HRA Calculation For Income Tax Exemption

House Rent Allowance Calculation for Tax Exemption

House Rent Allowance is a Tax Free Income under Section 10(13A) of the Income-tax Act, subject to the following conditions

House rent allowance [Section 10(13A)] of the Income-tax Act

As per section 10(13A), read with rule 2A of the Income-tax Act, the exemption in respect of HRA will be lower of the following amounts:

(1) 50% of salary, when residential house is situated at Mumbai, Kolkata, Delhi or Chennai and 40% of salary where residential house is situated at any other place.

(2) HRA actually received by the employee in respect of the period during which rental accommodation is occupied by the employee during the previous year.

(3) Rent paid in excess of 10% of salary.

Salary will include basic salary, dearness allowance forming part of salary while computing all retirement benefits and commission based on fixed percentage of turnover achieved by the employee. Apart from this, salary for this purpose does not include any other allowances/perquisites.

Salary for this purpose shall be computed on due basis in respect of period during which the accommodation is occupied by the employee in the previous year. Hence, any payments not pertaining to the previous year or not pertaining to the period of occupation of the accommodation shall be excluded

[As amended by Finance Act, 2017]

7th CPC - Special Incident, Investigation And Security Allowance In The Report Of Committee

7th Pay Commission Report | Special Incident / Investigation / Security Allowance

Special Incident / Investigation / Security Allowance (Para 8.17.121-122)

Existing Provisions: This allowance is provided to personnel of special security forces, both as compensation for risk and hardship as well as an incentive to attract talent, as under:

 

Granted to personnel of	Present Rate
SPG (Operational Staff)	50% of (BP+DA)
SPG (Non-Operational Staff)	25% of (BP+DA)
NSG	25% of (BP+DA)
NIA (Executive Staff)	25% of (BP+DA)
NIA (Non-Executive Staff)	15% of (BP+DA)
CBI (Officers up to the level of SP)	25% of BP
CBI (Officers of the rank DIG and above)	15% of BP
CBI (Non-Executive Cadres)	15% of BP
IB	15% of BP
RAF of CRPF	10% of BP

Recommendations of 7th CPC: The following structure of Special Security Allowances is recommended:

No new categories of staff in other organizations may be made eligible for the grant of this allowance based on these recommendations. No Deputation (Duty) Allowance will be applicable along with this allowance.

The Commission has also recommended Special Security Allowance @20% of Basic Pay to R&AW.

Demands:

I. Special Protection Group (SPG): There is a need to enhance the existing formula and rate of the Special Security Allowance be revised to 60% and 30% plus DA thereon for Ops and Non-Ops categories respectively.

II. Department of Revenue: Special Incentive / Security Allowance may be given to Enforcement Directorate, Financial Intelligence Unit (FIU), India, DRI at par with the CBI.

III. Chairman, NTRO: Special Allowance of 15% of the Basic Pay is granted to NTRO employees since its inception. However, 7th CPC has made no recommendations regarding NTRO. Therefore, SSA should be granted to NTRO and be enhanced from 15% to 20%.

IV. National Disaster Response Force: NDRF allowance to personnel of NDRF at par with SPG, NSG and IB.

V. Intelligence Bureau: Special Security Allowance be allowed @25% of Basic Pay + DA.

Analysis and Recommendations of the Committee:

The Committee notes that the 7th CPC has recommended that no new categories of staff in other organizations may be made eligible for the grant of this allowance based on these recommendations.

The Committee also notes that this allowance has been granted to Enforcement Directorate as an ad – hoc measure with the approval of Department of Expenditure pending recommendations of the 7th CPC. Further, the Department of Revenue has sent the file that DRI and FIU (India) also be allowed this allowance at par with ED. The 7th CPC, in Para 11.18.109 of the Report, has recommended that Department of Revenue should assess the risk profile of the officials of the ED at various levels and thereafter make a case to Ministry of Finance for grant of Risk and Hardship Allowance, if any, as per appropriate cell.

It has been brought to the notice of the Committee that employees of National Technical Research Organization (NTRO) have been getting this allowance but have not been mentioned in the Report.

Therefore, it is recommended that:

(i) The Department of Revenue should assess the risk profile of the officials of the ED at various levels and thereafter make a case to Department of Expenditure, Ministry of Finance for grant of Risk and Hardship allowance, if any, as per appropriate cell. In the meantime and taking into consideration the fact that the 7 th CPC has not recommended this allowance for ED, it may be withdrawn as it was approved as an ad-hoc measure by the Department of Expenditure and was to the recommendations of the 7th CPC in this regard.

