If a PSU bank employee retires from his service on Mar 31, 2010 and the the gratuity cheque is payable on or April 1 ,2010 then in which financial year gratutiy amount becomes taxable?
If a PSU bank employee retires from his service on Mar 31, 2010 and the the gratuity cheque is payable on or April 1 ,2010 then in which financial year gratutiy amount becomes taxable?
Dear Abhinesh,
Gratuity received by employee is taxable under head salary & Income under head salary is taxable on receipt or due whichever is earlier basis.
So in this case Gratuity becomes due on 31st March 2010 & will be taxable in PY 2009-2010(AY 2010-11)
One more thing since amount of gratuity is not received in the PY in which it is taxable so the Exemption u/s 10 shall not be available.
Amir is right here, Gratuity becomes due on 31st March 2010 & will be taxable in PY 2009-2010(AY 2010-11).
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