i. Salary
Do I have to submit this form to the income tax department?
Form 15G & Form 15H are not required to be submitted to the income tax department by you. When you submit them to the deductor, he/she will prepare a detail of all such forms received and submit to the income tax department,
My employer gives me tax allowance and does not pay my tax by himself. Do I need to include this allowance in my income from salaries?
Yes. It is a part of income from salaries, and it is taxable according to the slab rate.
What is Tax-Free Salary? In case of Tax-Free Salary, is the amount of income tax paid by the employer required to be included in the taxable income from Salary?
When the employer agrees to pay tax on the Salary paid to the employee without applying any cap on the amount of tax to be paid, it can be said to be a Tax-Free Salary. However, this tax-free salary is also taxable in the hands of the employee. The ...
The income received by me from my employer does not fit into any of the items specified in Section 15 and 17 of the IT Act. In that case, is my income still taxable as Salary income?
Section 15 of the Income Tax Act contains all the conditions in which the income received or accrued can be classified under ‘Salary’ for tax treatment. It also tells us how the tax thereon should be paid. Section 17 defines what incomes will be ...
I am an employee of the Central/State Government in India. I am deployed on official duties outside India. Is my Salary paid to me in India taxable as income from Salary?
Yes, the salary received would be taxable in India. If a citizen of India renders services outside India, and receives salary from the Government of India, it would be taxed in the same manner as Salary accrued in India. (Sec. 15 & 9, Income Tax Act)
I am an employee of a Multinational Corporation and working in India. However, my salary is paid outside India. Is such an income taxable in India?
Salary accrues where the services are rendered even if it is paid outside India; Hence, the income received outside India against services rendered in India will be taxable in India. (Sec 15 & 9, Income Tax Act)
I am the legal heir of a Government Servant who died in harness. I have received certain amount as leave Salary encashment upon his death, in the capacity of his legal heir. Is it taxable as income from Salary?
This receipt in the hands of the family is not in the nature of one from an employer to an employee. The deceased had no right or interest in this receipt. This payment is only by way of financial benefit to the family of the deceased Government ...
What is Leave Encashment? Is it taxable?
Some employers allow the employees to accumulate leave in case the employee is not availing the admissible leave. This un-availed leave is eligible to be encashed in monetary terms by the employees from employer. This monetary encashment is called is ...
I am an employee of a Foreign Government working in India. Is my Salary paid by my employer i.e. Government, taxable in India?
Salary paid by a foreign Government to its employees serving in India is taxable under the head "Salaries" u/s 15 of the 1961 Act. The words ‘an employer’ occurring in clause (a) of that section are wide enough to include a foreign Government. But if ...
My employer paid me Salary for a part of the financial year but my services were rendered for the full year. Do I need to pay tax on the entire amount of Salary due to me from the employer?
Any Salary due from an employer or a former employer to an employee in the previous year whether paid or not, is chargeable to income-tax under the head ‘Salaries’ (As per Clause(a) of section 15). In other words, the Salary accrued or which becomes ...
In the hospitality and entertainment Industry, customers often pay tips to waiters and artistes who often are employees of a certain organisation. Is this income by way of tips taxed as income from ‘Salary’?
No, since the basic ingredients of employer-employee relationships are missing in this scenario. The income from tips is not to be taxed as income from Salary but is to be taxed as income from other sources. However, if these tips are paid by an ...
Can the income of remuneration, commission and bonus received from a partnership firm by a partner be taxed as income from 'Salary'?
No. It has to be treated as and taxed as income from Business and Profession, as a partner is not an employee, but a part-owner and a shareholder in the profits and losses of the business.
I am a professional tutor. Incidentally, I teach regularly at a school as per the offer made by them and I get paid as per my hours of teaching work. Is my income liable to be taxed as income from Salary?
No. On these facts there doesn’t exist an employer-employee relationship since you get paid for your services and time spent. The income may be liable to be taxed as business income.
I receive a certain income from someone regularly at certain intervals. How do I determine whether it is income from Salary, other sources or business income?
An income can be taxed as income from Salary only when there is an employer-employee relationship. Your relation with the person paying income to you may be tested on the parameters:- 1. Whether the payer is in complete control of your activity 2. ...
How is Leave Travel Concession taxed?
If the employee is allowed a leave travel allowance or concession by his employer towards travel for himself and his family (includes spouse, dependent parents and siblings of the employee and his two children) in India, such an amount of allowance ...
Is it necessary for my employer to deduct income tax from my Salary?
Yes. It is his duty as per law to deduct tax from the income paid to you by him. This deduction is called TDS (Tax deducted at source). TDS is deducted each month by employers based on tax projections declared by the employee at the beginning of each ...
I am an employee of an Insurance Company. I am paid a commission or incentive on the business I bring to my company. How should this commission or incentive be treated?
Since in addition to Salary payable, you also receive incentive bonus/commission based on the insurance business brought by you, the additional income so derived during the course of and pursuant to the terms and conditions of the employment can be ...
I have received non-monetary perquisites from the employer on the value of which he has paid tax. Do I need to include this tax amount as a part of my Salary income?
No. The I-T Act provides option to the employer to pay tax on the non-monetary perquisites. However, by virtue of Section 10(10CC), tax paid by employer (on behalf of employee) on non-monetary perquisites will be exempt from tax in the hands of ...
What are allowances and how are they taxed?
Allowances are financial benefits given by the employer to an employee with a specific purpose. Some of them are for incurring expenses in discharge of duties by the employee. For example, there could be a travel allowance given for a job where ...
What are the different types of income that qualify as Salary under the Income Tax Act?
As a salaried person, you may be getting income in many forms. For the purpose of tax, the incomes that qualify as Salary are listed below: Salary: This is generally a monthly remuneration extended by the employer to the employee in exchange for the ...