Itaxxsoftware.com: Automated H.R.A. Exemption Calculator U/s 10(13A)

House Rent Allowance (HRA) is generally considered as a part of the salaried persons and is generally added in the salary structure to help the individual to save taxes. House rent allowance conclusion is given under section 10(13A) of the Personal Tax Act as per Rule 2A of the Annual Tax Rules.

In the event that you stay in a rented house and get a HRA from your employer then you can claim partial exemption of House Rent Allowance on meeting the prescribed conditions:

1. What are the conditions to claim the House Rent Allowance(HRA) Derivation? The worker must satisfy the accompanying conditions to claim House Rent Allowance finding: The allowance must be specifically granted to the representative by his employer to meet expenditure actually incurred on payment of rent in respect of residential house involved by the assessee. The representative should not be the owner of the residential house involved by him. The worker must have actually incurred expenditure on payment of rent. It is necessary to have a relation of the representative and the employer.

2. Amount of Exemption in respect of House Rent Allowance is regulated by the rule2A. The least of coming up next is excluded from tax:

Major Urban areas Mumbai, Delhi, Calcutta, Chennai Other Urban communities Allowance received Rent paid more than 10 per penny of salary 50 per penny of salary Allowance received Rent paid more than 10 per penny of salary 40 per penny of salary

Download Automated IncomeTax Revised Form 16 Part B for the Financial Year 2019-20 and Assessment Year2020-21 [ This Excel Utility can prepare at a time 50 Employees Form 16 Part B]

3. How to calculate House Rent Allowance(HRA)? For registering HRA, salary means basic salary and incorporates dearness allowance, if the terms of work so provide. Salary shall exclude other allowances and perquisites.

Example: Mr A, who resides in Chennai, gets Rs. 6, 00,000 as a basic salary. He receives Rs. 1, 70,000 as house rent allowance (HRA). Rent paid by him is Rs. 1, 80,000. Discover the amount of exemption of house rent allowance.

Arrangement: The exemption will be worked out as follows: House rent allowance received for the year Rs. 1,70,000 half of salary Rs. 3,00,000 Rent paid less 10% of salary Rs. 1,20,000

HRA Calculator You can also register your HRA via this House Rent Allowance Calculator available on the official site of the Personal Tax Department From the Below Link

https://www.incometaxindia.gov.in/Pages/tools/house-rent-allowance-calculator.aspx

Or view your H.R.A. Exemption Amount by the below given Excel Based Software which can calculate your House Rent Exemption Amount as per Income Tax Act U/s 10(13A)

Download Excel Based Automated House Rent Calculator U/s10(13A)

Truly, you can claim HRA exemption. The main condition is that the rent should be paid to the spouse on a monthly basis. There is no legal requirement yet in such case rent should be paid through bank transfer. You have to prove that it was paid.

Download Automated IncomeTax Revised Form 16 Part B for the Financial Year 2019-20 and Assessment Year2020-21 [ This Excel Utility can prepare at a time 100 Employees Form 16 Part B]

HRA finding and Housing Loan Advantage 5. Can I claim house rent allowance exemption and housing loan exemption simultaneously? In the event that truly, then how? House rent allowance covered under section 10(13A) and housing loan exemption covered under section 24(1).

These are two different sections. Anyone can claim both advantages simultaneously. Assume, Mr. A lives in Delhi however because of work went to Mumbai. He gets house rent allowance from his employer and paid the rent to the landlord. He has his own house in Delhi and his family live in the house. He has taken a home loan on his own house..

New Tax Regime 7. Can I claim house rent allowance under the new tax regime which is applicable from the assessment year 2021-22? No, under new tax regime you are not allowed to claim house rent allowance. 8. Is mandatory to adopt new tax regime? No, it's not mandatory to adopt a new tax regime. It relies upon the individual as per the New Section 115 BAC for the F.Y.2020-21

Download and Prepare at a time Tax Computed Sheet as per New and Old Tax Regime U/s 115BAC + AutomatedArrears Relief Calculator U/s 89(1) with Form 10E + Automated Form 16 Part Aand B and Part B + Individual Salary Structure + Individual Salary sheet [This Excel Based Software can use both of Government Employees and Private Employees as the Salary Structure prepare as per the Government & Private Concerns Salary Pattern]

As we begin the new financial year, there was a demand for extension of FY 2019-20 to June 30, 2020, owing to the COVID – 19 outbreaks.

However, the Government has not announced any changes, which aptly reminds us of Sir Benjamin Franklin’s famous words,“Only two things are certain in life, death and taxes.” During this lockdown period, those who have amassed wealth for their future generations and those who earn their livelihood on a daily basis have come to a common ground. Though the world is open for everyone to live with their own choices, in today scenario, no one can walk freely as they wish. We all have different options to live here, however, it is our choice to choose the way of our life. As Bible reminds all have to be wise and prudent in selecting their choices. In the example of ten virgins – Five of them took their lamps and took no oil with them, the other five took oil in their vessels with their lamps. It simply indicates, be vigilant in selecting your choices. “Therefore keep watch, because you do not know the day or the hour”.

Through the Finance Bill 2020, Hon’ble finance minister Smt. Nirmala Sitharaman introduced a new taxation structure in India, Option A, Live today! lower tax rates for those who don’t want to have tax saving plans, and giving more cash flows to their hands. On the other side, option B, with higher tax rates for those who have tax saving plans. This makes you take the call on your own taxation. While Option A looks nice and easier, is this giving a lower tax benefit? Taxpayers have to be more cautious and practical in selecting their choices.

Wishing you a smart and successful Financial Year and Prudent tax planning!

Salient features of Income-tax calculator for salaried employees- F.Y. 2020-21

1. Useful for the salaried employees of the government and private sector.

2. Private sector employees can use their Flexi allocation option and link it to tax planning.

3. Tax and rebate/deduction calculation for all type of income, to arrive at the annual tax liability.

4. Marginal relief on the surcharge, where income crosses the prescribed limits.

5. Automated HRA exemption/Sec 80GG deduction calculation based on the salary and rent payments.

6. Validation on the limits of Chapter VI A the deduction, Housing loan interest set off.

7. Best tax regime suggestion for the taxpayers.

8. Highlights of tax changes when the taxable income crosses 50 Lakh/1 Crore.

How do you select the tax regime/method?

The new tax regime is simple; Tax rates are lower than the old regime. This is a better option for those who do not have tax plans, not paying rent or not having any housing loans.

The Old tax regimecan be used for all those have tax-saving investments, pay rent, have housing loans and so on.

It is interesting that the National pension scheme contribution through an employer is deductible under both the regime. A tax-free, long term, investments.

However, suggest for you to check the better option before taking a final decision on the tax method/regime. Do check which exemptions and deductions you are eligible for. Then do the calculations on whether your tax liability will be lower in the new regime or the old one.

When do you select the option? Income tax act allows you time till your personal tax return filing in 2022, however, you will have to communicate your option to the the employer in April/May, the same can be changed before they finalise the tax plans with the actual proof validation before the financial year closure.