Hi, Anybody send me policies related to Travelling Allowance,Dearness Allowance etc. With Regards, Sandip 9552507006.
From India, Pune
From India, Pune
Hi Sandip,
Please see below the allowances and their taxation limit...
Hope it will be useful
House rent allowance
House Rent Allowance (HRA) exemption is applicable only if you are living in a rented house and not in your own house.
Least of the following amount is exempted
1. Actual HRA received
2. 50% in case of metros and 40% in case of others on salary
3. Rent Paid minus 10% of salary
(Where salary =Basic Pay+DA+Commission)
E.g. HRA per month = Rs 15,000
Basic monthly salary = Rs 30,000
Dearness Allowance = Nil
Monthly rent = Rs 12,000
Rental accommodation is in Mumbai.
Exemption
The exemption would be the least of the following:
1. Actual amount of HRA
Rs 15,000
2. 50% of salary (basic component + dearness allowance)
50% x (30,000 + 0)
Rs 15,000
3. Actual rent paid - 10% of salary (basic component + dearness allowance)
Rs 12,000 - [10% of (30,000 + 0)] = 12,000 - 3,000
Rs 9,000
Rs 9,000 being the least of the three amounts will be the exemption from HRA. The balance HRA of Rs 6,000 (15,000-9,000) is taxable.
Conveyance allowance/ Transport Allowance
Granted to employee to meet his expenditure for the purpose of commuting between place of his residences and the place of his duty.
Exempted up to Rs.800p.m
Entertainment Allowances
Any amount received by the employee, as entertainment allowance is taxable as salary. However, deduction is available to the employee if he has been:
The amount of deduction available is restricted to least of the following:
# In case of government employees: Rs. 5,000; 20% of salary; or amount of entertainment allowance granted during the previous year.
# In case of non-Government employees: Rs. 7,500; 20% of salary; amount of entertainment allowance granted during the previous year
Education Allowances
Education allowance of Rs. 100 per month per child for up to 2 children of the employee is exempted. In case the children are in hostel, the exemption available is Rs.300 per month per child for up to 2 children.
Medical Allowances/Reimbursement
This exemption is available in respect of:
Reimbursement up to Rs.15, 000 for medical treatment of the employee and family members.
Note: Medical Allowance is fully taxable. However Re-imbursement of medical expenses is exempted up to Rs. 15000 p.a
Reimbursement means, for claiming the allowance one should produce the bills of the same.
If person is not providing the bills of medical and are taking the allowance then the entire amount would be taxable.
Dearness Allowance
Dearness Allowance (DA) is paid to the employees to compensate them for the erosion in their wages due to increase in the price level.
Dearness Allowance is fully taxable.
70Please see below the allowances and their taxation limit...
Hope it will be useful
House rent allowance
House Rent Allowance (HRA) exemption is applicable only if you are living in a rented house and not in your own house.
Least of the following amount is exempted
1. Actual HRA received
2. 50% in case of metros and 40% in case of others on salary
3. Rent Paid minus 10% of salary
(Where salary =Basic Pay+DA+Commission)
E.g. HRA per month = Rs 15,000
Basic monthly salary = Rs 30,000
Dearness Allowance = Nil
Monthly rent = Rs 12,000
Rental accommodation is in Mumbai.
Exemption
The exemption would be the least of the following:
1. Actual amount of HRA
Rs 15,000
2. 50% of salary (basic component + dearness allowance)
50% x (30,000 + 0)
Rs 15,000
3. Actual rent paid - 10% of salary (basic component + dearness allowance)
Rs 12,000 - [10% of (30,000 + 0)] = 12,000 - 3,000
Rs 9,000
Rs 9,000 being the least of the three amounts will be the exemption from HRA. The balance HRA of Rs 6,000 (15,000-9,000) is taxable.
Conveyance allowance/ Transport Allowance
Granted to employee to meet his expenditure for the purpose of commuting between place of his residences and the place of his duty.
Exempted up to Rs.800p.m
Entertainment Allowances
Any amount received by the employee, as entertainment allowance is taxable as salary. However, deduction is available to the employee if he has been:
The amount of deduction available is restricted to least of the following:
# In case of government employees: Rs. 5,000; 20% of salary; or amount of entertainment allowance granted during the previous year.
# In case of non-Government employees: Rs. 7,500; 20% of salary; amount of entertainment allowance granted during the previous year
Education Allowances
Education allowance of Rs. 100 per month per child for up to 2 children of the employee is exempted. In case the children are in hostel, the exemption available is Rs.300 per month per child for up to 2 children.
Medical Allowances/Reimbursement
This exemption is available in respect of:
Reimbursement up to Rs.15, 000 for medical treatment of the employee and family members.
Note: Medical Allowance is fully taxable. However Re-imbursement of medical expenses is exempted up to Rs. 15000 p.a
Reimbursement means, for claiming the allowance one should produce the bills of the same.
If person is not providing the bills of medical and are taking the allowance then the entire amount would be taxable.
Dearness Allowance
Dearness Allowance (DA) is paid to the employees to compensate them for the erosion in their wages due to increase in the price level.
Dearness Allowance is fully taxable.
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