Tax benefit for working in a hilly area, tribal area, border area, and disturbed areas
Section 10(14) of amended finance act 2020 provides tax benefits on allowances paid to salaried people working in hilly areas, tribal areas, duty on the island, duty in the border area or remote area, or any difficult/disturbed areas. Provisions of section 10(14)(ii)provide exemption towards the prescribed allowance granted to an employee to meet his personal…
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List of employee benefits not included under the head of Salaries for the tax treatment
Perquisite may be defined as any casual emolument or benefit attached to an office or position in addition to salary or wages. In the following cases the value of benefits are not treated as perquisites for the purpose of income tax assessment of an employee. Hence, they will not be included under the ‘head of…
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How to calculate tax components on the perquisite value of rent-free unfurnished/furnished accommodation/hotel charge
This article will cover the calculation of taxable perquisite value with regards to quarters provided to employees and hotel charges reimbursed by the employer. Applicable Taxes calculated as per amendments to finance act 2020. A perquisite is a benefit offered to employees by the employer on account of their job or position. The benefits can…
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What is the exemption limit for Transport allowance, Conveyance allowance, etc.?
Updated : as per amended finance act 2020 Conveyance allowance is an allowance offered to taxpayers who receive income from salary to meet the cost of transportation in the course of official work. Usually, it is provided to employees only if there is no transportation provided by the employer. Conveyance allowance: It is provided to…
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Tax Benefits available on Children Education Allowance, Hostel allowance, Tuition fees
Updated: As amended in finance act 2020 As per section 10(14) of Income-tax, children education allowance and Hostel Expenditure Allowance are eligible for deduction available to individuals employed in India. Children Education Allowance: Up to Rs. 100 per month per child up to a maximum of 2 children is exempt Hostel Expenditure Allowance :Up to…
Calculation of Income Tax benefit available on House Rent Allowance
In terms of section 10(13A) & Rule 2A of the amended finance act 2020, a salaried person can claim the exemption in respect of House Rent Allowance received from his/her employer. The least of the following three amounts is exempt from income tax: a) Actual HRA Received b) 40% of Salary* (50%, if house situated…
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