Standard deduction on salary

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

15 December 2018 An assessee received Salary Income of Rs.45000/- for the month of April 2018. He resigned and is now doing business and has earned Net profit of more than 500,000/- upto October 2018.

The question is - Can he take full benefit of Rs.40,000/- as standard deduction from salary or proportionately for a month??

Please reply.

Message likes : 1 times

Nikhil Kaushik

Nikhil Kaushik (Expert)

16 December 2018 he will get the deduction only to the extent provided for in the salary slip for Month of April.

Student

Student (Querist)

16 December 2018 Sir, I am taking about deduction under section 16(ia) which says : 16(ia) a deduction of forty thousand rupees or the amount of the salary, whichever is less;

Nikhil Kaushik

Nikhil Kaushik (Expert)

16 December 2018 dear Student, the allowance cannot exceed the amount that was paid under the relevant head...so if you received allowance which would normally be around Rs 3333 for a month, how would you claim 40K.

Student

Student (Querist)

17 December 2018 I understood Sir, but where does section 16 say anything about allowance. It's a standard deduction. Budget 2018 has made changes to Rule 2BB, whereas section 16(ia) doesn't speak about allowance.

Nikhil Kaushik

Nikhil Kaushik (Expert)

17 December 2018 actually, you may be correct here. the language does suggest that 40K deduction or salary whichever is lower. So I withdraw my earlier response!

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