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Thread: Cea

  1. #1
    Member abhijitdas_rlikol is on a distinguished road
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    Default Cea

    Is Children Educaiton Allowance (maximum Rs. 12000/- each child upto 2 child) will be included in gross salary?

  2. #2
    Member venkatcustoms is on a distinguished road
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    Default CEA Taxability

    Quote Originally Posted by abhijitdas_rlikol View Post
    Is Children Educaiton Allowance (maximum Rs. 12000/- each child upto 2 child) will be included in gross salary?
    Yes, Children Education Allowance is taxable and shall be included in Gross Salary.

    However, the tuition fees spent in respect of children is admissible for deductions. (within the ceiling limit of Rs. 1 Lakh)

  3. #3
    Senior Member tvenkatam is on a distinguished road
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    Default

    Quote Originally Posted by abhijitdas_rlikol View Post
    Is Children Educaiton Allowance (maximum Rs. 12000/- each child upto 2 child) will be included in gross salary?
    Of course, Yes. CEA is taxable and will, no doubt, form a part of ‘salary income’. However, exemption from income tax is available under Section 10 (14) (ii) to a limited extent as under:
    CEA : Rs 100 per month per child up to 2 children;
    Hostel fees : Rs 300 per month per child up to 2 children

  4. #4
    Junior Member VKANIRUDH is on a distinguished road
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    Default Cea is taxable or not

    As per new circular dated 11.01.2010 of income tax children education allowance is not covered under the head salary and it covers in prequisite and that exempt upto rs.1000/- per child per month. All are requested to kindly clairfy that my view is right or wrong.

  5. #5
    Senior Member tvenkatam is on a distinguished road
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    Default

    Quote Originally Posted by VKANIRUDH View Post
    As per new circular dated 11.01.2010 of income tax children education allowance is not covered under the head salary and it covers in prequisite and that exempt upto rs.1000/- per child per month. All are requested to kindly clairfy that my view is right or wrong.
    Dear Friend,

    CEA will be treated as ‘perquisite’ only if it is directly incurred by the employer.

    When CEA is reimbursed to the employee after it is incurred by the employee, the amount so reimbursed will form a part of the ‘salary income’ of the employee.

    Exemption from payment of IT is available to CEA only to the extent mentioned at post #3 above. In addition, the tuition fees component of CEA will be eligible for rebate within the ceiling of Rupees one lakh admissible for savings.

  6. #6
    Junior Member gtresures is on a distinguished road
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    Quote Originally Posted by tvenkatam View Post
    Dear Friend,

    CEA will be treated as ‘perquisite’ only if it is directly incurred by the employer.

    When CEA is reimbursed to the employee after it is incurred by the employee, the amount so reimbursed will form a part of the ‘salary income’ of the employee.

    Exemption from payment of IT is available to CEA only to the extent mentioned at post #3 above. In addition, the tuition fees component of CEA will be eligible for rebate within the ceiling of Rupees one lakh admissible for savings.
    Absolutely correct. Some employees without CEA reimbursement also claim CEA rebate which is not correct. It is an exemption of income (reimbursement) and not a deduction. i.e. 100 * 12 = 1200 per child, max 2 child. And VVN (Vidyalaya vikas nidhi of KV) cannot be taken as tuition fee for deduction under 80C. because it is development fund

  7. #7
    Junior Member gtresures is on a distinguished road
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    Quote Originally Posted by VKANIRUDH View Post
    As per new circular dated 11.01.2010 of income tax children education allowance is not covered under the head salary and it covers in prequisite and that exempt upto rs.1000/- per child per month. All are requested to kindly clairfy that my view is right or wrong.
    CEA : Rs 100 per month per child up to 2 children;
    Hostel fees : Rs 300 per month per child up to 2 children.

    Eg. You claim rs.15000 as reimbursement, it is a taxable income and Rs.1200 is exemted in that. So Rs.13800 net is taxable

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