Page 172 - DCOM301_INCOME_TAX_LAWS_I

Pooja, Lovely Professional University
Unit 7: Income under the Head Salaries

Unit 7: Income under the Head Salaries Notes

CONTENTS
Objectives
Introduction

7.1 Definition of Salary
7.2 Basis of Charge of Salary
7.2.1 Due Basis of Taxation

7.2.2 Employer and Employee Relationship
7.2.3 Other Points for Consideration for Taxability of Salary
7.3 Allowances
7.3.1 Fully Taxable Allowances
7.3.2 Partially Exempt Allowances

7.3.3 Fully Exempt Allowances
7.4 Perquisites
7.5 Types of Perquisites

7.5.1 Tax-free Perquisites
7.5.2 Taxable Perquisites (In all Cases)
7.5.3 Perquisites Taxable only in the Cases of Specified Employees
7.6 Valuation of Perquisites
7.7 Profits in Lieu of or in Addition to Salary

7.7.1 Gratuity
7.7.2 Commuted Value of Pension
7.7.3 Encashment of Earned Leave

7.8 Deductions Allowed from Salaries (Section 16)
7.9 Summary
7.10 Keywords
7.11 Review Questions
7.12 Further Readings

Objectives

After studying this unit, you will be able to:
Define the Salary

Discuss the Basis of charge of salary
Describe the Allowances and Perquisites

LOVELY PROFESSIONAL UNIVERSITY 167