IT Summary – Part 1
In this section, we will explore how to view the computed income tax results in a tabulated format using the IT Summary option. The IT Summary serves as the final output stage of income tax computation, where you can cross-check the accuracy of calculations, confirm whether all deductions and exemptions have been applied correctly, and ensure compliance before finalizing.
Navigate to TDS Details and click on IT Summary option.
This will direct you to a screen that displays the results of the income tax computation for employees for the selected financial year. The Financial Year can be chosen using the drop-down menu. The Quick Search option allows you to search for a particular employee by name or ID. Use the Filter option to refine the employee list as per your requirement.
Click the To Excel button to export the details to MS Excel and Close to exit the view IT summary screen.
Let us now learn each of the sections in detail :
- VI A deduction:
The VI-A Deduction captures the tax-saving investments and eligible expenses made by employees that fall under Chapter VI-A of the Income Tax Act, 1961.
This option helps in recording amounts under different sections like 80C, 80CCC, 80CCD, 80D, 80G, etc., and then automatically applies the exemption limits allowed by law. The deduction values entered here are subtracted from the employee’s gross total income to arrive at their taxable income, thereby reducing their tax liability.
- Perquisties:
The Perquisites option displays the details of additional benefits given by the employer to employees apart from salary and allowances. This option allows you to record the total value of such perks, identify if any part of it has been recovered from the employee, apply exemptions as per Income Tax rules, and finally calculate the taxable portion that will be added to salary income for tax computation.
- Others:
The Others option in IT Summary is used to capture any additional income or benefit received by the employee which does not strictly fall under salary, allowances, or perquisites.
These incomes are still taxable under the head income from salary or other sources depending on their nature.
- Allowance:
The Allowances option records different allowances paid to employees, checks if they are eligible for tax exemption (like HRA, LTA, etc.), and then divides them into exempt and taxable portions. If exemption conditions are not met (like rent not provided for HRA), the entire allowance is treated as taxable.
- Main Components:
The Main Components option refers to the primary parts of an employee’s salary structure that form the basis of their total income. These are the fixed and major elements of salary on which allowances, deductions, and other components are built.
With this, the explanation of the IT summary Part-1 comes to an end.
