â€¢ An employee should take the benefit of relief available under section 89 wherever possible. Relief can be claimed even in the case of a sum received from an unrecognised provident fund so far as it is attributable to the employerâ€™s contribution and interest thereon.
Although gratuity received during employment is not exempt from tax under section 10(10), relief under section 89 can be claimed. It should, however, be ensured that the relief is claimed only when it is beneficial;
â€¢ Pension received in India by a non-resident assessee from abroad is taxable in India, thus, such pension if first be received by or on behalf of the employee in a foreign country and later on remitted to India, it will be exempt from tax;
â€¢ The perquisite in respect of leave travel concession is not taxable in the hands of employees if stated conditions are fulfilled, and thus it should be ensured that the travel concession should be claimed to the maximum possible extent without attracting any incidence of tax;
â€¢ The perquisite in respect of residential telephone, providing use of computer/ laptops, gift of movable assets (other than computer, electronic items, car) by employer after using for 10 years or more, and free refreshment during office hours, are not taxable, employees can claim these benefits without adding to their tax incidence;
â€¢ Further, the term â€œsalaryâ€ includes basic salary, bonus, commission, fees and all other taxable allowance for the purposes of valuation of perquisite in respect of rent-free house, it would be better for employees to go for perquisite rather than for taxable allowances.
This will reduce valuation of rent-free house on the one hand, and, on the other hand, the employee may not fall in the category of specified employee.
â€¢ If a rent-free furnished or unfurnished accommodation is provided by the employer at confessional rent, deduction under section 80GG can be claimed if certain conditions are satisfied.
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