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Salary Income

  • Penalties under Income Tax Act

    Sec 140A(3): - When assessee fails to pay wholly or partially of Self Assessment Tax or Interest or penalty or less than, in such a case Assessing Officer may impose any amount of fine subject to Maximum of Tax in arrears.

    Sec 158BFA(2): - Minimum 100% of Tax leviable subject maximum of 300% of Tax liable on determination of Undisclosed Income.

    Sec 221 (1): - Any amount may be imposed by Assessing Officer as penalty on

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  • Common Mistakes Done by Assessee while Filing Income Tax Return

    Wrong Calculation of Exemption of House Rent Allowance (HRA)

    So, Many times claim exemption of whole amount House Rent Allowance (HRA) Received even if Some portion of HRA is Taxable. Asseessee must take exemption of minimum of - 

    Actual HRA Received

    40% Of Salary or Incase of Metro Cities 50% of Salary

    Excess of Rent Paid over 10% Salary

    Note: - Here Salary means Basic plus Dearness Allowance (DA) if

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  • Tax Treatment of Retirement Benefits Received by Asseessee

    Any Person who had completed his or her Service Period expects some benefits on Retirement based on Performance during Service. Retirement benefits may be in form of Gratuity or Pension or Leave Encashment etc. Even Non Government Employers are also bound to provide Benefits subject to certain exemptions. Taxability of such Benefits depends on nature Benefits and type of Employee along Relevant Legislation.

     

    Gratuity

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  • Amendments or Changes in Income Tax for Financial Year 2018-19 (Assessment Year 2019-20)

    Standard Allowance to Salaried Employees in Place of Medical Allowance or Reimbursement, and Transportation Allowances

     

    Treatment up to Financial Year 2017-18 ( Assessment Year 2018 - 19 ): -

     

    Medical Allowance: - Any Fixed amount of Money Received by Employee from Employer every Month i.e. Medical Allowance is Fully Taxable in Hands of Employee irrespective of amount

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  • Explanation to Different Income Tax Return Forms  

     

    ITR -1

    ITR -1 is simple Return for Resident Individual

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  • Set Off and Carry Forward of Losses

    Intra Head Set off of Losses (Set Off of Loss against Income of Same Head)

    Any losses arises under any Head of Income can be set off from any Income from any other Source under same head for that assessment year or any subsequent year, except few cases where losses can not set off to any other Income under same head for that assessment year or any subsequent year.

     

    Cases or

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  • Income Tax and Goods and Service Tax Compliance Applicable to Company

    Income Tax Compliance Applicable to Company 

    TDS Return for Q1: - Every Deductor who Deducted TDS in Q1 shall require to

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  • FAQ on Salary Income

    Q.1) What is considered as salary income?
    section 17​​ of the Income-tax Act defines the term ‘salary’. However, not going into the technical definition, generally whatever is received by an employee from an employer in cash, kind or as a facility [perquisite] is considered as salary.

    Q.2) What are allowances? Are all allowances taxable?| What are Perquisites? | How they are taxed? | How

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  • Documents or Information Required for Income Tax Return Filing

    Classification of Income : - Income of Asseessee first needs to be Classified into following Five heads or Source of Income : -

    Income from Salary : - Any Amount Received by Employee from Employer in form of Cash (Basic, Dearness Allowance, House Rent Allowance or any Other Allowances, Commission on Sale and Bonus etc.) or any Non Cash Facility shall be treated as Income from Salary of Asseessee. Primary Condition of Income from

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  • Reasons for Mismatch of Income in Income Tax Return and Consequences of Such Mismatch

    Every Income Tax Return Filled by Asseessee will be Processed by Income Tax Department at Centralised Processing Centre (CPC) Bangalore without calling Asseessee.

    During Processing of Income Tax Return Income Tax Department will Compute Income of Asseessee after Making Certain Adjustments.

    Following Adjustments will be made in Income of Asseessee During Processing of Income Tax Return: -

    Any Arithmetic Error in Income

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  • NPS Tax Benefits and Tax Treatment at Maturity (Latest)

     

    NPS Tax Benefits (Latest)
    This part has not been affected by the latest budget. Only contribution to Tier-I NPS account is eligible for income tax benefits.

    Investment up to Rs 1.5 lacs into NPS in a financial year is eligible for deduction under Section 80CCD(1). Please note this deduction comes under the overall ceiling of Rs 1.5 lacs for deduction under Section 80C. In

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  • Best Investment Plan in India for Senior Citizens

    Best Investment Plan in India for Senior Citizens

    Here are some of the best investment options available for Senior Citizens. However, one should choose them based on tenure and any risk appetite (which is generally low anyways).

    1) Senior Citizens Saving Scheme (SCSS)

    It is a special account that can be opened by the senior citizens of India. It is a

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  • How to withdraw 75% of your EPF money if you remain unemployed for a month

    Salaried individuals, who contribute to the Employees’ Provident Fund (EPF), will soon be able to withdraw up to 75% of their EPF money in case they are out of a job for at least a month. The central board of trustees of Employees’s Provident Fund Organisation (EPFO) that met last week decided that employees who have been unemployed for a month will be allowed to withdraw 75% of their EPF corpus. This is the cumulative corpus

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  • NPS Withdrawal: Norms, Purpose, Limits and Frequency

    NPS Withdrawal Norms
    The Pension Fund Regulatory and Development Authority (PFRDA) has changed the norms for withdrawal of National Pension System (NPS)subscribers. Keeping in view the possibility of sudden financial needs of the subscribers, the requirement of minimum period under National Pension System (NPS) for availing the facility of partial withdrawal from the mandatory Tier-I account of the subscriber

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  • What exemption on LTC cash voucher scheme means for you- A Note

    Government in Budget 2021 notified Leave Travel Concession (LTC) cash Voucher scheme. In view of the situation arising out of outbreak of COVID pandemic, it is proposed to provide tax exemption to cash allowance in lieu of LTC.

    Initially, the scheme was announced in October

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  • Income Tax Return Processing- An Analysis

    Income tax return filing
    The taxpayers should file their income tax returns by the due date to avoid any late fees and the penalty. The ITR processing starts only with the filing of the return; it can be on time or after the due date. However, it is also advisable to file the

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  • Dividend Distribution Tax- An Analysis

    Who is required to pay Dividend Distribution Tax(DDT) and at what rate
    Any domestic company which is declaring/distributing dividend is required to pay DDT at the rate of 15% on the gross amount of dividend as mandated under Section 115O. Therefore the effective rate of DDT is

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  • All About Tax dispute resolution Coverage, Scope, Problems, Challenges, Suggestions & Motive

    Tax dispute resolution in the Indian context hasn’t particularly been an encouraging experience. While a portion of this taint could be attributed to complexity of tax laws and efficiency levels of the administrative process, a material reason is delay in seeking resolution due to multiple layers of appeals, which currently is four.

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  • Article on Section 194A – TDS on Interest other than Interest on Securities

    What is Section 194A?
    This section is only applicable to a resident. Thus, the provisions of section 194A are not applicable in case of payment of interest to a non-resident.
    Payments made

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