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What is not included in salary for calculating the value of rent free accommodation for a public employee?

Salary includes all emoluments paid to an employee but excludes dearness allowance which is not included in the computation for retirement benefits, allowance which are exempt from tax, value of perquisites under section 17(2), employers contribution to PF and lump sum payments received on retirement.

What is free accommodation?

RFA or rent free accommodation is an arrangement where the employer gives the employee a residence to put up at without charging any rent. Sometimes, the cost of accommodation can also be at a concessional rate. This facility is offered by many employers to the employees in return for their services and expertise.

How can I earn tax free income?

7 Ways You Can Earn Tax-Free Income Contribute to a Roth IRA. The smartest way to earn tax-free income is simply by opening up and contributing to a Roth IRA. Sell your home. Invest in municipal bonds. Hold your stocks for the long-term. Contribute to a Health Savings Account. Receive a gift. Rent your home.

How much income is tax free in Germany?

The basic tax-free allowance (Grundfreibetrag) ensures that you only pay income tax on your annual income above a certain threshold. In 2021 the basic tax-free allowance is 9.744 euros and will be increased to 10.347 euros in 2022.

What is salary paid tax free?

# Salary paid tax free - Tax free salary means the salary on which income tax is borne not by the employee but by the employer. Tax free salary is also taxable in the hands of the employee. Salary is taxable in the year of receipt or in the year of earning of the salary income, whichever is earlier.

Is free accommodation taxable?

If an employee receives living accommodation which does not fall within the meaning of job-related accommodation, a taxable benefit may need to be calculated. The way in which the benefit is calculated will depend on whether the employer is renting the accommodation or if the employer owns it.

What do you mean by perquisites?

Perquisite may be defined as any casual emolument or benefit attached to an office or position in addition to salary or wages. Perquisite is defined in the section 17(2) of the Income tax Act as including: (i) Value of rent-free/accommodation provided by the employer.

What is an accommodation allowance?

Accommodation allowances where an overnight stay is required for work. Providing accommodation in exchange for work.

What would be the correct rule for the valuation of this perquisite?

Employees- The value of perquisite is an amount equal to 15% of the salary in cities having population more than 25 lakh, 10% of salary in cities where population as per 2001 census is exceeding 10 lakh but not exceeding 25 lakh and 7.5% of salary in areas where population as per Page 12 8 2001 census is 10 lakh or

What are examples of tax free income?

Disability Insurance Payments Any benefits you receive from supplemental disability insurance you purchased through your employer with your own after-tax dollars. Any benefits you receive from a private disability insurance plan you purchased with after-tax dollars. Workers compensation payments.

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