Salary Income

Income from Salary- S.15-17 - By Kumar Gaurav

Important : Though every care has been taken while drafting this material, the author of the material is not responsible for consequences of any action taken on the basis of this material. Classification of Income under various heads : S.14 Classification of Income under various heads necesaary as there are different rules for computing income under different heads. Heads of Income : * Income from Salary -S .15-17 *Income from House Property - S.22-27 *Profits & gains from Business/Profession- S.28-44d *Capital Gains-S.45-55 *Income from Other Sources-S.56-59 Prerequisite for taxing income under this head : * Employer-Employee r'ship Pts to be kept in mind while computing income under this head: *Salary foregone is application of income and hence would be liable to tax. *Voluntary Suurender of Salary under Voluntary Surrender of Salary(Expemtion from Taxation)Act, is exempt from tax *Tax free salary >Tax paid by employer-as per employment terms- Taxable as Salary >Otherwise taxable as perquisite. *No difference between wages & salary from taxability point of view. *Salary is deemed to accrue/arise at place where services are rendered-S.9(1) **Exception: In case of following income is deemed to accrue/arise in India. >*indian citizen*gvt. Employee*services rendered outside india Chargeability-S.15- Following income chargeable u/h Salary:

a)Salary due from

Former Employer

in PY, whether paid/not in PY

Current Employer

b)Salary paid/allowed by/on behalf of

Former Employer

in PY, whether due/not in PY

Current Employer c)Arrears paid/allowed in PY not charged to tax in any earlier Pys. Conclusion: Salary taxable on receipt/accrual basis whichever is earlier.

Income from Salary

1

Kumar Gaurav