Mr. A who is aged about 41 years is an employee of XYZ Pvt Ltd located in a town in Telangana with a population of 8.5 lakhs. i) He was appointed in the grade of₹10,600-800-18600 on March 1, 2020. He gets₹1170 per month as dearness allowance (which is reckoned as part of salary for computing retirement benefits) and 8% of salary as city compensatory allowance. ii) He is also entitled for special allowance of₹ 75,000/-. iii) He is provided with a rent-free furnished accommodation which is owned by the employer and estimated to have a rental value annually of₹90,000/-. The cost of furnishings is₹3,25,750/- as per the books of account of the employer-company. iv) He has been given a car of 1600 cc used by him for official purposes apart from journey between office and residence. With effect from September 2020, he has been permitted to use the car even for personal use. However, he was provided with a driver only from November 2020. Driver’s salary and other expenses of the car are borne by the employer. v) He contributes 18% of salary to recognised provident fund; to which the employer contributes only 15% of salary. Interest amounting to₹4500/- has been credited to the balance of₹ 50,000/- standing to the credit of his provident fund account. Assuming that salary of a month falls due on the first day of the following month, compute the income chargeable to tax under the head income from salary.
Answers
Answer:
Monthly Income = Rs 42,000
Gross annual income = Rs 42,000×12 = Rs 5,04,000
Applicable deductions:
Monthly GPF contribution = Rs 3000
Annual GPF contribution = Rs 3000×12 = Rs 36,000
NSC = Rs 15,000
Donation in PM's relief fund = Rs 12000
Total applicable deductions = Rs 36,000+15,000+12,000= Rs 63,000
Total taxable income = Gross annual income − total applicable deductions
= Rs 5,04,000− Rs 63,000=Rs 4,41,000
Now the Total taxable income falls in the slab of 2,50,001 to 5,00,000.
So, Incometax=(Taxableincome−2,50,000)×
100
5
=Rs9550
Education cess =9550×
100
2
=Rs191
Secondary and higher education cess =9550×
100
1
=Rs95.5
Total tax to be paid = Income tax + education cess + secondary and higher education cess
=9550+191+95.5=Rs9836.5
Explanation:
मंथली इनकम प्लस + rent income + Kharcha is equals to answer