Rearding HRA allowance
This query is : Resolved
29 March 2009
I have a question regarding HRA computation
HRA is the least of the following
1.40 or 50% of the salary ( in case of metro & non-metro )
2.actual hra recd
3.Excess of rent paid over 10% of salary
In the following what does salary represent either salary or basic salary
while salary includes DA, commission
and basic salary does not include so
so what shall we take for the computation either salary or basic salary
HRA is the least of the following
1.40 or 50% of the salary ( in case of metro & non-metro )
2.actual hra recd
3.Excess of rent paid over 10% of salary
In the following what does salary represent either salary or basic salary
while salary includes DA, commission
and basic salary does not include so
so what shall we take for the computation either salary or basic salary
29 March 2009
Salary Income
Salary normally includes wages, annuity, pension, gratuity, commission, perquisites, etc. and any other payment received by an employee from the employer received during the year.
Allowances
Most allowances are taxable like City Compensatory allowance, tiffin allowance, fixed medical allowance and servant allowances; encashment of any concession is also taxable.
A) House Rent Allowance
Out of house rent allowance received during the year, least of the following three amounts will not be included in income: -
The amount equal to 50% of annual salary, for persons staying in Mumbai, Chennai, Calcutta or Delhi, but 40%, for others
The actual amount of house rent allowance received
The amount of rent actually paid in excess of 10% of annual salary
Here, salary includes basic salary, dearness allowance, and commission on fixed percentage, but not other allowances.
Salary normally includes wages, annuity, pension, gratuity, commission, perquisites, etc. and any other payment received by an employee from the employer received during the year.
Allowances
Most allowances are taxable like City Compensatory allowance, tiffin allowance, fixed medical allowance and servant allowances; encashment of any concession is also taxable.
A) House Rent Allowance
Out of house rent allowance received during the year, least of the following three amounts will not be included in income: -
The amount equal to 50% of annual salary, for persons staying in Mumbai, Chennai, Calcutta or Delhi, but 40%, for others
The actual amount of house rent allowance received
The amount of rent actually paid in excess of 10% of annual salary
Here, salary includes basic salary, dearness allowance, and commission on fixed percentage, but not other allowances.
29 March 2009
Salary for HRA=
1.Basic
2.DA (Which forms part of retirement benefits).
3.Commission(On fixed percentage of turnover).
1.Basic
2.DA (Which forms part of retirement benefits).
3.Commission(On fixed percentage of turnover).
29 March 2009
ya thanks
means salary represents all incomes which can be included under salaries ( like DA, commission ....etc; )
so while calculating the 1st pt and even the 3rd pt we have to take salary not the basic salary
Thanks for the communication.
means salary represents all incomes which can be included under salaries ( like DA, commission ....etc; )
so while calculating the 1st pt and even the 3rd pt we have to take salary not the basic salary
Thanks for the communication.
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