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Hra and income tax

suraj (Others) (25 Points)

26 July 2015

Hi Im working in a private sector teritiary care hospital

My salary includes HRA of Rs.3000/pm. But the same is being deducted by my employer eventually making that money not reaching my account. The appointment letter provided to me says "accomodation provided". Even though Im not getting any net money under my account through HRA as per the above, I end up giving income tax for that money (Tax for Rs. 36,000/year). And if you look at it, I have never recieved that income..Can someone advice me whether I need to pay tax for this sum which I never infact get it in my account at all...?

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3 Replies

Udgam Koomar (Tax Technologist) (1949 Points)
Replied 26 July 2015

You will have to check the appointment lettee and salary slips and then form16 if they have given the benifit of HRA under section 10.

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suraj (Others) (25 Points)
Replied 27 July 2015

Hi I have checked the salary slip and income tax projection for the year as prepared by my employer for me...In the gross salary income calculation, there is an item saying "LESS - BENEFIT UNDER SECTION 10 (RULE 18a ETC) = Rs.950/-). Dont know how they have calculated that...This amount is deducted from gross salary income for calculation of taxable salary before calculating other deductions for "net taxable salary" calculation. As I mentioned in my earlier post, Im ending up paying tax for "Rs.36,000/- per financial yr which I never recieved in hand... Can someone clarify. Thanks...

Tarun (AM) (216 Points)
Replied 27 July 2015

As per law. This is the right thing that is done by your company. However, u may tell your co. To not show deduction as per sec 10. Then, u may be able to get deduction of complete HRA