(ii) Officers / Officials of NTRO be allowed this allowance @20% of Basic Pay only as they appear to have been inadvertently left out from the list.

The additional financial implication on account of the changes proposed by the Committee is estimated to be ₹ 1.25 crore per annum and will benefit approximately 1081 personnel of NTRO.

7th CPC - Special Running Staff Allowance In The Report Of The Committee

7th Pay Commission Committee Report | Special Running Staff Allowance

Special Running Staff Allowance (Para 8.11.15, 11.40.62)

Existing Provisions: This allowance is granted to Running staff on account of more onerous nature of work as well as process of selection involved. The extant rates are:

Loco Pilot (Passenger), Mail Guard @ Rs.500 pm + DA

Loco Pilot (Mail/Express) @ Rs.1000 pm + DA

Recommendations of 7th CPC: Special Running Staff Allowance should be raised to Rs.2,250 pm for Loco Pilot Mail / Express, Rs.1,125 pm to Loco Pilot Passenger/Motormen and Rs.1,125 for Guard Mail/Express. In addition, Loco Pilot Goods and Sr. Passenger Guard should also be extended this allowance at the rate of Rs.750 pm. Dearness Allowance will be payable on this allowance but it will not count for pensionary benefits.

Demands:

I. Ministry of Railways:

i. Special Running Allowance (Additional Allowance for Running Staff) be revised from Rs.2250/- pm to Rs.3000 pm and Rs.1250/- pm to ₹1500/- pm for Loco Pilot (Mail / Express) and Loco Pilot (Pass.) respectively as erstwhile distinct cadres and pay scales of LP (M/E) and LP (Pass) and LP (Goods) were merged into Grade Pay of Rs.4200 by 6th CPC and proposal for grant of Grade Pay Rs.4600 to LP (M/E) has not been accepted.

ii. This allowance be called Additional Allowance as earlier and not Special Running Allowance.

II. All India Guards Council: Special Running Staff Allowance may also be allowed to the Goods Guards.

Analysis and Recommendations of the Committee:

In the deliberations of the Committee, Ministry of Railways have emphasised the functional requirements of the Organisation and the need for increasing the rates of this allowance for Loco Pilot (Passenger) and Loco Pilot (Mail /Express). Ministry of Railways have also stated that the nomenclature of the allowance used  by the 7th CPC may be changed as there are other running allowances admissible in Railways. The Committee noted that the rates of this allowance being fixed in nature, have already been revised by a factor of 2.25. In addition, Loco Pilot (Passenger) and Loco Pilot (Mail / Express) are already getting this allowance at different rates. Therefore, no change is being recommended in the rates for this Allowance. The Committee, however, recommends that the  name of this Allowance may continue to be „Additional Allowance‟ instead of Special Running Staff Allowance.

7th CPC Over Time Allowance To Operational Staff

Over Time Allowance (OTA) to Operational Staff – seeking Inputs/Comments

“Definition of Operational Staff : “All non-ministerial non-gazetted staff directly involved in smooth operation of the office including those tasked with operation of some electrical or mechanical equipment.”

No.A-27016/01/2017-Estt.(AL)

Government of India

Ministry of Personnel, Public Grievances and Pensions

Department of Personnel & Training

Block-IV, Old JNU Campus,

New Delhi – 110067,

Dated: 16th November, 2017.

Office Memorandum

Subject: Inviting comments on the definition of “Operational Staff” which would be eligible for Overtime Allowance

As per the Dept. of Expenditure’s Resolution No. 11-1/2016-IC dated 06.07.2017, following is the decision of Government on Overtime Allowance (OTA): “Ministries/Departments to prepare a list of those staff coming under the category of ‘Operational Staff’. Rates of Overtime Allowance not be revised upwards”. Further it has been clarified by the Dept. of Expenditure that the Government has decided that given the rise in the pay over the years, the recommendations of the 7th CPC to discontinue OTA for categories other than Operational Staff and industrial employees who are governed by statutory provisions may be accepted.

2. Accordingly, it has been decided to implement the aforesaid decision of the Government on Overtime Allowance across all the Ministries/Departments and attached and subordinate office of the Government of India.

3. However, this Department has been receiving queries from various Deptts. as to which staff would be covered under the term “Operational”. Thus it appears that there is a lack of clarity as to what constitutes Operational Staff. In pursuance of decision taken on the recommendations of the 7th CPC relating to OTA, a broad definition has been attempted in order to assist in identification of operational Staff. Definition: “All non-ministerial non-gazetted staff directly involved in smooth operation of the office including those tasked with operation of some electrical or mechanical equipment.”

