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 | |
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Valuation of perquisites |
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| 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 |
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| 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 |
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| 4(d) | Add Perquisite for free gas, electricity, water etc. Rs.40,000 (+) Rs 98,600 [4(c)(i)] = Rs1,38,600 Total perquisites |
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| 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) |
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| :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 |
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| 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 | |