Taxable value of allownce

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Taxable value of allowance 

What is Allowance?

An allowance is a fixed amount of money received by a salaried employee from his employer to meet a particular type of expenditure over and above salary. For example, companies provide overtime allowance to employees if they work more than fixed working hours. Similarly, there are many other allowances which are provided to salaried individuals. Allowances are treated as part of the salary and are taxable, except for those for which specific exemptions have been provided under various sections of Income Tax Act. Based on their respective tax treatment, these allowances can be categorized into three buckets - Taxable, non taxable and partially taxable


Taxable Income

Taxable allowances are allowances that are treated as a part of salary and are not either fully or partially exempted under any sections of Income Tax. Some of the popular allowances that belong to this category are:

  • Entertainment Allowance

    Entertainment allowance is the amount of money given to an employee to make payments towards hospitality of their customers for drinks, meals, business outings, client meetings, hotels and more. The allowance is completely taxable for all private sector employees. However, government employees can claim exemption on this tax, as quoted under section 16 (ii) and the amount of exemption is limited to the lowest of following i) 20% of gross salary (excluding all other allowance, perks and benefits), ii) Actual entertainment allowance and iii) ₹ 5,000.

  • Overtime Allowance

    This allowance is received by employees who tend to work more than the operational hours decided by the company. It can happen due to urgent assignments and firm project deadlines. Any Overtime Allowance received by the employees is completely taxable.

  • Dearness Allowance (DA)

    Dearness allowance is allowed to be paid to public sector employees and pensioners as a cost of living adjustment to neutralize the impact of inflation and difference is cost of living for employees living in different cities and towns.

  • Meal Allowance

    Meal allowances are paid for meals/refreshments/tiffin services to their employees and are completely taxable.

  • City Compensatory Allowance (CCA)

    CCA is offered by companies to its employees compensate for a relatively high cost of living in metropolitan cities. This allowance is used to incentivize and retain employees in towns and cities where the cost of living is higher compared to employees working in other locations.

  • Interim Allowance

    Interim allowance is an allowance provided by the employer instead of final allowance. Interim allowance is entirely taxable.

  • Cash Allowance

    Cash allowance for expenditure like marriage allowance, holiday allowance and other similar allowances provided by employer, it is fully taxable in the hands of employees.

  • Servant Allowance

    Allowance provided for employees for hiring the services of servant, such allowance is always taxable.

  • Project Allowance

    If an employer provides allowance to employees to liquidate a project's expenses, then it called project allowance and it is completely taxable.

  • Warden Allowance

    If an employee pays tax to an employee who is working as a warden/keeper in any institute. This allowance is considered as taxable.

  • Non-Practicing Allowance

    When a doctor gets associated with clinics of various laboratories or medical institutes, any non practicing allowance paid to them is taxable.

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चित्र
भारत में बेरोजगारी के आंकड़े नेशनल सैंपल संघटन द्वारा एकत्रित एवं प्रकाशित किय जाते है।  विश्व में चीन प्रथम राष्ट्र है जिसने आधिकारिक रूप से पारिवारिक कार्यक्रम नियोजन की अपनाया  निगम कर कंपनियों की आय पर लगाया जाता है  भारत की पहली जनगणना 1872 में की गई थी। योजना आयोग का उपाध्यक्ष कैबिनट मंत्री का दर्जा प्राप्त व्यक्ति होता है । वित विधेयक द्वारा सरकार वर्ष भर राजस्व एकत्र करने की व्यवसथा करती है । India brand equity fund  की स्थापना  1956 में की गई थी। मल्होत्रा समिटी का गठन बीमा क्षेत्र में सुधार के लिए सिफारिश देने के लिए किया जाता है। माह विभाजन  का वर्ष शब्द जनसंख्या के सन्दर्भ देने के लिए 1921 से बढ़ती जनसंख्या से प्रयोग किया जाता है।  Dwcra ग्रामीण क्षेत्र में महिला और बाल विकास कार्यक्रम से अभिप्राय है। घाटे कि वित्त व्यवस्था का अर्थ आगमन से अधिक खर्च करना  सम्पत्ति की अवधारणा में मानवीय सम्पत्ति को फ्रीडमैन ने सम्मिलित किया था । प्रबल प्रयास सिद्धांत आर रोड़ान से सबांधित है । भारत की द्वितीय योजना सोवियत मॉडल पर आधारित है कृ...
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