If you have
received arrears of salary/pension in the Financial year 2020-21 related to the previous year(s) then your tax liability will be on the higher side due to arrears
but do you know that you can bifurcate your income from arrears in
respective years on notional basis and can avail relief u/s 89(1) of Income-tax
Act,1961.
We have
prepared an Automated Excel Based Calculator with Form 10E From the Financial The year 2000-01 to Financial Year 2020-21 ( Update Version) which will be helpful
in calculating the relief under 89(1) for arrears received.
How it
works
This the calculator shows two calculation of Income Tax, one is Tax on the basis of the
receipt of salary/arrears and other is Tax on the due basis of relevant years
and if the tax on receipt basis is more than due relevant years basis then relief
under section 89(1) will be available otherwise nothing is available means no
benefit in distributing the arrears in respective years.
How to Use.Note /Faq on use of Calculator
You have to fill only the White Cell. (For online version-After
each entry an updating sign will be shown, after the disappearance of the sign only
then enter next data.).If arrears are related to few years than years provided in
the sheet, fill zero in other non-required years.
All white cell is not mandatory to fill only which are
required. Fill zero where no figures are required
Fill M for male and F for female (This calculator is not working for senior citizen above 60
years). You must select the status each year.
Make sure that status has been selected correctly
Fill Taxable Income excluding arrears, including all other
income and after all the deduction like section 80C,80CC,80D,80G,80U etc.
Fill year-wise break up of arrears received in the Financial
year 2020-21 under respective years. Total will automatically be shown under The financial year 2020-21.
If any Arrears received under the Financial year 2020-21 is
protected and can not be edited, If you have received arrears related to The financial year 2020-21 in the Financial year 2020-21 itself then it is not
covered under the definition of arrears and to be included in the total income of The financial year 2020-21.
The result is out if total A >Total B then relief under
section 89(1) will be shown, otherwise, 0 will be shown. Further Form 10E with
relevant annexure will also be filled automatically including table-1
Limitations
after filling the Master Data input sheet all calculation will be calculated
automatically as per the each relevant Financial Year’s Tax Slab.
Download 89(1) relief calculator with Form 10E From the F.Y. 2000-01 to F.Y. 2020-21 ( fully automated Software in Excel and prepared as per the Finance Budget 2020)
