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23. Deductions from gross salary.
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23. Deductions from gross salary.—(1) The deductions from the gross salary for computation of income from employment, to the extent included in the gross salary, shall be the following, namely :—
(a) any sum paid by the employee on account of a tax on employment within the meaning of clause (2) of article 276 of the Constitution ;
(b) any allowance or benefit granted by an employer for journey by an employee between his residence and office or any other place of work, to such extent as may be prescribed ;
(c) any allowance or benefit granted by an employer to an employee—
(i) to meet expenses wholly, necessarily and exclusively in the performance of the duties of an office or employment of profit, as may be prescribed, to the extent such expenses are actually incurred for that purpose ;
(ii) to meet personal expenses, considering the place of posting or nature of duties or place of residence, subject to such conditions and limits as may be prescribed ;
(d) any amount of contribution made by an employer, in the financial year, to the account of an employee under an approved pension fund notified by the Central Government, to the extent it does not exceed ten per cent. of the salary of the employee ;
(e) any amount of contribution made by an employer, in the financial year, to the account of an employee in an approved superannuation fund ;
(f) any amount of contribution by an employer, in the financial year, to an account of an employee in an approved provident fund, to the extent it does not exceed twelve per cent. of the salary of the employee ;
(g) any amount of interest credited, in the financial year, on the balance to the credit of an employee in an approved fund to the extent it does not exceed the amount of interest payable at the rate notified by the Central Government ;
(h) any allowance provided by an employer to meet the expenditure actually incurred on payment of rent in respect of residential accommodation occupied by the employee, to such extent as may be prescribed.
(2) For the purposes of clauses (d), (f) and (h) of sub-section (1), salary means basic salary and includes dearness allowance, if the terms of employment so provide.
Clause 23 provides that the deductions from the gross salary for computation of income from employment to the extent included in the gross salary shall be the following, namely :—
(a) any sum paid by the employee on account of a tax on employment within the meaning of clause (2) of article 276 of the Constitution ;
(b) any allowance or benefit granted by an employer for journey by an employee between his residence and office or any other place of work, to such extent as may be prescribed ;
(c) any allowance or benefit granted by an employer to an employee to meet expenses wholly, necessarily and exclusively in the performance of the duties of an office or employment of profit, as may be prescribed, to the extent such expenses are actually incurred for that purpose and to meet personal expenses, considering the place of posting or nature of duties or place of residence, subject to such conditions and limits as may be prescribed ;
(d) any amount of contribution made by an employer in the financial year to the account of an employee under an approved pension fund notified by the Central Government, to the extent it does not exceed ten per cent. of the salary of the employee ;
(e) any amount of contribution made by an employer in the financial year to the account of an employee in an approved superannuation fund ;
(f) any amount of contribution by an employer, in the financial year, to an account of an employee in an approved provident fund to the extent it does not exceed twelve per cent. of the salary of the employee ;
(g) any amount of interest credited, in the financial year, on the balance to the credit of an employee in an approved fund to the extent it does not exceed the amount of interest payable at the rate notified by the Central Government ;
(h) any allowance provided by an employer to meet the expenditure actually incurred on payment of rent in respect of residential accommodation occupied by the employee, to such extent as may be prescribed.
The said clause provides that for the purposes of (d), (f) and (h) above, salary means basic salary and includes dearness allowance, if the terms of employment so provide.
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