Hi, Encashment of leave at the time of retirement is dealt with in Section 10(10AA) of the Income Tax Act. The exemption is available to the Government and other employees in below manner: A. Govt Employees(Central Govt and State Govt) : The amount of leave encashment received by govt employees on rRead more
Hi,
Encashment of leave at the time of retirement is dealt with in Section 10(10AA) of the Income Tax Act. The exemption is available to the Government and other employees in below manner:
A. Govt Employees(Central Govt and State Govt) :
The amount of leave encashment received by govt employees on retirement is fully exempt from tax. Means no tax liability on encashment of earned leave at the time of retirement.
B. Other Employees:
Least of the below is exempted other employees from the amount received towards Leave encashment at the time of retirement (whether on superannuation or otherwise):
Leave encashment actually received
10 months “average salary”
Cash equivalent of unveiled leave (Maximum 30 days leave X Completed Year of service).
Maximum Amount as specified by the Govt i.e. Rs. 3,00,000
Here we need to remember the following terms:
“Salary” for the above purpose means “Basic + Dearness Allowance” including commission received if any based on a fixed percentage of turnover.
“Average Salary” means the average salary drawn by the employee during the period of 10 months immediately preceding his retirement.
Relief Sec 89: Employees in service can claim relief under section 89 of the Income Tax Act.
Hi, So you have received money, generally, people pay to leave a job. So let see the Income-tax treatment of money received in lieu of notice of resignation. This amount will be treated as "Salary" as defined in section 17(1) and will be chargeable to tax on a receipt basis as mentioned in section 1Read more
Hi,
So you have received money, generally, people pay to leave a job. So let see the Income-tax treatment of money received in lieu of notice of resignation.
This amount will be treated as “Salary” as defined in section 17(1) and will be chargeable to tax on a receipt basis as mentioned in section 15 of the Income Tax Act.
Hi, In short " Yes" The Test report of internal financial controls should be placed before the Audit Committee. Now let see the provision related to it: As per part C of Schedule II of SEBI (LODR) Regulations, 2015, the role of the Audit Committee shall include: - Evaluation of internal financRead more
Hi,
In short ” Yes” The Test report of internal financial controls should be placed before the Audit Committee.
Now let see the provision related to it:
As per part C of Schedule II of SEBI (LODR) Regulations, 2015, the role of the Audit Committee shall include:
– Evaluation of internal financial controls and risk management systems;
Further, as per regulation 17(8) of SEBI (LODR) Regulations, 2015, the CEO and CFO shall provide the compliance certificate to the board of directors which would be part of the Annual Report. In that Compliance Certificate, CEO and CFO will certify that:
– They accept responsibility for establishing and maintaining internal controls for financial reporting and that they have evaluated the effectiveness of internal control systems of the listed entity pertaining to financial reporting and they have disclosedto the auditors and the audit committee, deficiencies in the design or operation of such internal controls, if any, of which they are aware and the steps they have taken or propose to take to rectify these deficiencies.
– They have indicated to the Auditors and the Audit Committee “significant changes in internal control over financial reporting during the year”.
Since the Test report is merely an evaluation report of the IFC, they may place the test report to the audit committee for its evaluation.
Hi, TDS on Payment to consultant is covered in section 194J of the Income Tax Act. Let's discuss the second part of this question i.e who is required to deduct TDS As per section 194 J, Every person (Service Recipient) needs to deduct TDS on consultancy charges, except Individual and HUF: In case ofRead more
Hi,
TDS on Payment to consultant is covered in section 194J of the Income Tax Act.
Let’s discuss the second part of this question i.e who is required to deduct TDS
As per section 194 J, Every person (Service Recipient) needs to deduct TDS on consultancy charges, except Individual and HUF:
In case of an individual or HUF carrying on a business: Where his turnover does not exceed Rs. 1 crore during the previous financial year.
In case of an individual or HUF carrying on the profession: Where his turnover does not exceed Rs. 50 lakh during the previous financial year.
Now let’s see the first part of the question i.e what happens if TDS is not deducted.
Following consequences need to face to the service recipient.
Disallowance of 30% Expenditure in the year in which it is claimed.
