Please reply me
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
28 September 2011
Hi Sir,
please tell me what menas by the term excess of rent paid over 10 % of salary
please tell me what menas by the term excess of rent paid over 10 % of salary
28 September 2011
It means=(Rent paid - 10% of salary)
I think you are asking for HRA Exemption.
exemption of HRA will be available up to the the minimum of the following three options:
#Actual house rent allowance received from your employer
#Actual house rent paid by you minus 10% of your basic salary
#50% of your basic salary if you live in a metro or 40% of your basic salary if you live in a non-metro
This minimum of above is allowed as income tax exemption on house rent allowance.
I think you are asking for HRA Exemption.
exemption of HRA will be available up to the the minimum of the following three options:
#Actual house rent allowance received from your employer
#Actual house rent paid by you minus 10% of your basic salary
#50% of your basic salary if you live in a metro or 40% of your basic salary if you live in a non-metro
This minimum of above is allowed as income tax exemption on house rent allowance.
28 September 2011
Meaning of Salary for calculation the exemption of HRA
Salary means (Basic + D.A + Commission based on fixed percentage on turnover).
Salary is to be taken on due basis in respect of the period during which the period accommodation is occupied by the employee in the previous year.
Examples for calculation of exemption/deduction of HRA
X has received following amount during the previous year.
Basic Salary – Rs. (5000*12) – Rs. 60,000/-
Dearness Allowance (D.A) – Rs. (1000*12) – Rs. 12000/-
House Rent Allowance (H.R.A.) – Rs. (2000*12) – Rs. 24000/-
Actual Rent Paid – Rs.(2000*12) – Rs. 24000/-
Calculation
The minimum of the following amount shall be exempt
Actual HRA received (2000*12) – Rs. 24000/-
Rent Paid in excess of 10% of salary ( 24000-7200) – Rs. 16800
40% of Salary – Rs. 28800/-
Therefore, Rs. 16800 shall be exempt and the balance Rs. 7200 shall be included in gross salary.
Salary means (Basic + D.A + Commission based on fixed percentage on turnover).
Salary is to be taken on due basis in respect of the period during which the period accommodation is occupied by the employee in the previous year.
Examples for calculation of exemption/deduction of HRA
X has received following amount during the previous year.
Basic Salary – Rs. (5000*12) – Rs. 60,000/-
Dearness Allowance (D.A) – Rs. (1000*12) – Rs. 12000/-
House Rent Allowance (H.R.A.) – Rs. (2000*12) – Rs. 24000/-
Actual Rent Paid – Rs.(2000*12) – Rs. 24000/-
Calculation
The minimum of the following amount shall be exempt
Actual HRA received (2000*12) – Rs. 24000/-
Rent Paid in excess of 10% of salary ( 24000-7200) – Rs. 16800
40% of Salary – Rs. 28800/-
Therefore, Rs. 16800 shall be exempt and the balance Rs. 7200 shall be included in gross salary.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Advantages and disadvantages new income tax act 2025 question
- Query regarding applicability of UDIN on MCA forms signed using DSC by a Chartered Accountant
- Cash gift by grand mother to her grand daughter
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Spice form, ? mark comes in address
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
- No Compliences after incorporation
- USEFUL LIFE OF USED/SECOND HAND COMMERCIAL VEHICLES
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
