Exclusive Calculate your Income Tax Payable after New Rebate of 5000!!!

@BaMbU wrote:

@Navneet wrote:

@rajkumar31 wrote:

@Navneet Can you please explain what’s the benefit with the increase in HRA from 24K to 60K? (Section 88G) How will it reduce the taxable income?

Hope this helps :

The rented premises must not be owned by him. In case one stays in an own house, nothing is deductible and the entire amount of HRA received is subject to tax. As long as the rented house is not owned by the assessee, the exemption of HRA will be available up to the the minimum of the following three options:

Actual house rent allowance received from your employer
Actual house rent paid by you minus 10% of your basic salary
50% of your basic salary if you live in a metro or 40% of your basic salary if you live in a non-metro
This minimum of above is allowed as income tax exemption on house rent allowance.

Salary here means basic salary which includes dearness allowance if the terms of employment provide for it, and commission based on a fixed percentage of turnover achieved by the employee. The deduction will be available only for the period during which the rented house is occupied by the employee and not for any period after that.

Meaning of Salary for calculation the exemption of HRA

Salary means (Basic + D.A + Commission based on fixed percentage on turnover).
Salary is to be taken on due basis in respect of the period during which the period accommodation is occupied by the employee in the previous year.

Example for calculation of exemption/deduction of HRA:
X has received following amount during the previous year.

Basic Salary – Rs. (5000*12) – Rs. 60,000/-
Dearness Allowance (D.A) – Rs. (1000*12) – Rs. 12000/-
House Rent Allowance (H.R.A.) – Rs. (2000*12) – Rs. 24000/-
Actual Rent Paid – Rs.(2000*12) – Rs. 24000/-*

Calculation:
The minimum of the following amount shall be exempt:

Actual HRA received (2000*12) = Rs. 24000/-
Rent Paid in excess of 10% of salary ( 24000-7200) = Rs. 16800
40% of Salary = Rs. 28800/-

Therefore, Rs. 16800 shall be exempt and the balance Rs. 7200 shall be included in gross salary.

Note: Do use new limit of Rs.60,000 instead of 24000 for FY 16-17 & AY 17-18

Actual HRA received will be set by employee right. If so what is the use of this new limit.

Truly saying govt. aam janta ko bewkoof banati hai , i am tax student , see exempt to hamasha lower hi hoga so rent paid in excess of 10% of salary will always be lower , so it makes no sense of increasing the limits , media just creates buzzing stories and nothing else

Answer to your question, kuch nahi bass calculations ke liye ye maximum use aayega , otherwise impact 99.99% cases me >>> no change & no benefit

@Navneet wrote:

@BaMbU wrote:

@Navneet wrote:

@rajkumar31 wrote:

@Navneet Can you please explain what’s the benefit with the increase in HRA from 24K to 60K? (Section 88G) How will it reduce the taxable income?

Hope this helps :

The rented premises must not be owned by him. In case one stays in an own house, nothing is deductible and the entire amount of HRA received is subject to tax. As long as the rented house is not owned by the assessee, the exemption of HRA will be available up to the the minimum of the following three options:

Actual house rent allowance received from your employer
Actual house rent paid by you minus 10% of your basic salary
50% of your basic salary if you live in a metro or 40% of your basic salary if you live in a non-metro
This minimum of above is allowed as income tax exemption on house rent allowance.

Salary here means basic salary which includes dearness allowance if the terms of employment provide for it, and commission based on a fixed percentage of turnover achieved by the employee. The deduction will be available only for the period during which the rented house is occupied by the employee and not for any period after that.

Meaning of Salary for calculation the exemption of HRA

Salary means (Basic + D.A + Commission based on fixed percentage on turnover).
Salary is to be taken on due basis in respect of the period during which the period accommodation is occupied by the employee in the previous year.

Example for calculation of exemption/deduction of HRA:
X has received following amount during the previous year.

