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Method to ascertain Basic Salary.

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This query is : Resolved

Guest

Guest (Querist)

25 July 2010 Dear Experts,

A is a salaried individual working in a Sole Proprietorship Firm.

A has been paid consolidated salary of Rs.27000/-.

A has been making monthly rent payment of Rs.6000/-.

While I am aware that amounts are fixed for Conveyance Rs.800/- p.m. and Reimbursement of Medical Expenditure Rs.1250/- p.m., I am unable to understand the basis to ascertain the Basic Salary in order to arrive out the HRA.

Query

How do we ascertain the Basic Salary ?

Ans : ..............

What is the basis for the Employer to find out the HRA, if A has been making monthly rent of Rs.6000/- p.m. ?

Ans : ..............

Whether the Employer can simply take the actual amounts paid by A and mention in Form 16 as HRA ?

Ans : ..............

I request the Experts to give clarity on the matter.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)

27 July 2010 Basic salary is based on the employer policy and HRA can be 40% or 50% on basic.so consult your employer based on the tax savings you decide your salary structure

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