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Leave Encashment & HRA exemption
Dear Expert,
I got the Leave encashment amount after resignation and also the HRA but the same is not shown in my form 16 from the employer.
I want to file the return 31st july being the last date.
Where can i mention these.
Do I need to deduct the HRA+Leave encashment amount from Gross salary ?
Any help is really appreciated.
THanks in advance
Replies (1)
Sir,
you can mention these in return before filing. But you can not simply deduct the amount received.
FOR HRA:
the exemption 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.
FOR LEAVE ENCASHMENT:
Normally Leave encashment while in service is taxable, but is exempt at retirement, subject to prescribed limits and conditions.
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