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Claiming relief under 10(10C)

Sanjay Chitnis (Service) (53 Points)

28 July 2009

Hi,

I got Voluntary separation from a private limited company last year. My company did not provide any relief under 10 (10C) in TDS and thus in Form 16. I am above 40 years of age and worked in the company for more than 10 years. The compensation I received in more than 5 Lakhs. I believe the company followed the requiresite guidelines under 2BA.

Do I need any letter from the company that the requiresite guidelines under rule 2BA were followed ? Can I claim the rebate in my returns?

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2 Replies

SANKAR KIRAN P (Top Edge of CA & CS) (246 Points)
Replied 28 July 2009

hiiiii...the exemption is only available to employees who work with public and private sector companies, local and statutory authorities, co-operative societies, universities, the Indian Institutes of Technology and other institutes notified under the Income Tax Act. Such employees can only claim this exemption once in a life time

provided you hve satisfied the following conditions

Only employees who have completed 10 years of service or 40 years of age are eligible;
The scheme applies to all employees, except directors;
The scheme should be drawn so as to result in an overall reduction in the existing strength of the employees;
The vacancy thus caused should not be filled up; and
The retiring employee should not be employed by any other concern belonging to the same managemen

.the amount received should not exceed the following limits for it to be tax-exempt:
- An amount equivalent to three months’ salary (inclusive of daily allowance, but excluding other allowances and perquisites) for each completed year of service computed on the basis of the last drawn salary; or
- The salary (inclusive of daily allowance, but excluding other allowances and perquisites) drawn at the time of retirement multiplied by the number of months of service left.

Therefore, u can claim the exemption ...