Basic Salary – Rs. (5000*12) – Rs. 60,000/-
Dearness Allowance (D.A) – Rs. (1000*12) – Rs. 12000/-
House Rent Allowance (H.R.A.) – Rs. (2000*12) – Rs. 24000/-
Actual Rent Paid – Rs.(2000*12) – Rs. 24000/-*

Calculation:
The minimum of the following amount shall be exempt:

Actual HRA received (2000*12) = Rs. 24000/-
Rent Paid in excess of 10% of salary ( 24000-7200) = Rs. 16800
40% of Salary = Rs. 28800/-

Therefore, Rs. 16800 shall be exempt and the balance Rs. 7200 shall be included in gross salary.

Note: Do use new limit of Rs.60,000 instead of 24000 for FY 16-17 & AY 17-18

Actual HRA received will be set by employee right. If so what is the use of this new limit.

Truly saying govt. aam janta ko bewkoof banati hai , i am tax student , see exempt to hamasha lower hi hoga so rent paid in excess of 10% of salary will always be lower , so it makes no sense of increasing the limits , media just creates buzzing stories and nothing else

Answer to your question, kuch nahi bass calculations ke liye ye maximum use aayega , otherwise impact 99.99% cases me >>> no change & no benefit

What I am asking is, Where we will consider this 60000 while calculating tax

Allowed HRA will set by employer
Actual rent paid by employee
Basic salary is set by employer

Where will be the 60000 come into picture

@BaMbU wrote:

@Navneet wrote:

@BaMbU wrote:

@Navneet wrote:

@rajkumar31 wrote:

@Navneet Can you please explain what’s the benefit with the increase in HRA from 24K to 60K? (Section 88G) How will it reduce the taxable income?

Hope this helps :

The rented premises must not be owned by him. In case one stays in an own house, nothing is deductible and the entire amount of HRA received is subject to tax. As long as the rented house is not owned by the assessee, the exemption of HRA will be available up to the the minimum of the following three options:

Actual house rent allowance received from your employer
Actual house rent paid by you minus 10% of your basic salary
50% of your basic salary if you live in a metro or 40% of your basic salary if you live in a non-metro
This minimum of above is allowed as income tax exemption on house rent allowance.

Salary here means basic salary which includes dearness allowance if the terms of employment provide for it, and commission based on a fixed percentage of turnover achieved by the employee. The deduction will be available only for the period during which the rented house is occupied by the employee and not for any period after that.

Meaning of Salary for calculation the exemption of HRA

Salary means (Basic + D.A + Commission based on fixed percentage on turnover).
Salary is to be taken on due basis in respect of the period during which the period accommodation is occupied by the employee in the previous year.

Example for calculation of exemption/deduction of HRA:
X has received following amount during the previous year.

Basic Salary – Rs. (5000*12) – Rs. 60,000/-
Dearness Allowance (D.A) – Rs. (1000*12) – Rs. 12000/-
House Rent Allowance (H.R.A.) – Rs. (2000*12) – Rs. 24000/-
Actual Rent Paid – Rs.(2000*12) – Rs. 24000/-*

Calculation:
The minimum of the following amount shall be exempt:

Actual HRA received (2000*12) = Rs. 24000/-
Rent Paid in excess of 10% of salary ( 24000-7200) = Rs. 16800
40% of Salary = Rs. 28800/-

Therefore, Rs. 16800 shall be exempt and the balance Rs. 7200 shall be included in gross salary.

Note: Do use new limit of Rs.60,000 instead of 24000 for FY 16-17 & AY 17-18

Actual HRA received will be set by employee right. If so what is the use of this new limit.

Truly saying govt. aam janta ko bewkoof banati hai , i am tax student , see exempt to hamasha lower hi hoga so rent paid in excess of 10% of salary will always be lower , so it makes no sense of increasing the limits , media just creates buzzing stories and nothing else

Answer to your question, kuch nahi bass calculations ke liye ye maximum use aayega , otherwise impact 99.99% cases me >>> no change & no benefit

What I am asking is, Where we will consider this 60000 while calculating tax

Allowed HRA will set by employer
Actual rent paid by employee
Basic salary is set by employer

Where will be the 60000 come into picture

Say if lowest of all three comes 67000 or greater than 60000 then exempt 60K only

@Navneet wrote:

@BaMbU wrote:

@Navneet wrote:

@BaMbU wrote:

@Navneet wrote:

@rajkumar31 wrote:

@Navneet Can you please explain what’s the benefit with the increase in HRA from 24K to 60K? (Section 88G) How will it reduce the taxable income?