Interest @1.% per month/part of the month from the date on which TDS was required to be deducted up to the date of actual deduction.
Hi, The purpose of section 44Ad is to give relief to small assessee from compliance of maintaining books of accounts and annual Audit. This section is not related to the filing of ITR. It just gives a method of calculation of the taxable income of a business. So in this case, if the taxable income oRead more
Hi,
The purpose of section 44Ad is to give relief to small assessee from compliance of maintaining books of accounts and annual Audit.
This section is not related to the filing of ITR. It just gives a method of calculation of the taxable income of a business.
So in this case, if the taxable income of a business is less than the maximum amount which is not chargeable to tax then filing of return is not mandatory.
Hi, In short "Yes" Real Estate is on the boom and involved huge costs. Attractive marketing schemes make it more lucrative. Generally, People buy a house with the help of a bank loan and pays interest on that home loan. Repayment of Principal is allowed as deduction under section 80C and Portion ofRead more
Hi,
In short “Yes”
Real Estate is on the boom and involved huge costs. Attractive marketing schemes make it more lucrative. Generally, People buy a house with the help of a bank loan and pays interest on that home loan.
Repayment of Principal is allowed as deduction under section 80C and Portion of such Interest can be claimed as deduction under section 24(b) while calculating Income from the house property.
Now see the twist:
Interest paid on a housing loan can be considered in the acquisition cost of a house while calculating capital gain under section 48.
Section 48 of Income Tax says that
The income chargeable under the head “Capital gains” shall be computed, by deducting from the full value of the consideration received or accruing as a result of the transfer of the capital asset the following amounts, namely:—
(i) expenditure incurred wholly and exclusively in connection with such transfer;
(ii) the cost of acquisition of the asset and the cost of any improvement thereto:
The case of CIT vs. C. Ramabrahmam (2013) also supports this claim.
So, Interest paid on a house loan can be claimed at both the income head, House Property, and Capital Gain.
In simple words, any amount paid by an employer to his employees in lieu of services rendered by them is called salary. Although As per Sec 17(1) of Income Tax Act 1961, Salary Include following payments a) Wages b) Annuity or pension c) Any Gratuity d) Any fees, commission, perquisite, or profits iRead more
In simple words, any amount paid by an employer to his employees in lieu of services rendered by them is called salary. Although As per Sec 17(1) of Income Tax Act 1961, Salary Include following payments
a) Wages
b) Annuity or pension
c) Any Gratuity
d) Any fees, commission, perquisite, or profits in lieu of or in addition to any salary or wages
e) Any Advance of Salary
f) Leave Encashment
g) Employers contribution to the provident fund in excess of 12% of Salary
h) The contribution by the central government or any other employer in the previous year to the account of an employee under a pension scheme u/s 80CCD
Income Tax exemption limit for the below three categories of the individual taxpayer for the Assessment Year 2021-22 is as follows: Taxpayer Income Exemption Limit in old regime Indian Resident below 60 years of age, Huf and NRI Up to Rs 2.5 Lakh Indian Resident 60 years but less than 80 years URead more
Income Tax exemption limit for the below three categories of the individual taxpayer for the Assessment Year 2021-22 is as follows:
Taxpayer
Income Exemption Limit in old regime
Indian Resident below 60 years of age, Huf and NRI
Up to Rs 2.5 Lakh
Indian Resident 60 years but less than 80 years
Up to Rs 3 Lakh
Individual 80 years and above
Up to Rs 5 Lakh
Taxpayer
Income Exemption Limit in New regime
Indian Resident below 60 years of age, Huf and NRI
Hi, You mean the tax slab for the assessment year 2021-22 or say Income tax slab for the financial year 2020-21. Income Tax slab for Individual Below 60 years, HUF and NRI Income Old Regime New Regime Up to 2.5 Lakh NIL NIL 2.5 Lakh to 5 Lakh 5% 5% 5 Lakh to 7.5 Lakh 20% 10% 7.5 Lakh to 10 Lakh 20%Read more
Hi,
You mean the tax slab for the assessment year 2021-22 or say Income tax slab for the financial year 2020-21.
