Amount on which relief u/s 89 is calculated
titu titu (3 Points)
10 August 20201. On salary received ( excluding advance or arrear received)
2. On Total income ( excluding advance or arrear received)
titu titu (3 Points)
10 August 2020
Yudhishthir Sharma
(Article)
(207 Points)
Replied 11 August 2020
Manzil Arora
(Others)
(1012 Points)
Replied 11 August 2020
Hi
Relief u/s 89 is applicable on both, salary received in arrears and in advance. Thus, here are the steps to calculate relief under section 89(1) of Income Tax Act, 1961:
1. Calculate tax payable on total income including arrears in the year it is received.
2. Calculate tax payable on total income excluding arrears in the year it is received.
3. Calculate difference between step 1 and step 2.
4. Calculate tax payable on total income of the year arrears are related including arrears.
5. Calculate tax payable on total income of the year arrears are related excluding arrears.
6. Calculate difference between step 4 and step 5.
7. The amount of relief will be the difference of amount calculated in step 3 over step 6.
No relief shall be allowed if the amount in step 6 is more than the amount in step 3.
titu titu
(3 Points)
Replied 11 August 2020
Calculate tax on total income.here total income means income after all deduction and adjustment.Please clear this
Manzil Arora
(Others)
(1012 Points)
Replied 16 August 2020
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