Hra deduction

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Reshma.T.Raju

Reshma.T.Raju (Querist)
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06 March 2013 How will we calculate the deduction for HRA u/s 10 (13A) for the financial year 2012-2013, in the case of an employee who receives his DA Arrear (which is related to April 2012 to December 2012)in the month of January 2013? Can you please explain the treatment of the same through an example?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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06 March 2013 Since the arrears are of the current year only, so you have to consider Basic Salary and and Dearness Allowance with arrears ( if forming part of salary for the retirement benefits) .
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You may provide the details of rent, basic salary, D A & HRA for knowing further.
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Reshma.T.Raju

Reshma.T.Raju (Querist)
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07 March 2013 Thank you sir for your valuable reply.Suppose the DA arrear received by the employee in january 2013 also includes arrear for the previous period (ie,from November 2011 to March 2012),Whether we have to consider that arrear during the calculation of deductible amount from HRA in the Financial year 2012-2013?

Santosh Mishra

Santosh Mishra (Expert)
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07 March 2013 Ideally such arrears should also be considered for this purpose as this is getting taxed as salary in current year.

Nilang

Nilang (Expert)
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08 March 2013 Arrears of DA of Previous year received under current f.y. it would be taxable as if income of current f.y.However relief under section 89(1) can be availed.

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