Income Tax Calculation For House Rent Allowance – U/s 10 (13A)

Illustrative calculation of House Rent Allowance U/s 10 (13A) in respect of residential accommodation situated in Delhi in case of an employee below the age of sixty years (With valid PAN furnished to employer).

S.No. Particulars Rupees
1 Salary 7,00,000
2 Bonus 1,40,000
3 Free gas, electricity, water etc. (Actual bills paid by company) 40,000
4(a) Flat at concessional rate (for tenmonth).  @Rs.36000/month 3,60, 000
4(b Hotel rent paid by employer (for two month) 1,00,000
4(c) Rent recovered from employee. 60,000
4(d) Cost of furniture. 2,00,000
5 Subscription to Unit Linked Insurance Plan 50,000
6 Life Insurance Premium 10,000
7 Contribution to recognized P.F. 42,000

COMPUTATION OF TOTAL INCOME AND TAX PAID THEREON

S.No. Particulars Rupees
1 Salary 7,00,000
2 Bonus 1,40,000
3 Total Salary(1+2) for Valuation of Perquisites 8,40,000

Valuation of perquisites

4(a) Perquisite for flat:
Lower of (15% of salary for 10 months=Rs.1,05,000/-) and (actual rent paid= Rs 3,60,000) i.e. Rs. 1,05,000
 

 

 

 

 

 

 

 

 

 

 

 

1,38,600

4(b) Perquisite for hotel :
Lower of (24% of salary of 2 months=Rs 33,600) and (actual payment= Rs 1,00,000) i.e. Rs 33,600
4(c) Perquisites for furniture(Rs.2,00,000) @ 10% of cost     Rs. 20,000
4(c)(i) Total of [4(a)+(b)+(c)] (1,05,000+ 33,600+ 20,000)Rs.158,600
Less: rent recovered  (-)Rs 60,000    =     98600                                                                          
4(d) Add
Perquisite for free gas, electricity, water etc. Rs.40,000 (+) Rs 98,600 [4(c)(i)] = Rs1,38,600
Total perquisites
5 Gross Total Income (Rs.8,40,000+ 1,38,600) 9,78,600
6 Gross Total Income 9,78,600
7 Less: Deduction U/s 80C:

(i).  Provident Fund (80C)
42,000
(ii).  LIC (80C)

:10,000

(iii). Subscription to Unit Linked Insurance Plan(80C)

:50,000/-

Total                                                x

1,02,000

Restricted to Rs 1,02,000 u/s 80C

 

 

1,02,000

8 Total Income 8,76,600
9 Tax Payable 87,820
10 Add:
(i).Education Cess @2% 1756
(ii). Secondary and Higher Education Cess @1% 878
11 Total Income Tax payable 90,454
12 Rounded off to 90,450

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Discover more from Govtempdiary

Subscribe now to keep reading and get access to the full archive.

Continue reading