HRA ENTRIES OF SALARY & ADJUSTMENT OF HOUSE RENT OF PERSONAL A/C

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This discussion clarifies how to handle House Rent Allowance (HRA) for staff and rental income from a chairman's personal property. The advice suggests that HRA is a salary component and should be included in the gross salary entry for the school's accounts. For rental income, it's recommended to record it as income in the chairman's personal account, with adjustments made through journal vouchers or by deducting rent from employee accounts and crediting the chairman.

ramya

ramya (Querist)
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03 November 2023 I AM WORKING AS A ACCOUNTANT OF 2 SCHOOLS, 1 COLLEGE, 1 TRUST & 1 PERSONAL A/C. THIS ALL PROPERTY BELONGS TO ONE CHAIRMAN, AND HE GIVES HRA TO SOME OF THE STAFFS IN SCHOOL AS WELL AS GIVE HIS OWN PROPERTY FOR HOUSE RENTAL. THEN HOW TO MAKE ENTRIES IN SALARY OF SCHOOL & RENTAL ACCOUNTS OF PERSONAL A/C.?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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04 November 2023 Account rental receipt in his personal account.
HRA payment in school account.

RAJA P M

RAJA P M (Expert)
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28 November 2023 HRA is one of a Salary component. So, no need any specific expense entriy in accounts. But, in personal books it will be account as rent receipt.

ramya

ramya (Querist)
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29 November 2023 @ RAJA PM , for example, if one of the staff gross salary is Rs.15000, which included HRA of rs.5000/-. In school account i will enter the net salary of Rs.10000/- only, i never enter HRAon that, is that right.?
2. In personal who to entry this Rs.5000/-.?

RAJA P M

RAJA P M (Expert)
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29 November 2023 1. No... Salary entry made Rs 15k for school expense. Deduct Rental amount Rs.5k in employee account and credit the amount chairman's current/(separate ledger as your convenience)
2. In chairman's personal account enter the Rental amount as income and payment through a JV vice-a-versa

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