Query regarding investment options, tds deducted by employer

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

22 January 2014 Hello Expert,

I have a query. An assessee receives a salary of Rs 11.5/- Lakhs.The Total Income after all deductions comes out to Rs.889000/-.How much rent should he show to get whole HRA exempt. And he has already utilised the 80C limit of 1 Lakh. TDS of abt 96000/- is still deducted. Please suggest what can be done to claim refund or reduce the tax to 2000-3000 Rs.
This is urgent.

@VaibhavJ

@VaibhavJ (Expert)
Follow

22 January 2014 Hi

You can claim HRA max by paying rent at-least equal to in excess of 10% of your annual basic salary.

Thx

Querist : Anonymous

Querist : Anonymous (Querist)

22 January 2014 What if the assessee gets HRA of Rs.15000/- pm. How Much rent should he show then monthly?

And sir also suggest someting to get TDS reduced.

Thank You

Upgrade to CAclubindia Pro. Subscribe Now!

@VaibhavJ

@VaibhavJ (Expert)
Follow

22 January 2014 Hi

He should show Rent equal to Rs. 15,000 + 10% of Basic salary.

Thx

@VaibhavJ

@VaibhavJ (Expert)
Follow

22 January 2014
for tax saving pl refer:

http://profit.ndtv.com/news/your-money/article-income-tax-returns-9-tax-saving-options-other-than-section-80c-319862

http://profit.ndtv.com/news/your-money/article-7-ways-salaried-individuals-can-save-taxes-326356

thx

Querist : Anonymous

Querist : Anonymous (Querist)

22 January 2014 Thank you sir for the links. Is there any other way out other than these investments.

@VaibhavJ

@VaibhavJ (Expert)
Follow

22 January 2014 This is exhaustive, thx.

Message likes : 1 times

Mitul Shah

Mitul Shah (Expert)
Follow

22 January 2014 HRA Exemption least of following:

1) amount equal to 50% of salary if the residential house situated at Bombay, Culcutta, Delhi or Madras and amount equal to 40% of salary where the residential house is situated at any other place;

2) House rent allowance received by the employee in respect of the period during which the rental accomodation is occupied by the employee during the previous year;

3) the excess of rent paid over 10% of salary.

"Salary" for the purpose of HRA exemption means basic salary and includes dearness allowances if terms of employment so provide. It also includes commision based on a fixed percentage of turnover achieved by an employee as per terms of contract of employment - Gestetner Duplicators (P.) Ltd v. CIT [1979] , BUT EXCLUDES ALL OTHER ALLOWANCES AND PERQUISITES.

SO MAXIMUM ALLOWABLE WOULD BE WHAT COMPANY PAYS TOWARDS HRA. As given in your example, MAXIMUM OF 15000/- P.M. WOULD BE ALLOWABLE.

Upgrade to CAclubindia Pro. Subscribe Now!