Central and State govt employees pay were revised in recent past on account of Sixth Pay Commission . So all govt. staff received lots of arrear payments for which now they are going to file return of Income . Naturally , one of the central concern among them is whether any relief from high tax on account arrear payments they received during FY 2009-10 are available. Yes, they can claim relief from tax on arrears received as per section u/s 89(1) of the I .T. Act. Read below
Media reported today (6th Jul2010 ) that according to an office-memorandum issued by the Centre on Monday
(5th July 2010 ) central govt. employees have been allowed time till December to fix the base date for taking the new pay scale, from a date that is more beneficial to them.
As per Board's letter F. No. 194/6/73-IT(A 1) Dated 19.06.73 exemption in respect of gratuity is permissible even in cases of termination of employment due to resignation. The taxable portion of gratuity will qualify for relief u/s 89(1).
The gratuity payment is a certainty in every case todayContinue reading →
Tax Slabs Expanded
New tax labs are as under
Upto 1,60,000 Exempt
Rs 1,60,001 to Rs 5,00,000 10 %
Ra 500001 to Rs 8,00,000 20 %
Over Rs 8,00,000 30%
Therefore , majority of tax payers will get some kind of relief from tax.
Deduction u/s 80D onContinue reading →