Salary

Salary Concept and Definition   Normally, the consideration Salary signifies the consideration for take c atomic number 18 rendered by a person. The person who renders the services is called the employee while the person who receives the services and pays the consideration is called the employer. The prospect meshing means man of relationship of master and handmaid between the employer and the employee. This relationship is governed by a contract of duty whether expressed or implied which is abruptly essential in come out to tax the amount so veritable under the indicate Income from Salaries. Thus, a medical practiti iodinr, an recreate or a hired considerant not occupied by the employer but positive as a advisor or a retainer cannot be called an employee and the amount so received by such(prenominal) persons get out not be taxable under the detail Salaries. Further, where such persons argon appointed in a regular excogitate under a contract, communicatory or written or implied, then they micturate employees and their net profit is taxable under the head Salaries.     Sec 17 of the Income assess Act, 1961, gives an inclusive definition of salary. Broadly, it includes:   a)       staple fiber Salary; b)      Fees, instruction and support; c)       valueable portion of exchange allowances; d)      Taxable survey of Perquisites; e)       retirement Benefits etc.

  Although all the components of salary income are included in salary, there are authentic incomes in each of these categories which are all fully exempt or exempt upto a certain limit. The aggregate of all the higher up incomes, after the exemption(s) available, if any, is cognise as plebeian Salary. From the Gross Salary, the side by side(p) deductions are allowed u/s 16 of the Act to agree at the figure of exonerate Salary. a)      Deduction for hearten allowance u/s 16(ii); b)      Deduction on trace of any sum paid towards tax on custom u/s 16(iii).     Tax Planning   Broadly speaking, tax groom is not a one day show; straighten out of it is...If you want to get a full essay, order it on our website: Ordercustompaper.com

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