Income Tax slab for Individual Below 60 years, HUF and NRI
is amount received on encashment of earned leave at the time of retirement taxable? is there any exemption available on it?
Hi, Encashment of leave at the time of retirement is dealt with in Section 10(10AA) of the Income Tax Act. The exemption is available to the Government and other employees in below manner: A. Govt Employees(Central Govt and State Govt) : The amount of leave encashment received by govt employees on rRead more
Hi,
Encashment of leave at the time of retirement is dealt with in Section 10(10AA) of the Income Tax Act. The exemption is available to the Government and other employees in below manner:
A. Govt Employees(Central Govt and State Govt) :
The amount of leave encashment received by govt employees on retirement is fully exempt from tax. Means no tax liability on encashment of earned leave at the time of retirement.
B. Other Employees:
Least of the below is exempted other employees from the amount received towards Leave encashment at the time of retirement (whether on superannuation or otherwise):
Here we need to remember the following terms:
Regards
See lessWhat will be the tax treatment of salary receive from employer in lieu of notice of resignation?
Hi, So you have received money, generally, people pay to leave a job. So let see the Income-tax treatment of money received in lieu of notice of resignation. This amount will be treated as "Salary" as defined in section 17(1) and will be chargeable to tax on a receipt basis as mentioned in section 1Read more
Hi,
So you have received money, generally, people pay to leave a job. So let see the Income-tax treatment of money received in lieu of notice of resignation.
This amount will be treated as “Salary” as defined in section 17(1) and will be chargeable to tax on a receipt basis as mentioned in section 15 of the Income Tax Act.
Thanks
See lessWhether testing report of Internal Financial Controls (IFC) is required to be placed before the Audit Committee?
Hi, In short " Yes" The Test report of internal financial controls should be placed before the Audit Committee. Now let see the provision related to it: As per part C of Schedule II of SEBI (LODR) Regulations, 2015, the role of the Audit Committee shall include: - Evaluation of internal financRead more
Hi,
In short ” Yes” The Test report of internal financial controls should be placed before the Audit Committee.
Now let see the provision related to it:
As per part C of Schedule II of SEBI (LODR) Regulations, 2015, the role of the Audit Committee shall include:
– Evaluation of internal financial controls and risk management systems;
Further, as per regulation 17(8) of SEBI (LODR) Regulations, 2015, the CEO and CFO shall provide the compliance certificate to the board of directors which would be part of the Annual Report. In that Compliance Certificate, CEO and CFO will certify that:
– They accept responsibility for establishing and maintaining internal controls for financial reporting and that they have evaluated the effectiveness of internal control systems of the listed entity pertaining to financial reporting and they have disclosed to the auditors and the audit committee, deficiencies in the design or operation of such internal controls, if any, of which they are aware and the steps they have taken or propose to take to rectify these deficiencies.
– They have indicated to the Auditors and the Audit Committee “significant changes in internal control over financial reporting during the year”.
Since the Test report is merely an evaluation report of the IFC, they may place the test report to the audit committee for its evaluation.
Regards
See lessWhat if payment made to consultant by client is without deducting the tds. Who need to pay the tds?
Hi, TDS on Payment to consultant is covered in section 194J of the Income Tax Act. Let's discuss the second part of this question i.e who is required to deduct TDS As per section 194 J, Every person (Service Recipient) needs to deduct TDS on consultancy charges, except Individual and HUF: In case ofRead more
Hi,
TDS on Payment to consultant is covered in section 194J of the Income Tax Act.
Let’s discuss the second part of this question i.e who is required to deduct TDS
As per section 194 J, Every person (Service Recipient) needs to deduct TDS on consultancy charges, except Individual and HUF:
Now let’s see the first part of the question i.e what happens if TDS is not deducted.
Following consequences need to face to the service recipient.
Thanks!
See lessIs interest paid on home loan included in the cost of housing property while computing capital gains tax on its sale?
Since it is included in the cost of acquisition, the benefit of Indexation can be availed as per the provision of section 48.
Since it is included in the cost of acquisition, the benefit of Indexation can be availed as per the provision of section 48.
