Method to ascertain Basic Salary.

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)
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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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