Calculation Of Tax – House Building Loan

Calculation Of Tax House Building Loan

Example 6

For Assessment Year 2018-19

Illustrating Valuation of perquisite and calculation of tax in the case of an employee below the age of 60 years of a Private Company posted at Delhi and repaying House Building Loan ( With valid PAN furnished to employer).

 

S.No. Particulars Rupees
1 Salary 4,00,000
2 Dearness Allowance 1,00,000
3 House Rent Allowance 1,80,000
4 Special Duties Allowance 12,000
5 Provident Fund 60,000
6 LIP 10,000
7 Deposit in NSC VIII issue 30,000
8 Rent Paid by the employee for house hired by her 1,20,000
9 Repayment of House Building Loan (Principal) 60,000
10 Tuition Fees for three children (Rs.10,000 per child) 30,000

Computation of total income and tax payable thereon

S.No. Particulars Rupees
1 Gross Salary (Basic+DA+HRA+SDA) 6,92,000
Less: House rent allowance exempt U/s 10 (13A) Least of: 70,000
(a).    Actual amount of HRA received. :Rs.1,80,000 (b).    Expenditure on rent in excess of 10% of salary (Including D.A.)assuming D.A. is included for retirement benefits (1,20,000- 50,000) :Rs.70000 (c).    50% of salary (including D.A) : Rs.2,50,000
2 Gross Total Taxable Income 6,22,000
Less: Deduction U/s 80C  

 

 

 

 

 

1,50,000

(i).    Provident Fund :                          60,000
(ii).   LIP :                                                  10,000
(iii). NSC VIII Issue :                             30,000
(iv). Repayment of HBA :                     60,000
(v).   Tuition Fees (Restricted to two children) :                                                20,000
Total :                                                    1,80,000
Restricted to                               1,50,000
Total Income 4,72,000
Income Tax thereon/payable 11,100
Add:
(i).   Education Cess @2% 222
(ii). Secondary and Higher Education Cess @1% 111
Total Income Tax payable 11,433
Rounded off to 11,430

 

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