Commuted pension tax treatment: part exempt, part taxable; exemption reduced where gratuity is received. Uncommuted pension is fully taxable as salary; commuted pension is partly exempt and partly taxable. Compute a notional full pension value from the commuted payment and apply an exemption fraction: if no gratuity is received, one half of the notional full pension value is exempt; if gratuity is received, one third is exempt. The remainder of the commuted payment is chargeable to tax as salary and must be added to taxable uncommuted pension to determine total taxable pension income.
Gratuity exemption: least of three test determines exempt portion for noncovered employers; excess gratuity is taxable. Gratuity from a noncovered employer is exempt to the extent of the least of three amounts: the service based fraction computed from the average monthly salary (which includes basic pay, one month's dearness allowance, and average monthly commission), the statutory monetary ceiling, and the gratuity actually received; any excess over that exempt amount is taxable.
Gratuity exemption: part determined by 15 days salary times completed years, excess treated as taxable salary. Gratuity exemption is determined by taking the least of: the product of 15 days' salary and completed years of service, the statutory ceiling, and the gratuity received. Completed years may be rounded to include qualifying months. The exempt portion is that least amount; any excess over the exempt amount is taxable as salary income in the assessment year.
Gratuity exemption under Section 10(10)(i) remains available even if retiree accepts private sector employment after retirement. Gratuity paid to a government employee on retirement is fully exempt from income tax under the governing gratuity exemption provision, and that exemption remains available even if the retiree subsequently accepts employment in the private sector.
Comparison of Section 201 "Tax on income of new manufacturing domestic companies." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)
4 September, 2025
Contents
Acts
Rules & Regulations
Summary
Note
Bookmark
Share
✓ Copied successfully !
Print
Print Options
For full text, please login
Login to TaxTMI
Verification Pending
The Email Id has not been verified. Click on the link we have sent on
Concessional tax regime for new manufacturing companies: elective, time limited option with fixed-rate treatments and strict eligibility. An elective concessional tax regime permits domestic manufacturing companies to compute tax under a standalone scheme with fixed tax treatments for ... Summary
Concessional tax regime for new manufacturing companies: elective, time limited option with fixed-rate treatments and strict eligibility.
An elective concessional tax regime permits domestic manufacturing companies to compute tax under a standalone scheme with fixed tax treatments for defined income categories and specified exclusions. Eligibility hinges on incorporation/registration and commencement temporal thresholds, timely exercise of the option which, once exercised, is irrevocable and continues for subsequent years. Failure to meet conditions invalidates the option prospectively. Computation is constrained by sub-section rules that exclude certain deductions and bar set-off of losses or unabsorbed depreciation attributable to excluded deductions, while cross-references determine treatment of capital gains and deemed incomes.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
TaxTMI 
of 34 