Hope this helps :

The rented premises must not be owned by him. In case one stays in an own house, nothing is deductible and the entire amount of HRA received is subject to tax. As long as the rented house is not owned by the assessee, the exemption of HRA will be available up to the the minimum of the following three options:

Actual house rent allowance received from your employer
Actual house rent paid by you minus 10% of your basic salary
50% of your basic salary if you live in a metro or 40% of your basic salary if you live in a non-metro
This minimum of above is allowed as income tax exemption on house rent allowance.

Salary here means basic salary which includes dearness allowance if the terms of employment provide for it, and commission based on a fixed percentage of turnover achieved by the employee. The deduction will be available only for the period during which the rented house is occupied by the employee and not for any period after that.

Meaning of Salary for calculation the exemption of HRA

Salary means (Basic + D.A + Commission based on fixed percentage on turnover).
Salary is to be taken on due basis in respect of the period during which the period accommodation is occupied by the employee in the previous year.

Example for calculation of exemption/deduction of HRA:
X has received following amount during the previous year.

Basic Salary – Rs. (5000*12) – Rs. 60,000/-
Dearness Allowance (D.A) – Rs. (1000*12) – Rs. 12000/-
House Rent Allowance (H.R.A.) – Rs. (2000*12) – Rs. 24000/-
Actual Rent Paid – Rs.(2000*12) – Rs. 24000/-*

Calculation:
The minimum of the following amount shall be exempt:

Actual HRA received (2000*12) = Rs. 24000/-
Rent Paid in excess of 10% of salary ( 24000-7200) = Rs. 16800
40% of Salary = Rs. 28800/-

Therefore, Rs. 16800 shall be exempt and the balance Rs. 7200 shall be included in gross salary.

Note: Do use new limit of Rs.60,000 instead of 24000 for FY 16-17 & AY 17-18

Actual HRA received will be set by employee right. If so what is the use of this new limit.

Truly saying govt. aam janta ko bewkoof banati hai , i am tax student , see exempt to hamasha lower hi hoga so rent paid in excess of 10% of salary will always be lower , so it makes no sense of increasing the limits , media just creates buzzing stories and nothing else

Answer to your question, kuch nahi bass calculations ke liye ye maximum use aayega , otherwise impact 99.99% cases me >>> no change & no benefit

What I am asking is, Where we will consider this 60000 while calculating tax

Allowed HRA will set by employer
Actual rent paid by employee
Basic salary is set by employer

Where will be the 60000 come into picture

Say if lowest of all three comes 67000 or greater than 60000 then exempt 60K only

It is only applicable if employer doesn’t provide any HRA otherwise there won’t be any limit

FYI

@BaMbU wrote:

@Navneet wrote:

@BaMbU wrote:

@Navneet wrote:

@BaMbU wrote:

@Navneet wrote:

@rajkumar31 wrote:

@Navneet Can you please explain what’s the benefit with the increase in HRA from 24K to 60K? (Section 88G) How will it reduce the taxable income?

Hope this helps :

The rented premises must not be owned by him. In case one stays in an own house, nothing is deductible and the entire amount of HRA received is subject to tax. As long as the rented house is not owned by the assessee, the exemption of HRA will be available up to the the minimum of the following three options:

Actual house rent allowance received from your employer
Actual house rent paid by you minus 10% of your basic salary
50% of your basic salary if you live in a metro or 40% of your basic salary if you live in a non-metro
This minimum of above is allowed as income tax exemption on house rent allowance.

Salary here means basic salary which includes dearness allowance if the terms of employment provide for it, and commission based on a fixed percentage of turnover achieved by the employee. The deduction will be available only for the period during which the rented house is occupied by the employee and not for any period after that.

Meaning of Salary for calculation the exemption of HRA

Salary means (Basic + D.A + Commission based on fixed percentage on turnover).
Salary is to be taken on due basis in respect of the period during which the period accommodation is occupied by the employee in the previous year.

Example for calculation of exemption/deduction of HRA:
X has received following amount during the previous year.

