Download |top| 89(1) Relief Calculator ● ❲Quick❳

When you receive past-due salary (arrears) in the current financial year, it is technically taxable in the year of receipt. This "bunching" of income often artificially inflates your total income, leading to higher tax liability. Section 89(1) allows you to recalculate your tax as if the income was received in the years it was actually due, potentially lowering your overall tax payable. Eligible Payments for Relief: Salary arrears or advance salary. Arrears of family pension. Gratuity (if service is 5+ years). Commuted value of pension. Compensation on termination of employment. Step-by-Step Calculation Guide

You can manually calculate your relief or use a downloadable to automate these steps: Section 89 of Income Tax Act - Relief in New Tax Regime download 89(1) relief calculator

Section 89(1) of the Income Tax Act provides essential relief to taxpayers who receive salary arrears or advance payments in a lump sum, which could otherwise push them into a higher tax bracket. To claim this benefit, filing on the Income Tax e-Filing Portal is mandatory. Understanding Section 89(1) Relief When you receive past-due salary (arrears) in the