Question: What Is The Section 17 1?

What are the income that are chargeable to income tax under the head salaries?

Income from salary includes wages, pension, annuity, gratuity, fees, commission, profits, leave encashment, annual accretion and transferred balance in recognised Provident Fund (PF) and contribution to employees pension account..

What is Section 10 of IT Act?

Section 10 of the Income Tax Act allows the computation of specific incomes as tax-free. As per the Income Tax Act, 1961, every Indian citizen who earns above a certain threshold of income is liable to pay taxes. Hence, with the drawdown of each financial year, taxpayers seek out ways to minimize their tax liabilities.

What is formula of gross salary?

To calculate gross pay, take their total annual salary and divide it by the number of pay periods within the year. If a business pays its employees twice a month, that equals out to 24 pay periods within a year. Determine annual salary by determining the amount of money earned annually. It acts as the amount earned.

What is section 17 of Income Tax Act?

Section 17(1) of the Income tax Act gives an inclusive and not exhaustive definition of “Salaries” including therein (i) Wages (ii) Annuity or pension (iii) Gratuity (iv) Fees, Commission, perquisites or profits in lieu of salary (v) Advance of Salary (vi) Amount transferred from unrecognized provident fund to …

What are the tax free perquisites?

As is the case with allowances, the effect of perquisites on salary income largely depends on the type of perquisites that you receive. While there are tax-free perquisites such as rent free accommodation, supply or water or gas, taxable perquisites include education for children, domestic help’s service etc.

What are the 5 heads of income?

There are five heads of income—salary, income from house/property, profit from business or profession, capital gains and income from other sources.

What is the section of salary?

Under Section 192, TDS is deducted at the time of actual payment of salary and not during the accrual of salary. Tax will also be deducted if your employer pays salary in advance to you or you receive arrears from him. In case your estimated salary is not more than the basic exemption limit, TDS will not be deducted.

What is 80c and 10 10d?

Under section 80C, premiums that you pay towards a life insurance policy qualify for a deduction up to ₹1.5 lakh, while Section 10(10D) makes income on maturity tax-free if the premium is not more than 10% of the sum assured or the sum assured is at least 10 times the premium.

What is exemption u/s 10 in salary slip?

The exemption under section 10 covers Leave travel allowance (LTA) Agriculture Income, Life Insurance, Gratuity, leave encashment, Transport allowance etc.

What should I fill in salary as per section 17 1?

According to Section 17(1) salary includes the following amounts received by an employee from his employer, during the previous year : … any advance of salary; any payment received by an employee in respect of any period of leave not availed of by him; (Leave encashment or salary in lieu of leave);

What is Section 17 2 of Income Tax Act?

Broadly, “perquisite” is defined in the section 17(2) of the Income-tax Act as including: 1) Value of rent-free or concessional rent accommodation provided by the employer. … 3) Any sum paid by employer in respect of an obligation, which was actually payable by the assessee.

What is profits in lieu of salary u/s 17 3?

The amount of any compensation due to or received by an assessee from his employer or former employer at or in connection with the termination of his employment or the modification of the terms and conditions relating thereto is regarded as profits in lieu of salary.

Are you filing return under seventh?

Finance Act, 2019 has inserted a new seventh proviso to section 139(1) to provide for mandatory filing of return of income for certain class of person who carries out certain high-value transactions even though the person is otherwise not required to file a return of income due to the fact that total income is below …

What is Section 10 13 A?

Subject to certain conditions, a part of HRA is exempted under Section 10 (13A) of the Income-tax Act, 1961. … This helps an employee to save tax. But do keep in mind that the HRA received from your employer, is fully taxable if an employee is living in his own house or if he does not pay any rent.

How many types of perquisites are there?

Three typesThe Three types of perquisites have been identified under the Indian Income Tax Act: Perquisites taxable for all categories of employees: They are: Rent free house provided by the employer, House provided at concessional rent, Insurance premium paid on the life of the employee. The value of any other fringe benefit.

What is not taxable as income under the head salaries?

Allowances or perquisites paid or allowed as such outside India by the Government to a citizen of India for services rendered outside India are exempt from tax. Students may remember that in such cases under section 9(1)(iii), the income chargeable under the head ‘Salaries’ is deemed to accrue in India.

What is CTC salary?

Cost to company (CTC) is a term for the total salary package of an employee, used in countries such as India and South Africa. It indicates the total amount of expenses an employer (organisation) spends on an employee during one year. … Employees may not directly receive the CTC amount.

What are examples of perquisites?

The definition of a perquisite is a special privilege of your position or status, or a tip or gratuity. Getting to use the corporate jet is an example of a perquisite of being a CEO. If the boss gets a new laptop every year and customarily hands his old one down to his employee, this is an example of a perquisite.

How is Section 17 salary calculated?

As per section 17(1), salary includes the following amounts received by an employee from his employer, during the previous year. The contribution made by the Central Government or any other employer in the previous year, to the account of an employee under a pension scheme, referred to in Section 8OCCD.

Is HRA a perquisite?

HRA is an allowance which is added to your salary and is tax exempt to a certain extent (as per IT rules) whereas CLA is treated as a perquisite (a benefit which is given by company to employee) and is taxable in the hands of the employee.

What is perquisites and its types?

Types of perquisites Rent-free / concessional rent accommodation provided by the employer. Any amount paid by the employer in respect of an obligation which was actually payable by the assessee. Value of any benefit / amenity granted free or at a concessional rate to specified employees.