Income tax Calculation Example 5 for Salary Employees 2023-24

Income tax Calculation Example 5 For Assessment Year 2023-24 – Example 5

Example 5

For Assessment Year 2023-24
Illustrating valuation of perquisite and calculation of tax in the case of an employee below age of sixty years of a private company in Mumbai who was provided accommodation in a flat at concessions rate for ten months and in a hotel for two months (With valid PAN^ furnished
to employer).

S.No.ParticularsRupees
ISalary7.00,000
2Bonus1,40,000
3Free gas, electricity, water etc. (Actual bills paid by company)40,000
4(a)Flat at conccssional rate (for ten month). @
Rs.36000/month
3,60, 000
4(b)Hotel rent paid by employer (for two month)1,00,000
4(c)Rent recovered from employee.60,000
4(d)Cost of furniture.2,00,000
5Subscription to Unit Linked Insurance Plan50,000
6Life Insurance Premium10,000
7Contribution to recognized P.F.42,000

COMUTAT1ON OF TOTAL INCOME AND TAX PAID THEREON:

S.No.ParticularsRupees
ISalary7,00,000
2Bonus1,40,000
3Total Salary( 1+2) for Valuation of Perquisites8,40,000
Valuation of perquisites
4(a)Perquisite for flat (Cities having population>25 lalch as per 2001 census)
15% of salary for 10 months=Rs.1,05,000/-
1,38,600
Perquisite for hotel:
Lower of (24% of salary of 2 months=Rs 33,600) and (actual payment= Rs 1,00,000) i.e. Rs 33,600
4(c)Perquisites for furniture @ 10% of cost (10% of Rs. 2,00,000) Rs. 20,000
4(c)(i)Total of 14(a)1-(b)+(c)I
(1,05,000+ 33,600+ 20,000) = Rs.158,600
Less: rent recovered: (-)Rs. 60,000
=Rs.98,600
4(d)Add:
Perquisite for frec gas, electricity, water etc. Rs.40,000 (+) Rs 98,600 (4(c)(i)] = Rs1,38,600
Total perquisites
5Gross Total Income (Rs.8,40,000H- 1,38,600)9,78,600
6Less: Standard deduction u/s 16(ia)50,000
7Gross I Mal Income9.28.600
8Less: Deduction Us 80C:
(i). Provident Fund (80C) : 42,000
(ii)LIC (80C) : 10,000
(iii)Subscription to Unit Linked Insurance Plan(80C): 50,000/- Total =102,000
Restricted to Rs 1.02.000 tits SW
1.112,000
9Total Income8.26,600
10Tax Payable77,820
IIAdd:
Health & Education Cess @ 4%.
3113
12Total Income Tax payable80,933

or Aadhaar number, as the case may be.
# It may be noted that tax liability may not be the same in case the taxpayer opts for concessional tax regime under section 115BAC of the Act.A40

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