1. Tax Exemption from Salary Arrears | How to file Form 10E in the new tax portal Let's try to
understand the calculation of arrears, relief dated 21.06.2021 on Sec 89 and how to file Form 10E to
2. Illustration:
Mr Pabir Mahato received arrears of salary in the financial year 2011-2012. The
arrears are related to the salaries of FY 2017-18, FY 2018-19, FY 2019-20. The
details are as follows:
|
Sl |
Particulars |
Financial Year |
Assessment Year |
Amount (Rs.) |
Amount( Rs.) |
|
a |
Taxable
Salary |
2020-21 |
2021-22 |
|
8,00,000 |
|
b |
Arrears
for the year |
2017-18 |
2018-19 |
75,000 |
|
|
c |
Arrears
for the year |
2018-19 |
2019-20 |
1,00,000 |
|
|
d |
Arrears
for the year |
2019-20 |
2020-21 |
1,25,000 |
|
|
e |
Total
Arrears (b+c+d) |
|
|
|
3,00,000 |
|
f |
Total
Salary (including Arrears (a+e) |
|
2021-22 |
|
11,00,000 |
|
g. |
Tax
(including H&E Cess) on total salary including arrear ( Tax on income
(f)) |
|
2021-22 |
|
1,48,200 |
|
h. |
Tax
(including H&E Cess) on total salary without considering arrear (
Tax on (a)) |
|
2021-22 |
|
75,400 |
|
i |
Additional
Tax due to Arrears (g-h) |
|
2021-22 |
|
72,800 |
3. Reliable
calculations under section 89 (1) It is advisable to make the following
calculations and keep the statistics ready before filing Form 10E in the new
income tax portal. The new income tax portal is giving wrong tax calculations
which can be edited and corrected according to the pre-calculated amount.
|
Sl |
PARTICULARS |
FY
2017-18 (AY
2018-19) |
FY 2018-19 (AY 2019-20) |
FY 2019-20 (AY 2020-21) |
|||
|
Before
Arrears |
After
Arrears |
Before
Arrears |
After
Arrears |
Before
Arrears |
After
Arrears |
||
|
a |
Total
Income (Rs.) |
575000 |
575000 |
600000 |
600000 |
675000 |
675000 |
|
b |
Arrears |
|
75000 |
|
100000 |
|
125000 |
|
c |
Total
Income (a+b) |
575000 |
650000 |
600000 |
700000 |
675000 |
800000 |
|
d |
Deductions |
150000 |
150000 |
150000 |
150000 |
150000 |
150000 |
|
e |
Net
Taxable Income(c-d) |
425000 |
500000 |
450000 |
550000 |
525000 |
650000 |
|
f |
Tax
Liability * |
9013 |
12875 |
10400 |
23400 |
18200 |
44200 |
|
g |
Taxon
Arrear (tax after arrears- before arrears) |
3862 |
13000 |
26000 |
|||
|
h |
Total Tax
on Arrears in respective years |
If the
amount is received in respective years, the tax liability would be Rs 3862+13000+26000
= Rs 42,862 |
|||||
|
i |
Additional
Tax Liability due to late receipts of amount Rs.
72,800-42,862 = Rs. 29938/- |
||||||
