Tax on gratuity payment
This query is : Resolved
17 November 2016
Hello,,
An employee is going to resign on coming December 2016.He serve more than 5 years in that company, naturally he is coming under Gratuity Act and we have to pay the Gratuity amount at the time of his resignation.As per I know Gratuity Amount up to Rs.10,00,000.00 is exemption for Tax. Then when I am calculate his Income Tax Computation for his full and Final Settlement , should I consider his gratuity amount into his salary or I left his gratuity amount from his salary and calculate only the salary amount?
An employee is going to resign on coming December 2016.He serve more than 5 years in that company, naturally he is coming under Gratuity Act and we have to pay the Gratuity amount at the time of his resignation.As per I know Gratuity Amount up to Rs.10,00,000.00 is exemption for Tax. Then when I am calculate his Income Tax Computation for his full and Final Settlement , should I consider his gratuity amount into his salary or I left his gratuity amount from his salary and calculate only the salary amount?
17 November 2016
No need to consider gratuity amount if it is paid as per gratuity Act.
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17 November 2016
Yes, the gratuity amount is paid as per Gratuity Act.
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