If you have received arrears of salary in Financial year 2012-13 then your tax liability will be on higher side due to arrears but do you know that you can bifurcate your income in respective years on notional basis and can avail relief u/s 89(1) of Income tax Act ,1961.We have prepared a small excel calculator which will be helpful in calculate the relief under 89(1) for arrears received in financial year 2012-13 and relates maximum older up to financial year 2005-06.This calculator can be used online or can also be downloaded for offline use.
How it works
This calculator show two calculation one is on the basis of the receipt of salary and other is on the basis of relevant years and if tax on receipt basis is more than 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.
- You have to fill only yellow column only .after each entry an updating sign will be shown,after disappearance of the sign then only enter next data.
- All yellow cell are not mandatory fill only which are required.fill zero where no figures are required
- This calculator will not work where in any of the previous year there is Long term capital gain .
- This calculator will show incorrect result if status of person changed during above said period from senior citizen from non senior citizen.
Section 89. Where an assessee is in receipt of a sum in the nature of salary, being paid in arrears or in advance or is in receipt, in any one financial year, of salary for more than twelve months or a payment which under the provisions of clause (3) of section 17 is a profit in lieu of salary, or is in receipt of a sum in the nature of family pension as defined in the Explanation to clause (iia) of section 57, being paid in arrears, due to which his total income is assessed at a rate higher than that at which it would otherwise have been assessed, the Assessing Officer shall, on an application made to him in this behalf, grant such relief as may be prescribed
Specified DDO CAN ALLOW RELIEF U/s 89(1)
Following employer may allow benefit u/s 89(1) if claimed by employee.
6.association or body
7.Govt State or center
8.Public sector undertaking
Download 89(1) relief calculator for Financial year 2012-13
To download this calculator fill below form and download link will be shown.Two file will be shown for download ,you may download both .
- In first file you can select Male/Female/Senior citizen option in each year.
- In Second file you can select Male/Female/Senior citizen once and the same status will apply in all the years(Fy2005-06 to FY 2012-13)