Hra
This query is : Resolved
06 September 2013
Can an employee gets HRA an amount equal to the amount of his salary? Please give the source of answer also.
06 September 2013
Hi
No.
HRA Calculation
The actual HRA deduction that one can avail under Section10 (13A) would be the minimum of the following:
The actual amount of HRA received.
50% of the salary for individuals residing in metros (Delhi, Mumbai, Chennai or Kolkata) and 40% otherwise.
Rent paid minus 10% of salary (basic component + dearness allowance).
For instance an individual staying in Delhi earns a basic salary of Rs 40,000 per month and rents an apartment for Rs 18,000 per month. He receives an HRA of Rs 25,000 from his employer. His HRA deduction will be the least of the following three figures:
The actual HRA received: Rs 25,000
50% of the salary (since he is staying in a metro city) : Rs 20,000
Excess of rent paid over 10% salary: Rs 18000 - Rs 4,000 = Rs 14,000
Therefore the tax exemption will be Rs 14,000 and the net taxable HRA for the individual will be Rs 25,000 (HRA received) less Rs 14,000 (HRA deduction eligible), which will be equal to Rs 11,000.
Meanwhile if an individual stays in his own property and also gets an HRA from his employer, he will not be entitled for the HRA deduction under the Income Tax Act.
No.
HRA Calculation
The actual HRA deduction that one can avail under Section10 (13A) would be the minimum of the following:
The actual amount of HRA received.
50% of the salary for individuals residing in metros (Delhi, Mumbai, Chennai or Kolkata) and 40% otherwise.
Rent paid minus 10% of salary (basic component + dearness allowance).
For instance an individual staying in Delhi earns a basic salary of Rs 40,000 per month and rents an apartment for Rs 18,000 per month. He receives an HRA of Rs 25,000 from his employer. His HRA deduction will be the least of the following three figures:
The actual HRA received: Rs 25,000
50% of the salary (since he is staying in a metro city) : Rs 20,000
Excess of rent paid over 10% salary: Rs 18000 - Rs 4,000 = Rs 14,000
Therefore the tax exemption will be Rs 14,000 and the net taxable HRA for the individual will be Rs 25,000 (HRA received) less Rs 14,000 (HRA deduction eligible), which will be equal to Rs 11,000.
Meanwhile if an individual stays in his own property and also gets an HRA from his employer, he will not be entitled for the HRA deduction under the Income Tax Act.
06 September 2013
Thank you, but am asking that shall i give my employee an amount as HRA equal to the amount of his salary?
For example, my employee gets salary of Rs.15000 p.m. shall i give him HRA the same amount of Rs.15000 p.m.?
For example, my employee gets salary of Rs.15000 p.m. shall i give him HRA the same amount of Rs.15000 p.m.?
06 September 2013
No, you can not give HRA equal to salary.
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