HRA Annual Exemption -INDIA

[Former Member]

Housing

Purpose

This component helps you create and maintain information on the employee accommodation. You can also compute the exemptions and perquisites applicable on a housing benefit.

Integration

·  Income Tax

During the computation of the annual exemptions and perquisites, the Income Tax functionality also includes the exemptions and perquisite wage types of the housing functionality.

· 

  HRA Annual Exemption

   /4E4 HRA Annual Exemption

  /131 Any other Income [House Prop.IT-584]    150,000.00-

Non Metro HRA Basis = Basic * 12 months =1amount 

12 months 10% = 1 amount

12 months amount of 581 -10% basic =2 amount =is Ans

  HRA Formula

/3R2 Non-metro HRA Amount             Missing one month i.e march

/3R4 Non-metro HRA Basis Amt               

• v Residence in metro - 50% of salary, elsewhere - 40%  [Basic salary 10000 * 40 %of basic =4000]
• v Actual H.R.A. received                                              [ IT-0008  HRA Amount =5000 ]
• v Excess of rent paid over 10% of salary.                      [10% basic salary – IT -581 Amount= 1000-3000  =2000]

            Above 3 Rules less amount =/4e4 Amount =2000*12 = /4e4= 24000

Configuration tables

• Housing code for taxation (V_T7INR1)

       Percentage/amount for housing related constant (V_T7INR3)

• Housing related statutory constants for taxation (V_T7INR5)

• Codes for Housing Types (V_T7INR7)

• City category for housing type (V_T7INR9)

Back end calculation of INHRA FUNCTION

Go to payroll log- Begin Gross to Net calculation-ELSE-INHRA

HRA exemption use full links

1-http://help.sap.com/erp2005_ehp_04/helpdata/en/29/22b91a0b184b9ab1015a8cd48f76a5/content.htm

2-http://help.sap.com/saphelp_afs64/helpdata/en/0d/bec6ba2cec4cf69e9ba5b43dbec440/content.htm

Cheers

Satish