• CITY COMPENSATORY ALLOWANCES • COMMISSION AS A FIXED PERCENTAGE ON
TURNOVER • DEARNESS ALLOWANCE OR PAY• ENTERTAINMENT ALLOWANCES
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• FEES • FIXED MEDICAL ALLOWANCES • FAMILY ALLOWANCE • LEAVE ENCASHMENT ALLOWANCE • LUNCH / TIFFIN ALLOWANCES • MONTHLY OR UNCOMMUTED ALLOWANCE • NON – PRACTICING ALLOWANCE • OVERTIME ALLOWANCE • SERVANT ALLOWANCE • WARDEN ALLOWANCE
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FULLY EXEMPTED ALLOWANCES (sec.10(14) RULE 2BB)
TRAVELLING ALLOWANCE CONVEYANCE ALLOWANCE DAILY ALLOWANCE HELPER ALLOWANCE ACADEMIC ALLOWANCE UNIFORM ALLOWANCE
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PARTLY EXEMPTED ALLOWANCES (sec.10(14) RULE 2BB)
ALLOWANCES PURPOSE OF ALLOWANCE
EXEMPTION LIMIT
CHILDREN EDUCATION ALLOWANCE
FOR EMPLOYEES CHILDREN
RS.100 PER MONTH, PER CHILD, RESTRICTED TO 2 CHILDREN
CHILDREN HOSTEL EXPENDITURE ALLOWANCE
TO MEET THE HOSTEL EXPENDITURE OF EMPLOYEES CHILODREN
RS.300 PER MONTH, PER CHILD, RESTRICTED TO 2 CHILDREN
RUNNING ALLOWANCE GIVEN TO EMPLOYEES WORKING IN THE TRANSPORT SECTOR TO MEET THEIR PERSONAL EXPENDITURE DURING TRANSPORT
LEAST OF THE FOLLOWING :-1. 70% OF THE
AMOUNT RECEIVED 2. RS.10000 PER
MONTH
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ALLOWANCES PURPOSE OF ALLOWANCE
EXEMPTION LIMIT
TRANSPORT ALLOWANCE
GIVEN TO EMPLOYEES FOR TRAVELLING FROM RESIDENCE TO OFFICE AND BACK
RS.800 PER MONTH
MINING OR UNDERGROUND ALLOWANCE
GIVEN TO EMPLOYEES WORKING IN UNDERGROUND MINES
RS.800 PER MONTH
TRIBAL ALLOWANCE INDIVIDUALS EMPLOYED IN TRIBAL AREAS IN NOTIFIED STATES
RS.200 PER MONTH
HILL COMPENSATORY ALLOWANCE
INDIVIDUALS EMPLOYED IN NOTIFIED HILLY AREAS
RS.300 TO RS.7000 PER MONTH (DEPENDING ON THE PLACE)
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ALLOWANCES PURPOSE OF ALLOWANCE
EXEMPTION LIMIT
BORDER/ REMOTE/ DISTURBED AREA ALLOWANCE
INDIVIDUALS EMPLOYED IN BORDER/ REMOTE/ DISTURBED AREA
RS.200 TO RS.1300 PER MONTH (DEPENDING ON THE PLACE)
FIELD AREA ALLOWANCE
NOTE: AN EMPLOYEE CANNOT CLAIM EXEMPTION UNDER BORDER AREA ALLOWANCE, IF HE IS IN RECEIPT OF THIS ALLOWANCE
RS.2600 PER MONTH.
MODIFIED FIELD AREA ALLOWANCE
NOTE: AN EMPLOYEE CANNOT CLAIM EXEMPTION UNDER BORDER AREA ALLOWANCE, IF HE IS IN RECEIPT OF THIS ALLOWANCE
RS. 1000 PER MONTH.
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ALLOWANCES PURPOSE OF ALLOWANCE
EXEMPTION LIMIT
COUNTER INSURGENCY ALLOWANCE
INDIVIDUALS IN ARMED FORCES, OPERATING AWAY FROM THEIR PERMANENT LOCATIONS
RS.3900 PER MONTH
HIGH ALTITUDE ALLOWANCE
ARMED FORCES OPERATING IN HIGH ALTITUDE AREAS.
RS.1060 TO RS.1600 PER MONTH (DEPENDING ON THE PLACE)
SPECIAL COMPENSATORY HIGHLY ACTIVE FIELD AREA ALLOWANCE
ARMED FORCES OPERATING IN HIGHLY ACTIVE AREAS.
RS.3250 PER MONTH
ISLAND DUTY ALLOWANCE
ARMED FORCES EMPLOYED IN ANDAMAN AND NICOBAR AND LAKSHADWEEP ISLANDS
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HOUSE RENT ALLOWANCE U/S 10(13A)/ RULE 2A
CONDITION DOES NOT LIVE IN HIS OWN HOUSE PAYS RENT IN EXCESS OF 10% OF HIS
SALARY FOR HIS RESIDENTIAL ACCOMATION.
