Sir, I would like to know under section 89 as per rule 21A relief is calculated on which amount.
1. On salary received ( excluding advance or arrear received)
2. On Total income ( excluding advance or arrear received)
Relief u/s 89 calculate on current year income,
1.calculate tax on including arrears
2.calculate tax on excluding arrears
3. difference consider
4.calculate tax on previous year, of which year arrears recd. including arrear
5. calculate tax on previous year, excluding arrears
6. difference consider
7. relief u/s 89 = 3-6, if positive figure than relief availed and if such figure is negative than no relief.
CAclubindia
