How do I calculate the relief u/s 89 of the Act?

How do I calculate the relief u/s 89 of the Act?

Carry out the following steps to calculate the exemption u/s 89:

Step 1: Calculate the tax due in the current year by including the arrears in your total income.

Step 2:  Calculate the tax due in the current year by excluding the arrears from your total income.

Step 3: Compute the difference of amount from Step 1 & 2, called as ‘X’.

Step 4: Calculate your tax due in the year for which the arrears have been received by including the arrears in your total income.

Step 5: Calculate your tax due in the year for which the arrears have been received by excluding the arrears from your total income.

Step 6: After that compute the difference of amount from Step 4 & 5, called as ‘Y’.

Step 7: Finally, subtract X from Y to get the amount to be claimed as relief.


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