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COMPUTATION OF TAXABLE HRA Amount received during the FYTowards HRA xxxxLESS: EXEMPTION (least of the following)1. Amount received as HRA2. 50% of salary (if chennai, mumbai, kolkata and delhi)OR 40% of salary (for other places)3. Rent paid xxx LESS: 10% of salary (xx) (xxx)
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COMPUTATION OF SALARY FOR HRA
BASIC SALARY DA CONSIDERED FOR RETIREMENT
BENEFITS COMMISSION AS A FIXED PERCENTAGE
ON TURNOVER OF EMPLOYEES
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RETIREMENT BENEFITS
GRATUITY SEC10(10)
PENSION SEC10(10A)
LEAVE ENCASHMENT SEC10(10AA)
RETRENCHMENT COMPENSATION
SEC 10(10B)
VOLUNTARY RETIREMENT
COMPENSATION SEC10(10C)
TAX TREATMENT
OF PROVIDENT
FUNDS
RETIREMENT BENEFITS
GRATUITY SEC10(10)
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GRATUITY SEC10(10)
GRATUITY SEC10(10)
RECEIVED BY NON-GOVT EMPLOYEE
COVERED UNDER POGA
NOT COVERED
UNDER POGA
RECEIVED BY GOVT
EMPLOYEE
FULLY EXEMPT
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GRATUITY SEC10(10) When employee is covered under POGA
Amount received during the FYTowards GRATUITY xxxxLESS: EXEMPTION (least of the following)1. Amount received2. 15/26*last drawn salary *no.of years of completed service 3. Notified limit of Rs.10lakh. (xxx)
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COMPUTATION OF SALARY FOR TAXABLE GRATUITY
BASIC SALARY XXXX DA CONSIDERED FOR RETIREMENT BENEFITS XXXX COMMISSION AS A FIXED % ON TURNOVER OF EMPLOYEES XXXX
SALARY FOR GRATUITY
EXEMPTION XXXX
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GRATUITY SEC10(10)When employee is NOTcovered under POGA
Amount received during the FYTowards GRATUITY xxxxLESS: EXEMPTION (least of the following)1. Amount received2. 1/2*average monthly salary *no.of years of completed service 3. Notified limit of Rs.10lakh. (xxx)
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COMPUTATION OF SALARY FOR TAXABLE GRATUITY
BASIC SALARY XXXX DA CONSIDERED FOR RETIREMENT BENEFITS XXXX COMMISSION AS A FIXED % ON TURNOVER OF EMPLOYEES XXXX SALARY FOR GRATUITY
EXEMPTION XXXX
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PENSION SEC10(10A)PENSION
COMMUTED PENSION
UNCOMMUTED PENSION
GOVT EMPLOYEE
NON-GOVT EMPLOYEE
FULLY TAXABLE
GOVT EMPLOYEE
NON-GOVT EMPLOYEE
EMPLOYEE RECEIVES GRATUITY
EMPLOYEE DOES NOT RECEIVE
GRATUITY
FULLY EXEMPT
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COMPUTATION OF TAXABLE COMMUTED PENSION
Commuted pension received xxxxLESS: EXEMPTION 1/3rd of full value of pension received (xxx)
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COMPUTATION OF TAXABLE COMMUTED PENSION
Commuted pension received xxxxLESS: EXEMPTION 1/2* of full value of pension received (xxx)
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LEAVE ENCASHMENT U/S10(10AA)
LEAVE ENCASHMENT
LEAVE ENCASHMENT ON RETIREMENT
GOVT EMPLOYEE
NON-GOVT EMPLOYEE
LEAVE ENCASHMENT WHILE IN SERVICE
FULLY TAXABLE
FULLY EXEMPT
PARTLY EXEMPT
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COMPUTATION OF TAXABLE LEAVE SALARY ON RETIREMENT
Amount actuallyreceived xxxxLESS: EXEMPTION (least of the following)1. Amount received2. average monthly salary *10 months3. Notified limit of Rs.3lakh. 4. Period of earned leave to the Credit of the employee *average Monthly salary (xxx)
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COMPUTATION OF SALARY FOR TAXABLE LEAVE ENCASHMENT
(FOR 10 MONTHS) BASIC SALARY XXXX DA CONSIDERED FOR RETIREMENT BENEFITS XXXX COMMISSION AS A FIXED PERCENTAGE ON TURNOVER OF EMPLOYEES XXXX
SALARY FOR LEAVE ENCASHMENT XXXX EXEMPTION
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RETRENCHMENT COMPENSATION U/S10(10B)
Amount actually received xxxxLESS: EXEMPTION (least of the following)1. Amount received2. Notified limit of Rs.5lakh. 4. Amount determined under the Industrial Disputes Act, 1947 (xxx)
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VOLUNTARY RETIREMENT COMPENSATION U/S10(10C)
Amount actually received xxxxLESS: EXEMPTION (least of the following)1. Amount received2. Notified limit of Rs.5lakh. 4. Amount should not exceed higher of the following: a) last drawn salary *3* completed yr of service b) last drawn salary *no. of years of service (xxx)
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COMPUTATION OF SALARY VOLUNTARY RETIREMENT COMPENSATION
BASIC SALARY XXXX DA CONSIDERED
FOR RETIREMENT BENEFITS XXXX
SALARY FOR VLC EXEMPTION XXXX
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TAX TREATMENT OF PROVIDENT FUNDS S.NO. STATUTORY
PROVIDENT FUNDRECOGNISED PROVIDENT FUND
UNRECOGNISED PROVIDENT FUND
PUBLIC PROVIDENT FUND
1. CONTRIBUTION BY EMPLOYER & EMPLOYEE
BY EMPLOYER & EMPLOYEE
BY EMPLOYER & EMPLOYEE
BY ALL ASSESSES INDEPENDENTLY
2. CLAIM OF DEDUCTION 80C 80C NO TAX BENEFIT 80C
3. EMPLOYERS CONTRIBUTION
NOT TAXABLE AMOUNT EXCEEDING 12% OF SALARY IS TAXABLE
NOT TAXABLE NOT APPLICABLE
4. INTEREST CREDITED FULLY EXEMPT EXEMPT UPTO 9.5%
EMPLOYEES CONTRIBUTION TAXABLE UNDER IFOS,
FULLY EXEMPT
5. WITHDRAWAL EXEMPT EXEMPT EMPLOYERS CONTRIBUTION AND INTEREST THEREON IS TAXABLE AS PROFITS IN LIEU OF SALARY .
EXEMPT
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