on 04-05-2017 1:21 PM
Dear Experts,
I will need to use NPS ER contribution % in IT587 with effect from 01.04.2017. I just tried putting this for one employee and INTAX has generated below wage types.
/3FS Er NPS Contrib Amount -
/3FT Annual NPS Contrib Amount
/3I6 Sec80CCD Er deduction
I will have to show this as Salary component in IT8. My doubt is how does the exemption happens for ER contribution. For EE contribution, upto 50K is taken as exemption and is added to Chapter VI deductions. However, when I used ER contribution, I am seeing more than one lakh is being taken for exemption under Chapter VI.
Please let me know your thoughts.
Best Regards
Lalitha K R
Hi Lalitha K R,
Er contribution does not effect the gross amount of the employee he takes the same salary home but the taxable income of the employee is increased. Ex : basic pay 10,000 *10%(percentage setup in in IT587) = 1000*12 = Rs12,000
Make entries In IT585 under the head - Contribution to pension scheme of Central Government - Rs. 50000
then when you process salary and print form 16
You will see then exemption under chapter VI-A part (B) under 80 CCD(1B)(01) Rs. 50000
I hope i have helped
Regards
Ankush Panwar
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