House rent allowance
This query is : Resolved
11 October 2011
My friend is drawing a salary of Rs.33500 per month which includes hra amounting to rs.10000/- However he is paying Rs.7000/- towards house rent then how much tax be deducted from his salary ? His investment under 80c is Rs.50000/-.
11 October 2011
The exemption of HRA will be available up to the the minimum of the following three options:
1.Actual house rent allowance received from your employer(Rs 10,000)
2.Actual house rent paid by you minus 10% of your basic salary (Rs 7000 - 10% of Basic Salary)
3.50% of your basic salary if you live in a metro or 40% of your basic salary if you live in a non-metro (50% of Basic Salary or 40% of Basic Salary as applicable)
Please see the basic salary component(Basic salary includes DA, if terms of employment so provide and also includes commission based on fixed % of turnover achieved by employee; Basic = Basic + DA + Comm, as explained) out of the gross salary of Rs33,500 and calculate the exemption eligible for HRA using the above formula.
After providing exemption for HRA, compute Gross Total income before deduction under chapter VIA. Now allow Rs50000 u/s 80C as deduction to arrive at taxable income.
1.Actual house rent allowance received from your employer(Rs 10,000)
2.Actual house rent paid by you minus 10% of your basic salary (Rs 7000 - 10% of Basic Salary)
3.50% of your basic salary if you live in a metro or 40% of your basic salary if you live in a non-metro (50% of Basic Salary or 40% of Basic Salary as applicable)
Please see the basic salary component(Basic salary includes DA, if terms of employment so provide and also includes commission based on fixed % of turnover achieved by employee; Basic = Basic + DA + Comm, as explained) out of the gross salary of Rs33,500 and calculate the exemption eligible for HRA using the above formula.
After providing exemption for HRA, compute Gross Total income before deduction under chapter VIA. Now allow Rs50000 u/s 80C as deduction to arrive at taxable income.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Claiming exemption of perquisite for employee-owned car under New Tax Regime in ITR-2
- PPF interest-As Exempt Income disclosure
- Gift of mutual fund units to daughter
- Pass word to open justification report for Q1 for FY 2026-27
- Section 194JA & JB Income which ITR Form to use
- Scrutiny and reopening of past returns
- Under construction property in ITR
- Upload Level ValidationITR3Category of Defect B/D
- Reporting of STCG on Property in ITR
- Building tax payment deduction in rental Income
- Can partnership firm show income under 44ad
- FEMA regulation Act. for inward remitance
- PF Taxable Income
- Clarification on Tax Audit Applicability and Reporting of F&O Transactions in ITR-3
- Interest credited in FY2025-2026 & TDS therein by EPFO does not reflect in AIS or Form 26AS
- 44ad eligble money lending interest
- Delisted shares sold in off market/ Rebate u/s87A
- In Exports Sales HSN details where to fill
- Opting out" of regime provided under subsection (1A) of Section 115BAC but Form 10IEA is not filed.
- Difference in tax comparison report
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