4. Inputs and suggestions are requested from all Ministries/Departments taking into account the specific peculiar requirements of staff under each of them keeping in view the content of work being performed by them. The inputs /suggestions may be kindly sent to the undersigned on mail id: sandeep.saxena@nic.inwithin 15 days of the issue of this O.M.

sd/-

(Sandeep Saxena) 

Under Secretary to the Government of India

Authority: www.dopt.gov.in

NFIR - 7th CPC Constant Attendent Allowance

7th CPC Constant Attendant Allowance – Railway Board Orders

GOVERNMENT OF INIDA (BHARAT SARKAR)

MINISTRY OF RAILWAYS (RAIL MANTRALAYA)

(RAILWAY BOARD)

No.F(E)III/2009/PN1/6

RBE No.:164/2017

New Delhi,Dated: 08.11.2017

The GMs/The principal Financial Advisers
All Zonal Railways/Production Units
(As per mailing list)

Subject: Implementation of Government’s decision on the recommendations of the 7th Pay Commission on CCS (Extraordinary Pension) Rules, 1939 – Constant Attendant Allowance – regarding.

A Copy of Department of pension and Pensioners welfare (DOP&PW)’s O.M.No.1/4/2017-P&PW(F) dated 3rd October,2017 on the above cited subject is enclosed for information and compliance. These instructions shall apply mutatis mutandis on Railways also. CCS (Extraordinary Pension) Rules,1939 corresponds to Railway services (Extraordinary Pension) Rules, 1993. DOP&PW’s O.M.No.1/4/2017-P&PW(F) dated 02.08.2017, referred to in the enclosed O.M.dated 03.10.2017, was circulated on the Railways vide Board’s letter of even number dated 22.08.2017.

sd/-

(G.Priya Sudarsani)

Joint Director, Finance (Estt.)

Railway Board.

Source: NFIR

DOP - 7th CPC Children Education Allowance

7th CPC – Grant of Children Education Allowance – DEPARTMENT OF POSTS

7th CPC Implementation of decision relating to the grant of Children Education Allowance

F.No.33-03/2017-PAP

GOVERNMENT OF INDIA

MINISTRY OF COMMUNICATION

DEPARTMENT OF POSTS

(ESTABLISHMENT DIVISION)/PAP SECTION

DAK BHAWAN, SANSAD MARG,

NEW DELHI – 110 001

8th Nov. 2017

To

ALL HEADS OF CIRCLES,
ALL GM (PAF)/DAS (P),
ALL DIRECTORS POSTAL STAFF COLLEGE INDIA/PTCs.

Sub: Recommendations of the Seventh Central Pay Commission – Implementation of decision relating to the grant of Children Education Allowance.

I am directed to forward herewith a copy of extracts of the Ministry of Personnel, Public Grievances and Pensions, Department of Person6e1 & Training’s Office Memorandum No.27012/02/2017-Estt.(AL) dated 31.10.2017 on the subject cited above for kind information and further necessary action in this regard.

Encl: As above.

S/d,

(Narender Prakash)

Section Officer (PAP)

Order Copy

Railway Board - 7th CPC Additional HRA For Railway Employees

7th CPC-Additional HRA for Railway Employees

Implementation of the recommendations of 7th Central Pay Commission-Additional House Rent Allowance (HRA) for Railway Employees serving in the states of North Eastern Region, Andaman & Nicobar Islands, Lakshadweep Islands and Ladakh

GOVERNMENT OF INDIA

MINISTRY OF RAILWAYS

(RAILWAY BOARD)

RBE No.165/2017

New Delhi, dated 08.11.2017

S.No.PC-VII/75

No.E(P&A)II-2017/HRA-9

The General Managers/CAOs,

All Indian Railways & Production Units.

Sub:-Implementation of the recommendations of 7th Central Pay Commission-Additional House Rent Allowance (HRA) for Railway Employees serving in the states of North Eastern Region, Andaman & Nicobar Islands, Lakshadweep Islands and Ladakh.

Consequent upon revision of the rates of House Rent Allowance (HRA) granted to the Railway employees on implementation of the recommendations of 7th Central Pay Commission vide Board’s letter No.E(P&A)II-2017/HRA-7, dated 19-07-2017 (RBE No.71/2017), in modification of Board’s letter No.E(P&A)II/83/HRA-29, dated 30.06.1984 and Board’s letter No.E(P&A)II-2008/HRA-14, dated 25.02.2009 (RBE No.41/2009) on the subject mentioned above, additional HRA shall be granted to the Railway employees posted to states of North Eastern Region, Andaman & Nicobar Islands, Lakshadweep Islands and Ladakh, who leave their families behind at their old duty station at revised rates as per Board’s letter No. E(P&A)II-2017/HRA-7, dated 19-07-2017.