See lessIs it mandatory to file an ITR if an individual is opting for presumptive taxation u/s 44AD and the profit is less than taxable limits eg say yearly turnover is 10 lakh only?
Hi, The purpose of section 44Ad is to give relief to small assessee from compliance of maintaining books of accounts and annual Audit. This section is not related to the filing of ITR. It just gives a method of calculation of the taxable income of a business. So in this case, if the taxable income oRead more
Hi,
The purpose of section 44Ad is to give relief to small assessee from compliance of maintaining books of accounts and annual Audit.
This section is not related to the filing of ITR. It just gives a method of calculation of the taxable income of a business.
So in this case, if the taxable income of a business is less than the maximum amount which is not chargeable to tax then filing of return is not mandatory.
See lessIs interest paid on home loan included in the cost of housing property while computing capital gains tax on its sale?
Hi, In short "Yes" Real Estate is on the boom and involved huge costs. Attractive marketing schemes make it more lucrative. Generally, People buy a house with the help of a bank loan and pays interest on that home loan. Repayment of Principal is allowed as deduction under section 80C and Portion ofRead more
Hi,
In short “Yes”
Real Estate is on the boom and involved huge costs. Attractive marketing schemes make it more lucrative. Generally, People buy a house with the help of a bank loan and pays interest on that home loan.
Repayment of Principal is allowed as deduction under section 80C and Portion of such Interest can be claimed as deduction under section 24(b) while calculating Income from the house property.
Now see the twist:
Interest paid on a housing loan can be considered in the acquisition cost of a house while calculating capital gain under section 48.
Section 48 of Income Tax says that
The income chargeable under the head “Capital gains” shall be computed, by deducting from the full value of the consideration received or accruing as a result of the transfer of the capital asset the following amounts, namely:—
(i) expenditure incurred wholly and exclusively in connection with such transfer;
(ii) the cost of acquisition of the asset and the cost of any improvement thereto:
The case of CIT vs. C. Ramabrahmam (2013) also supports this claim.
So, Interest paid on a house loan can be claimed at both the income head, House Property, and Capital Gain.
See lessWhat is the definition of Salary as per Income Tax Act?
In simple words, any amount paid by an employer to his employees in lieu of services rendered by them is called salary. Although As per Sec 17(1) of Income Tax Act 1961, Salary Include following payments a) Wages b) Annuity or pension c) Any Gratuity d) Any fees, commission, perquisite, or profits iRead more
In simple words, any amount paid by an employer to his employees in lieu of services rendered by them is called salary. Although As per Sec 17(1) of Income Tax Act 1961, Salary Include following payments
See lessa) Wages
b) Annuity or pension
c) Any Gratuity
d) Any fees, commission, perquisite, or profits in lieu of or in addition to any salary or wages
e) Any Advance of Salary
f) Leave Encashment
g) Employers contribution to the provident fund in excess of 12% of Salary
h) The contribution by the central government or any other employer in the previous year to the account of an employee under a pension scheme u/s 80CCD
How much income is not taxable as per Income Tax Act?
Income Tax exemption limit for the below three categories of the individual taxpayer for the Assessment Year 2021-22 is as follows: Taxpayer Income Exemption Limit in old regime Indian Resident below 60 years of age, Huf and NRI Up to Rs 2.5 Lakh Indian Resident 60 years but less than 80 years URead more
Income Tax exemption limit for the below three categories of the individual taxpayer for the Assessment Year 2021-22 is as follows:
See lessWhat is the Income tax slab as per Income Tax Act?
Hi, You mean the tax slab for the assessment year 2021-22 or say Income tax slab for the financial year 2020-21. Income Tax slab for Individual Below 60 years, HUF and NRI Income Old Regime New Regime Up to 2.5 Lakh NIL NIL 2.5 Lakh to 5 Lakh 5% 5% 5 Lakh to 7.5 Lakh 20% 10% 7.5 Lakh to 10 Lakh 20%Read more
Hi,
You mean the tax slab for the assessment year 2021-22 or say Income tax slab for the financial year 2020-21.
2. For Individual 60 years but less than 80 years
3. For Individual 80 years and above
See less