Gratuity received under Payment of Gratuity Act 1972

Gratuity is one of the benefits provided by the employers. If the received gratuity is under the Payment of Gratuity Act 1972, then the employee can claim a part of the amount whichever is least among the following cases.

- 10 Lakh

- 15 days salary based on salary last drawn for each year of service

- Actual Gratuity received by you.

Foreign Allowance

When the employee is abroad and is paid by the Government of India, then this is known as foreign allowance for rending their services in a foreign country. This amount is tax exempted.

Children Education Allowance

A maximum of 100 can be paid as Children education allowance per month per child and for 2 children only. This entire amount is totally non taxable.

Some more allowances which are entirely taxable are city compensatory allowance, fixed medical allowance, project allowance, and Tiffin allowance.