INCOME TAX

ASSESSMENT YEAR 2023 - 24

INCOME FROM SALARY

Problems on Calculation of Basic Pay

1. Calculate the total basic pay for the previous year 2022-23 if the basic pay on 1st April
2022 is Rs. 10,000 and annual increment is Rs. 950 due on 1st October.

2. Basic pay on 1-4-2022 is Rs. 11,200 and increment is due on 1-2-2023 with Rs. 850.
Calculate the total of basic pay for the previous year 2022-23.

3. Sri. T.K. Devendra joined as an Accounts Officer in a limited company on 1-8-2017 in the
scale of Rs. 12,400 - 500 - 14,900 - 800 - 17,000. After completing 3 years of service, he
was granted one extra increment. Calculate the total basic pay for the previous year 2022-
23.

4. Dr. Rahul is working as a Junior Scientific Officer in the pay scale of Rs. 14,000 - 875 -
17,500 - 1,000 - 25,500 - 1,400 - 33,900 since 1-9-2015. On 1st September 20120, he
was promoted as the senior scientific officer by giving two additional increments in addition
to normal increment. Calculate the total basic pay for the year 2022-23.

5. Mr. Ronak is employed in a limited company as a senior marketing officer. He gives you
the following particulars of income for the previous year 2022-23.
Basic pay in the scale of Rs. 3,000 - 200 - 3,600 - 400 - 6,600 - 600 - 9,100 from 1st
August 2016. Calculate the total basic pay for the year 2022-23.

Problems on Allowances

1. Smt. Sravanthi is working as an officer in Andhra Pradesh Government. Her salary

particulars are basic pay Rs. 11,000 per month, CCA Rs. 900 per month, Entertainment
allowance Rs. 1,000 per month. Compute the amount of entertainment allowance to be
allowed as deduction.

2. Sri Rajendhar age 45 years is working in ministry of Home Government of India and his
wife Smt. Nirmala Ghosh ag 40 years is working in ministry of Foreign Affairs,
Government of India. Their monthly salary particulars are given below :

Pay per month Basic DA HRA Entertainment CCA

(Rs) Allowance
Sri Rajendhar 28,000 50 % 20 % 13,000 2,000
Smt. Nirmala Ghosh 55,000 50 % 20 % 15,000 2,000

Both of them wants to claim deduction u/s 16 (ii), is it possible or not. Give your note as
an I.T.O.
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3. Mr. Raghu is working as lecturer in a Government college Surat for the last 25 years. His
monthly salary particulars are as under : Basic Pay Rs. 8,000, DA Rs. 5,000, Education
Allowance to his children Rs. 800, Entertainment Allowance Rs. 1,200. On 1 st January
2023, he retired and joined in a private college as lecturer for the same pay. Calculation
deduction to be allowed u/s 16 (ii).

4. The following are the income particulars of Mr. Jeevan Sai for the previous year relevant to
the current assessment year. Basic Pay Rs. 14,000 p.m. ; DA Rs. 1,800 p.m. ;
Entertainment Allowance Rs. 3,000 p.m. Calculate the amount of deduction allowed in the
following cases u/s 16 (ii).

(a) If he is a Government Employee.

(b) If he is a Non-Government Employee.
(c) If he is a local authority / municipal employee and the actual amount spent towards
entertainment expenses Rs. 2,000 per month.
(d) If the entertainment allowance was granted for official purpose.

5. Mrs. Sravani Rai is working as a lecturer in a Government College, Delhi. Her salary
particulars per annum are as under : Basic pay Rs. 80,000 ; DA Rs. 38,000 ; CCA Rs.
16,000 and HRA Rs. 23,000 (rent paid by her is Rs. 21,000). Calculate the exempted
amount of HRA.

6. Mr. Sahdev is in receipt of Rs. 1,62,000 as basic salary. Rs. 56,000 as House Rent
Allowance and Rs. 27,000 as Dearness Allowance. If the rent paid is Rs. 62,000.
Determine the taxable amount of house rent allowance in the following situations :

(i) If he is a Government Employee and residing in Mumbai.

(ii) If he is a Non-Government Employee and residing in Mumbai.
(iii) If he is residing in Hyderabad city.
(iv) If he is residing in Madurai city and staying in father-in-law’s house without paying
any rent.

7. Sri Srujan Kapoor is an employee of a limited company at Jamshedpur, is in receipt of Rs.

44,000 as basic pay, Rs. 18,000 as Dearness Allowance forming part of salary for all
retirement benefits. Rs. 6,000 as City Compensatory Allowance, Rs. 8,800 as
Accommodation Allowance, Rs. 12,000 as Entertainment Allowance. He is paying a
monthly rent of Rs. 1,500 and electricity bill of the house at a flat rate of Rs. 300 per
month. Determine the amount of House Rent Allowance exemption u / s 10 ( 13 A ).

