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What is Form 16?
This Form 16 is a certificate, wherein the employer certifies details of the salary earned by the employee during the year and how much TDS has been deducted on that employee. It has two parts – Part A and Part B. Part A has information of the employer & employee, like name & address, PAN anRead more
This Form 16 is a certificate, wherein the employer certifies details of the salary earned by the employee during the year and how much TDS has been deducted on that employee. It has two parts – Part A and Part B.
In simple words, it is an acknowledgment which states that how much TDS was deducted from your salary and When it was deposited with the Income Tax department. Generally, It is issued by 15th June of the year for which it is being issued but, the due date stands extended to 15 August 2020.
See lessHow to calculate tax relief under Section 89(1) on salary arrears?
In case of receipt of past salary, salary in advance or receipt of family pension in arrears, tax relief under section 89(1) is allowed. Here’s how you can calculate the tax relief as per below steps – Step 1: First calculate the tax payable on the total income, including additional salary – in theRead more
In case of receipt of past salary, salary in advance or receipt of family pension in arrears, tax relief under section 89(1) is allowed.
Here’s how you can calculate the tax relief as per below steps –
Step 1:
First calculate the tax payable on the total income, including additional salary – in the year it is received.
Step 2:
Now calculate tax payable on the total income, excluding additional salary in the year it is received. You need to subtract the arrear received from the employer from the total salary received
Step 3:
Calculate the difference between Step 1 and Step 2.
This will give you the additional tax liability arrived due to arrears of income.
Step 4:
Now calculate the tax payable on the total income of that year to which the arrears relate, excluding arrears.
Step 5:
Calculate tax payable on the total income of that year to which the arrears relate, including arrears
Step 6:
Calculate the difference between Step 4 and Step 5.
This will calculate the actual tax liability in any past year pertaining to which arrears have been received in the current year, had the full arrears received in the same past year.
Step 7:
See lessExcess of the amount at Step 3 over Step 6 is the tax relief that shall be allowed. ( Step 3 minus Step 6). If the amount in Step 6 is more than the amount in Step 3, no relief shall be allowed.
What are the tax benefit under NPS?
National Pension Scheme is a good option for saving as well as tax benefit sources. A tax exemption of Rs.1.5 lakh can be claimed on the employee’s and employer’s contribution towards the National Pension System (NPS). However, employees can get an additional tax benefit of Rs 50000 for self contribRead more
National Pension Scheme is a good option for saving as well as tax benefit sources. A tax exemption of Rs.1.5 lakh can be claimed on the employee’s and employer’s contribution towards the National Pension System (NPS). However, employees can get an additional tax benefit of Rs 50000 for self contribution in NPS. Tax benefits can be claimed under Section 80CCD(1), 80CCD(2), and 80CCD(1B) of the Income Tax Act. Following is a brief description of all these sections:
Therefore, individuals can claim up to Rs.2 lakh as tax benefits under NPS.
See lessCan I Claim HRA and Deduction of Home Loan Interest as well?
Yes you can claim the exemption of HRA as per section 10(13A) as it has no bearing on your home loan interest deduction. The deduction of Interest on the home loans can be taken under section 24b. so, Both can be claimed. In fact, the interest paid on the home loan can be considered as the cost of tRead more
Yes
you can claim the exemption of HRA as per section 10(13A) as it has no bearing on your home loan interest deduction. The deduction of Interest on the home loans can be taken under section 24b.
so, Both can be claimed.
In fact, the interest paid on the home loan can be considered as the cost of the acquisition of property at the time of selling the property and calculating capital gain.
See lessCan I claim deduction of rent paid in both section 80GG and 10(13a) HRA?
Hi, The answer is a big No. If you are paying rent but not receiving house rent allowance then you are allowed to claim deduction under section 80GG subject to your spouse or children are not owning a house property in the place of employment. And, in case you are paying rent and receiving HRA, thenRead more
Hi,
The answer is a big No.
If you are paying rent but not receiving house rent allowance then you are allowed to claim deduction under section 80GG subject to your spouse or children are not owning a house property in the place of employment.
And, in case you are paying rent and receiving HRA, then you can claim a deduction of such HRA as per section 10(13A).
See lessI am receiving HRA (House Rent Allowance) from my employer, How can I get Income Tax exemption of HRA?
House Rent Allowance Salaried employees who receive house rent allowance as a part of salary and incurred payment towards rent can claim HRA exemption to reduce their taxable salary wholly or partially. The deduction of HRA can be claimed under section 10-13A of the Income Tax Act in the following mRead more
House Rent Allowance
Salaried employees who receive house rent allowance as a part of salary and incurred payment towards rent can claim HRA exemption to reduce their taxable salary wholly or partially.
The deduction of HRA can be claimed under section 10-13A of the Income Tax Act in the following manner.
The least of the below is allowed as HRA exemption:
Important Points:
See lessI am living with my parents and receiving HRA from my employer, How can I get the exemption of HRA in Income Tax Act?
Rent paid to parents can also be considered to take an exemption of HRA. It is not fundamentally different with HRA paid to somebody else. There is no is also Let’s understand this with an example. You can pay rent to your parents and can claim the exemption of HRA as per section 10(13A). But beforeRead more
Rent paid to parents can also be considered to take an exemption of HRA. It is not fundamentally different with HRA paid to somebody else.
There is no is also Let’s understand this with an example.
You can pay rent to your parents and can claim the exemption of HRA as per section 10(13A).
But before that you must ensure to follow the following procedure:
- Sign a rental agreement with your parents for the rental property.
- Transfer money to your parents every month.
- Ensure that your parents report the rent paid by you as income in their income tax returns.
See less