2.These orders will not be applicable to such employees who were transferred out of North Eastern Region, Andaman & Nicobar Islands and Lakshadweep Islands and Ladakh before 01.07.2017.

3.These orders shall take effect from 1st July, 2017.

4.This issues with the concurrence of the Finance Directorate of the Ministry of Railways.

s/d,

(Salim Md. Ahmed)

Dy.Director/E(P&A)-II

Railway Board.

Source: NFIR

Railway Board - 7th CPC Pay Element Relation To Running Staff/ Logo Inspectors

7th CPC-Pay element relating to Running Staff/Loco Inspectors

Pay element relating to Running Staff/Loco Inspectors after the recommendations of 7th CPC

GOVERNMENT OF INDIA

MINISTRY OF RAILWAYS

(RAILWAY BOARD)

No.E(P&A)II-2015/RS-25

New Delhi,

dated:13.11.2017

The General Manager,

Metro Railway,

Kolkata.

Sub : Pay element relating to Running Staff/Loco Inspectors after the recommendations of Seventh CPC.

Please refer to your letter no. MRTS/E.345/0/12/Pt.IV/Misc dt. 05.05.2017 requesting a clarification about the percentage of pay element to be reckoned for the purpose of computation of pensionary benefits in respect of Loco Inspectors. This issue has also been raised by GS/NFIR in his letter no. IV/RSAC/Conf/Pt. VIII dt. 15.09.2017.

2. Loco Inspectors are entitled to 30% add-on pay element for retirement benefits as per paragraph no. 5.5 of Board’s letter no. E(P&A)II/83/RS-10(iv) dt. 25.11.1992 which has not been amended as yet. It is clarified that the pay element (presently 30% until further orders) has to be reckoned in the revised pay structure of Seventh CPC for calculation of pensionary benefits of Loco Inspectors.

3. In this connection it is noted that many retired Loco Inspectors, even after getting the benefit of 30% add-on pay element at the time of pay fixation as Loco Inspectors, have gone to Courts of Law claiming 55% pay element for pensionary benefits equating themselves to the running staff. It is reiterated that Loco Inspectors are not classified as running staff and therefore are not entitled to 55% pay element for pensionary benefits. This fact may be conveyed to such Loco Inspectors while calculating their pensionary benefits.

4.This issues with the concurrence of the Finance Directorate of the Ministry of Railways.

s/d,

(Salim Md. Ahmed)

Deputy Director/E(P&A)II,

Railway Board

Source: NFIR

Comprehensive Training Programme For All Railway Employees

Railway Minister gives directions for “comprehensive training programme” for all employees

Press Information Bureau

Government of India

Ministry of Railways

14-November, 2017

Railway Minister gives directions for “comprehensive training programme” for all employees of Indian Railways to boost productivity & efficiency.

This comprehensive training programme is being launched under the name “Project Saksham”.

The week-long training in skills and domain knowledge will be imparted to all the employees of Indian Railways.

The focus of all such training is to ‘make a difference’ to the job performance.

Under the direction of Minister of Railways & Coal, Shri Piyush Goyal, a comprehensive plan for imparting training to all employees of Indian Railways is being prepared with a view to upgrade skill & knowledge. This comprehensive training programme named as “Project Saksham” will help boost productivity and efficiency.

Under this plan, all employees in each zone will be put through a week’s training in skills and knowledge relevant to their work area over next one year. A communication to this effect from Chairman Railway Board, Shri Ashwani Lohani, has been sent to all General Managers of zonal railways and railways production unit.

General Managers have been advised that such priority training need should be quickly identified for each category of employees (employees can be grouped into their work areas) based on the needs of respective zone. Identification of training needs and formulation of planned training calendar will be required to be completed by December 31st, 2017, ensuring that each employee is imparted training.

It has been emphasized that while continuous learning and education/training has been an integral philosophy and approach of the Railways, there is a need to do a concentrated capsule of training for all employees in a short period of time to boost their productivity and efficiency. This training programme will fulfill this need.

With growing rail network, new trains, different high quality services designed by the railways and the promise of the government to deliver superior and safe rail services and growing expectation of our passengers and commuters for better amenities and services, it is imperative that the railway employees rise to the occasion to deliver on the promise. Employees can and do deliver only when they have the right skills, knowledge and the mindset to deliver to the new standards of excellence that the organization hold from them all. This training will help achieve these objectives.