8. Md. Yousuf Khan is an employee of a public sector unit in Hyderabad. He draws a monthly
salary of Rs. 4,800, House Rent Allowance Rs. 1,600, Dearness Allowance is Rs. 1,000.
He is entitled to 2 % commission on the sales. The sales target achieved by him is Rs.
5,00,000. The house rent paid by him is Rs. 1,100 per month. Dearness Allowance and
Commission enters for retirement benefits. Compute the amount of the HRA to be
included in salary income and gross income from salary.

9. Find out the amount of house rent allowance, which shall be included in the income
under the head salary in each of the following cases :
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(a) Basic Pay Rs. 10,000 p.m., House Rent Allowance Rs. 2,000 p.m., Entertainment
Allowance Rs. 3,000 p.a. Dearness Allowance is 15 % of basic (Actual rent paid
is Rs. 2,000 p.m. in Guntur)
(b) Basic Pay Rs. 16,100 p.m.; D.A. 18 % ; H.R.A. 20 % ; Rent paid per month in
Nagpur Rs. 4,500 p.m.
(c) Monthly emoluments : Basic Pay Rs. 7,800, D.A. Rs. 2,000, CCA Rs. 1,500,
House Rent Allowance Rs. 4,000. He is paying a monthly rent of Rs. 2,500 in
Delhi.
(d) Yearly emoluments : Basic Pay Rs. 2,80,000 ; House Rent Allowance Rs. 63,000 ;
DA Rs. 90,000 (enters for retirement benefit of gratuity only). Rent paid is Rs.
2,500 p.m.

10. Sri Jaya Janarthan Reddy working in Madurai city received the following emoluments
during the financial year 2022-23.
Basic Rs. 65,000 p.m. ; DA Rs. 21,000 p.m. and HRA Rs. 13,000 p.m. He took an
accommodation in Madurai city on a monthly rent of Rs. 12,000 but not yet occupied the
house and staying in father-in-law’s house in the same street. Calculate the taxable
portion of HRA.

11. From the following particulars, calculate gross income from salary of Mr. Chidambaram
Government employee working in Delhi for the assessment year 2023-24.
Basic Pay Rs. 26,800 p.m. ; DA 45 % ; HRA 12.5 %. He took a house on rent @ Rs.
4,200 p.m. but due to some litigation with the land lord rent is not paid for the last 4
months of the year.

12. From the following particulars compute taxable HRA of Mrs. Arundathi who is working in
Indore city in a limited company. Her salary income particulars per month are Basic Rs.
42,000 ; DA Rs. 16,000 ; HRA Rs, 32,000 ; Rent paid by her Rs. 7,000 p.m. ; On 1-7-
2022, she got an increment in salary @ 13 % in basic and all allowances. On 1-9-2022,
she had been transferred to Mumbai city and rent paid by her Rs. 29,600 p.m. On 1-3-
2023 she bought a flat in Mumbai and shifted her residence to the new house.

13. Sri. L.N. Sharma is working in a limited company in Guntur. His salary particulars per month
are : Basic Rs. 12,000 ; DA Rs. 3,000 ; CCA Rs. 2,000 ; Transport Allowance Rs.
1,900. Calculate the taxable amount of transport allowance.

14. Calculate taxable portion of Mr. Kanappa transport allowance in the following two situations.
(a) Assessee is a physically handicapped person.
(b) Assessee is a normal person.
Basic pay Rs. 7,500 p.m. ; Bonus Rs. 5,000 p.a. ; Transport Allowance Rs. 3,000 p.m.
(actual amount spent Rs. 1,000 p.m.)

15. Sri Venkateshwar Rao is working as a lecturer in Lucknow. His salary particulars are as
under :
Basic Pay Rs. 32,000 p.m. : DA Rs. 14,000 p.m. : Conveyance allowance Rs. 4,200
(actual amount spent Rs. 3,200) ; Children education allowance Rs. 2,000 p.a. per child
for his three children. Calculate the exemption to be allowed for allowances and compute
gross income from salary.
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16. Sri Rajesh Agarwal is working in a limited company in Surat. His salary particulars are as
follows :
Basic Pay Rs. 16,000 p.m. ; DA Rs. 2,700 p.m. ; Children Education Allowance to his
daughter Rs. 1,500 p.m. Hostel allowance to his son Rs. 5,000 p.m. (actual amount
spent Rs. 2,000 p.m.). Calculate gross income from salary.

17. From the following particulars of income of Mr. Mahesh who is working in a multi national
corporation, in Bangalore. Compute gross income from salary . Details of pay (per month
in Rs) : Basic 13,000 ; DA 8,000 ; Travelling allowance 3,000, 35 % is spent ; Academic
allowance (p.a.) 15,000 (actual amount spent 9,000)