SUNNY (STUDENT CS) (377 Points)
24 May 2011A person have salary income for the six months is 240856 in delhi city. in which HRA is included of46669/-
compoany has deducted tax 7594/- on his income.
a) is Hra Amount which is provided by company is tax free or taxable ?
if tax free then company deduct tax on HRA amount ?
b) he paid 9000 rent per month in delhi. can he avail the HRA exemption which he paid in delhi ?
Mukesh Kumar Gupta
(Accountant )
(66 Points)
Replied 24 May 2011
Please give hear full breakup of salary .
(ii) House Rent allowance - House rent allowance granted to
the employee is exempt u/s 10(13A) to the following extent;
Provided expenditure on rent is actually incurred, the
amount of exemption granted is the least of
(1) HRA received
(2) Rent paid Less 10% of salary
(3) 40% of salary, (50% in case of Mumbai, Chennai, Kolkata
& Delhi). Salary includes bonus + Dearness allowance,
where provided by terms of employment.
3 6 3 738
It has to be noted that only the expenditure actually incurred
on payment of rent in respect of residential accommodation
occupied by the assessee subject to the limits laid down in rule
2A, qualifies for exemption from income-tax. Thus, house rent
allowance granted to an employee who is residing in a house/flat
owned by him is not exempt from income-tax. The disbursing
authorities should satisfy themselves in this regard by insisting on
production of evidence of actual payment of rent before
excluding the house rent allowance or any portion thereof from
the total income of the employee. Though incurring actual
expenditure on payment of rent is a prerequisite for claiming
deduction under section 10(13A), it has been decided as an
administrative measure that salaried employees drawing house
rent allowance upto3,000 per month will be exempted from
production of rent receipt. It may, however, be noted that this
concession is only for the purpose of tax deduction at source,
and, in the regular assessment of the employee, the Assessing
Officer will be free to make such inquiry as he deems fit for the
purpose of satisfying himself that the employee has incurred
actual expenditure on payment of ren
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 24 May 2011
the exemption of HRA is available between least of following three
1 actual HRA received
2 rent paid- 10%(basic salary +da)
3 50% (basic salary+ da)
SUNNY
(STUDENT CS)
(377 Points)
Replied 25 May 2011
if person paid rent 9000 pm in noida then how much amount he can cliam ?
CAclubindia
