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Rule 2BB of the Income Tax Rules specifies the allowances paid to employees which are not taxable. One of the allowances which is exempt from tax is what is commonly called Uniform Allowance. Rule 2BB exempts from income tax: any allowance granted to meet the expenditure incurred on the purchase or maintenance of uniform for […]
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Leave a Comment (0) →In the previous post, we had a look at taxability of fuel expense reimbursement to employees for motor car provided by the employer. What about employee-owned car? Employee owns the car and the employer reimburses fuel expense to employee The monthly perquisite value is as follows. i) The car is used wholly and exclusively for official […]
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Leave a Comment (14) →Organizations use “Fuel Expense Reimbursement” as a pay component for tax saving, particularly for members of middle and senior management. The typical payroll treatment for the head of pay is as follows: Pay a certain sum of money as remuneration under the head each month. Seek petrol/diesel purchase receipts from employees. Provide full tax exemption […]
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Leave a Comment (82) →A new tax year is about to begin and it is time to get ready to implement the budget proposals related to tax on salary. As you are aware, the Union Budget for FY 2016-17 was tabled in the Parliament by the Finance Minister of India on 29-Feb-2016. Here are the key proposals related to computation of […]
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Leave a Comment (2) →If you thought that regulatory authorities are all about coercing us into submission by instilling the fear of punishment, you may have to think again. The Employee Provident Fund Organization, commonly referred to as the Provident Fund Department, has announced an incentive scheme in order to motivate employers to complete Universal Account Number (UAN) related […]
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Leave a Comment (1) →According to Section 15 of the Income Tax Act, the following income shall be chargeable to income tax under the head “Salaries”— (a) any salary due from an employer or a former employer to an assessee in the previous year, whether paid or not; (b) any salary paid or allowed to him in the previous […]
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Leave a Comment (2) →While the deadline for Provident Fund (PF) remittance by employers is the 15th of the following month, the PF department allowed an additional 5 days as grace period until now. Given that the PF remittance was done primarily by way of cheque payment at designated branches of the State Bank of India in the past, the […]
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Leave a Comment (0) →The Government of India has notified the Payment of Bonus (Amendment) Act, 2015, by way of a notification dated 01-Jan-2016. The notification impacts the Payment of Bonus Act, 1965, and mandates the following changes with regard to statutory bonus calculation. 1. Bonus eligibility: Until now, employees who are employed on a salary exceeding Rs 10,000 per […]
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Leave a Comment (0) →Section 10 (13A) of the Income Tax Act along with Rule 2A of the Income Tax Rules provides for income tax exemption on House Rent Allowance (HRA) paid to employees. While HRA is one of the most widely used head of pay in Indian organizations, we find many payroll managers not calculating the exemption on […]
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Leave a Comment (0) →As a payroll service provider, we verify the supporting documents submitted by employees when they seek tax benefit. If an employee seeks deduction under Section 24 of the Income Tax Act, for the housing loan interest, we typically seek a certificate from the bank/financial institution which presents the loan principal and interest schedule for the year, […]
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