Basic Salary – Rs. (5000*12) – Rs. 60,000/-
Dearness Allowance (D.A) – Rs. (1000*12) – Rs. 12000/-
House Rent Allowance (H.R.A.) – Rs. (2000*12) – Rs. 24000/-
Actual Rent Paid – Rs.(2000*12) – Rs. 24000/-*

Calculation:
The minimum of the following amount shall be exempt:

Actual HRA received (2000*12) = Rs. 24000/-
Rent Paid in excess of 10% of salary ( 24000-7200) = Rs. 16800
40% of Salary = Rs. 28800/-

Therefore, Rs. 16800 shall be exempt and the balance Rs. 7200 shall be included in gross salary.

Note: Do use new limit of Rs.60,000 instead of 24000 for FY 16-17 & AY 17-18

Actual HRA received will be set by employee right. If so what is the use of this new limit.

Truly saying govt. aam janta ko bewkoof banati hai , i am tax student , see exempt to hamasha lower hi hoga so rent paid in excess of 10% of salary will always be lower , so it makes no sense of increasing the limits , media just creates buzzing stories and nothing else

Answer to your question, kuch nahi bass calculations ke liye ye maximum use aayega , otherwise impact 99.99% cases me >>> no change & no benefit

What I am asking is, Where we will consider this 60000 while calculating tax

Allowed HRA will set by employer
Actual rent paid by employee
Basic salary is set by employer

Where will be the 60000 come into picture

Say if lowest of all three comes 67000 or greater than 60000 then exempt 60K only

It is only applicable if employer doesn’t provide any HRA otherwise there won’t be any limit

FYI

@Navneet Vu ++KG Friend

@Navneet

Wow! Such an informative thread. Thanks for sharing, bro! +kg to you

One query : Can you please give your bit on tax saving scheme other than that of 80c (1.5lacs), like 80 cc etc etc. I mean best possible way to save money ? (Consider this case 4.99 lac annual income)

In general person with 4.99 lac pays 4900. (249000 – 150000 (80c) = 99000 * .10 = 9900 – 5000 (rebate) = 4900). Can I save more??

That would be much much helpful

@nrkmca wrote:

@Navneet

Wow! Such an informative thread. Thanks for sharing, bro! +kg to you

One query : Can you please give your bit on tax saving scheme other than that of 80c (1.5lacs), like 80 cc etc etc. I mean best possible way to save money ? (Consider this case 4.99 lac annual income)

In general person with 4.99 lac pays 4900. (249000 – 150000 (80c) = 99000 * .10 = 9900 – 5000 (rebate) = 4900). Can I save more??

That would be much much helpful

right now busy somewhere else , will let you know tomorrow morning with best possible deductions and exemptions other than 80C

@Navneet wrote:

@nrkmca wrote:

@Navneet

Wow! Such an informative thread. Thanks for sharing, bro! +kg to you

One query : Can you please give your bit on tax saving scheme other than that of 80c (1.5lacs), like 80 cc etc etc. I mean best possible way to save money ? (Consider this case 4.99 lac annual income)

In general person with 4.99 lac pays 4900. (249000 – 150000 (80c) = 99000 * .10 = 9900 – 5000 (rebate) = 4900). Can I save more??

That would be much much helpful

right now busy somewhere else , will let you know tomorrow morning with best possible deductions and exemptions other than 80C

No problem, bro! Will wait for your reply

@nrkmca wrote:

@Navneet wrote:

@nrkmca wrote:

@Navneet

Wow! Such an informative thread. Thanks for sharing, bro! +kg to you

One query : Can you please give your bit on tax saving scheme other than that of 80c (1.5lacs), like 80 cc etc etc. I mean best possible way to save money ? (Consider this case 4.99 lac annual income)

In general person with 4.99 lac pays 4900. (249000 – 150000 (80c) = 99000 * .10 = 9900 – 5000 (rebate) = 4900). Can I save more??

That would be much much helpful

right now busy somewhere else , will let you know tomorrow morning with best possible deductions and exemptions other than 80C

No problem, bro! Will wait for your reply

@Navneet

Its night now

@Navneet

Its night now