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Prepared By:
Reena Ahuja (08061)
Sulabh Maheta (08084)
Amin Pattani (08100)
 alue of Leave Travel
Concession in India [Sec. 10(5)]
Õ LTC received by employees from their employers
for preceding to any place in India.

Õ The benefit is available to individuals - citizens as

well as non citizens.

Õ Limit of exemptions

Õ Monetary limits
a ample:

Mr. X went on holiday on 25.12.2006 to Delhi with

his wife and three children (one son ² age 5 years;
twin daughters - age 2 years). They went by flight
(economy class) and the total cost of tickets
reimbursed by his employer was Rs60,000 (Rs45,000
for adults and 15,000 for the three minor children).
And
If among his three children the twins were 5 years
old and the son 3 years old.
 a emption in the case of
individuals, who are not citizens of
India [Section 10(6)]

(i) Section 10(6)(ii) grants exemption to a person in

respect of the remuneration received by him for
services as high commission, legation, consulate
or the trade representation of a foreign State or
as a member of the staff of any of these officials.
Cont«..

Conditions:

(a) The remuneration received by our

corresponding Government officers resident in
such foreign countries should be exempt.

(b) The above ² mentioned officers should be the

subjects of the respective countries and should
not be engaged in any other business or
profession or employment in India.
(ii) Section 1010((6)(vi) provides that remuneration
received by a foreign national as an employee of a
foreign enterprise for service rendered by him during
his stay in India is also exempt from tax.
tax.

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(iii) section 10(6)(viii) provides that employee who is also
non-resident for services rendered in
connection with his employment on a
foreign ship where his total stay in
India does not exceed a total of 90
days in the previous year.
(iv) Section 10(6)(xi) provides that any remuneration
received by employees of foreign
Government from their respective
Government during their stay in India
in connection with their training in
any establishment or office of the
Government or any public sector
undertaking is exempt from tax.
 Allowances payable outside India
[Sec. 10(7)]

Allowances or perquisites paid or allowed as

such outside India by the Government to a
citizen of India for services rendered outside
India are exempt from tax.
tax.
 Co-operative technical assistance
programmers [Section 10(8) and 10(9)]

Individuals who are assigned duties in India in connection with

any co-operative technical assistance programs and projects
would be exempt from tax on their receipts by way of:

(a) Remuneration received directly or indirectly from the

Government of a foreign State for rendering such
services;

(b) Any other income accruing or arising outside India in

respect of which the individual is required to pay income
tax or other social security tax to the Government of that
foreign State.
 Consultant remuneration
[sec. 10(8A) and (8B)]
^nder clause (8A), any remuneration or fee received by a
consultant, directly or indirectly, out of the funds made
available to an international organization (agency) under a
technical assistance grant agreement with the agency and
Government of the foreign state is exempted from income
tax.

^nder clause (8B), the remuneration received by an employee

of the consultant is exempted from income tax provided such
employee is either not a citizen of India or, being a citizen of
India, is resident but not ordinarily resident and the contract
of his service is approved by the prescribed authority before
the commencement of his service.
 Úratuity [Sec. 10(10)]

1) Retirement gratuity received under the Pension

Code Regulations applicable to members of the
Defence Service is fully exempt from tax.
2) Central / State Government Employees
3) Non government employees covered by the
Payment of Gratuity Act, 1972
4) Non government employees not covered by the
Payment of Gratuity Act, 1972
 a ample:
Mr. X retired on 15.06.2006 after completion of
26 years 8 months of service and received gratuity
of Rs. 6 lakh. At the time of retirement his salary
was;

Basic salary: Rs. 5000 p.m.

D.A. : Rs.3000 p.m.

Find his taxable gratuity assuming;

1. He is non-government employee and covered by
the payment of gratuity act 1972
2. He is non-government employee and no covered
by the payment of gratuity act 1972
3. He is a government employee
 Payment of commutation of
pension [Sec. 10(10A)]
Pension is of 2 types

1. Commuted Pension
2. ^n-commuted Pension

A) Employees of the central government/local

authorities/statutory corporation/members of
the defence services
B) Non government employee
 a ample

Mr. X retired on 01.10.06 receiving Rs. 5000 p.m. as

pension. On 01.02.07, he commuted 60% of his
pension and received Rs. 3 lakh as commuted
pension. Required to compute his taxable pension
assuming:
1) He is government employee
2) He is non government employee, receiving
gratuity of Rs. 5 lakh at the time of retirement
3) He is non government employee and is in
receipt of no gratuity at the time of retirement