Go AD-FREE with CAclubindia Pro and Daily WhatsApp Updates. Subscribe Now!

Section 80ccd

415 views 1 replies

azrukhan

Student

82 Points Joined April 2014

Basic salary of mr A is ₹20000 pm . He is entitled to dearness allowance which is 40% of basic salary. 50% of dearness allowance form part of pay for retirement benefit. Both mr A & his employer contribute 15% of basic salary to the person scheme referred to in section 80CCD. Explain tax treatment in respect of such contribution in the hand of MR A. please answer this question I am confusing in this question. I m getting diff answer from book

Replies (1)

Roshan Thomas

C.E.O

356 Points Joined November 2007

Basic 20000 + DA forming part of retirement benefit 20000*40%*50% = 4000 Total = 24000 Max eligible deduction for A' contribution = 24000*10% = 2400*12 = 28800 p.a Contribution restricted to 10% Max Eligible deductiin for Employers contribution = 24000*15%*12=43200 There is no limit for deduction in respect of employers contribution. Employees contributionis eligible for deduction upto 10% only