ITR 2 Salary Break-up for AY 2024-25

Tips to Fill Salary Details in ITR 2

In ITR2 one needs to fill Schedule (or section) S, Income from Salary:

1. How to Fill in Schedule S of Income Tax Return ITR 2

1. Salary (Excluding all exempt/non-exempt allowances, perquisites & profit in lieu of salary ) in Schedule S a from (a) of Gross Salary in Form 16 – Professional Tax – HRA – Allowance to the extent exempt u/s 10
2. Allowances exempt under Section 10 : Total of all the allowances exempt(ex: House Rent Allowance, Transport Allowance,) from Total of (2) Less: Allowance to the extent exempt u/s 10 This consists of Allowances shown in Form 16 + HRA calculated
3. Value of Perquisites in Schedule S a from (c) (b) Value of perquisites under section 17(2) 21600.00 (as per Form 12BA,wherever applicable) in Form 16.
4. Profits in Lieu of Salary in Schedule S a from (c) Profits in lieu of salary under section 17(3) 0.00 (as per Form No: 12BA,wherever applicable) 5(in color maroon) in Form 16.

2. How to Fill Schedule S in ITR2 When HRA Has Been Claimed

The individual needs to keep their Form 16 ready for reference for filling in Salary Details:
Check whether your Salary includes Professional Tax in it:
This is listed on your Form 16 Tax on Employment as well as on your payroll receipt. This generally runs to a flat amount of Rs. 2,400 for each year for most professionals. Most Indian states levy this tax, but make sure that it applies to the state the individual belongs to or not.

• Salary (Excluding all exempt/non-exempt allowances,perquisites & profit in lieu of salary ) in Schedule S a from (a) of Gross Salary in Form 16 – Professional Tax – Allowance to the extent exempt u/s 10
• Allowances exempt under section 10 :Total of all the allowance exempt(ex: House Rent Allowance, Transport Allowance,) from Total of (2) Less : Allowance to the extent exempt u/s 10
• Value of Perquisites in Schedule S a from (c) (b) Value of perquisites under section 17(2) 21600.00 (as per Form No:12BA,wherever applicable) in Form 16.
• Profits in Lieu of Salary in Schedule S a from (c) Profits in lieu of salary under section 17(3) 0.00 (as per Form No: 12BA,wherever applicable) 5(in color maroon) in Form 16.

3. Tips To Fill Schedule S in ITR 2 when HRA Has Not Been Claimed

In case the individual’s HRA has not been mentioned and yet you are eligible then the person needs to calculate HRA using the formula under section 10 mentioned in Form 16. For instance, if your LTA is Rs. 50,000 and therefore the HRA that computes to Rs. 1 lakh then the Allowances that would be exempted under the section of the Income Tax Act would be Rs 1.5 lakhs.

The least of the mentioned below should be ideally claims as the House rent allowance:

1. 50% / 40%(metro / non-metro) of basic salary
2. Rent paid minus 10% of salary.
3. Actual HRA received

Documents Required for Filing ITR 1 and ITR 2

When filing your income tax return (ITR-1 or ITR-2), it's essential to gather the necessary documents to ensure a smooth and hassle-free process. Here are the documents required for salaried employees:

1. PAN Card: Your permanent account number. 
2. Form 16: This document is issued by your employer and provides details of your salary, tax deducted, and other allowances. 
3. Bank TDS Certificate: It serves as proof of tax deducted at source (TDS) by banks. 
4. Form 26AS: This form is provided by the Income Tax Department and can be downloaded from their official website. It summarizes the income tax paid by you during the financial year, including details of taxes deducted at source from your income. 
5. Documents for claiming deductions: Keep handy the relevant documents for claiming deductions under Section 80. These may include receipts or proof of contributions to the Provident Fund, tuition fees paid for your children's education, payments towards life insurance premiums, registration and stamp-duty charges, and home loan payments. 
6. Interest Income Documents: You need to provide your bank statement or passbook that shows the interest earned in your savings account. Additionally, you should have statements for the interest received on fixed deposits.  
7. Documents related to investments made under Section 80: You should have documents that prove your investments are eligible for deductions under Section 80. These may include documents related to investments in Public Provident Fund (PPF), Equity-Linked Saving Scheme (ELSS), and LIC premium certificates, among others.
8. Other Documents: If applicable, you will need documents pertaining to interest paid on a home loan, interest paid on education loans, and records of stock trades for calculating capital gains.

Filing income tax returns is a crucial responsibility for individuals, as it is both mandatory by law and a duty to contribute to the country's progress. However, many people lack awareness about the process. This article aims to help those who struggle with filing salary details in ITR 1 and ITR 2. To file your returns accurately, it is important to determine the appropriate form based on your income type, annual income, and eligible exemptions. Understanding the correct form will save time and effort while ensuring compliance.

Understanding  of ITR 2