This training shall be a five-day on the job training or as classroom training in Railway Training Centre depending on the nature of training. However, the reporting managers of all employees receiving training need to be actively involved in the Pre-training and post training process to ensure that the benefits of training get reflected on the job performance and there is improvement within a short time after the training is imparted. The focus of all such training has to be to ‘make a difference’ to the job performance of all departments and employees and thus Indian Railways.

The training, as per the calendar, must be completed within 9 months. You may personally monitor the completion of the plans and their progress. The zone must also devise a few metrics to monitor the impact of Project Saksham.

This training will not only upgrade skill of each of the employees but also go a long-way in improving the performance of the Indian Railways.

PIB

7th CPC - Special Duty Allowance In The Committee Report

7th Pay Commission | Report of Committee| Special Duty Allowance 

Existing Provisions: It is granted to attract civilian employees to seek posting in North Eastern and Ladakh regions, in view of the risk and hardship prevailing in these areas. At present, SDA is paid @12.5% to Central Government Employees including officers of the All India Services, serving in the North Eastern Region states (including Sikkim) and Union Territories of A&N and Lakshadweep group of Islands & Ladakh. In addition, „Special Allowance for Officers belonging to North – East Cadres of AIS‟ is granted to AIS Officers belonging to the North East Cadres and posted in the North Eastern states at 25%.

Recommendations of 7th CPC: The 7th CPC has recommended that SDA for AIS officers should be paid at the rate of 30 percent of Basic Pay and for other civilian employees at the rate of 10 percent of Basic Pay.

Demands:

I. President Secretariat: SDA@30% be granted to employees of NEHU, Shillong.

II. Secretary, All Ladakh Central Government Employees Association through Minister, Social Justice & Empowerment, Governor‟s Secretariat, J&K, Shri Ghulam Nabi Azad, MP and Shri Thupstan Chhewang, MP:SDA@25% be granted to employees posted in Ladakh region in addition to Special Compensatory (Remote

Locality) Allowance.

III. Chief Minister, Manipur: SDA be allowed to continue and quantum be increased for officers posted in theNE.

IV. Ministry of Home Affairs: SDA admissible to AIS Service officers may be kept separate.

V. National Council (Staff Side), JCM: The SDA and Special Compensatory Allowance (SCA) are being paid concurrently. However, 7th CPC has recommended that both SDA and SCA should not be granted concurrently. Therefore, following changes have been demanded:

7th CPC recommendations to the effect that where Tough Area Compensatory Allowance is given, the SDA must be withdrawn, should be rejected.

Reduction in the present rate of SDA of 12.5% should not be accepted.

Discrimination in the grant of SDA between officers of AIS and other employees must be removed and all to be paid SDA at the same rate.

VI. Ministry of Defence: SDA to the Defence Forces at the same rate as applicable to civilian non-AIS employees is to be given. The admissibility of the allowance would be subject to a scheme to be worked out by Ministry of Defence in consultation with Ministry of Finance.

VII. J&K IAS Officers Association:

(i) SDA@12.5% of Basic Pay be granted to the regions of Jammu Province and Kashmir Valley

(ii) Additional Monetary Incentive @25% as payable to Officers belonging to NE Cadres of AIS be allowed.

Analysis and Recommendations of the Committee:

It is observed that the existing provisions relating to SDA at present paid @12.5% to Central Government Employees including officers of the All India Services, serving in the North Eastern Region states (including Sikkim) and Union Territories of A&N and Lakshadweep group of Islands & Ladakh and „Special Allowance for Officers belonging to North – East Cadres of AIS‟ granted @25% as per DoPT‟s OM dated 10th February, 2009 have inadvertently been presented by merging them together in the 7th CPC Report. However, both these allowances are governed differently and SDA @ 12.5% is paid to all officers irrespective of their service but „Special Allowance for Officers belonging to North – East Cadres of AIS‟ is granted @25% to AIS officers of NE Cadre serving in the Cadre.

The Committee, therefore, recommends that the two allowances, SDA and „Special Allowance for Officers belonging to North – East Cadres of AIS‟, may continue to be paid separately as at present at the rate of 10% and 20% respectively after applying the multiplying factor of 0.8 for percentage-based allowances.

As regards the demand of the Ministry of Defence, the Committee is of the view that the facilities available to Defence Forces differ significantly from those available to Civilian employees. Moreover, the demand pertains to including a new category in the existing allowance, which does not come under the purview of the Committee.

Demands relating to NEHU, addition of more categories or enhancement of rates and demands of J&K Officers‟ Association are also outside the purview of this Committee