How Form 8854 Subsection 2023-2024

Hi guys, welcome back! In this video tutorial, we will cover how to calculate relief under section 89. There are cases when you receive a year of salary or bonus from your employer, and your tax liability in the current financial year increases. Salary, as you all know, is taxable on us, based on whichever is earlier. Sometimes, in the public sector or government departments, this amount or the area is received after two or three years. So, suddenly, in one financial year, you get a huge chunk of that amount and have to pay taxes on it. This is where the relief provision under section 89 comes into play. This provision is basically applicable for three types of income. If you read the Big Bear Act provision on your screen, you can see the section 89 under which it falls. This provision is applicable for salary, profit in lieu of salary, and family pension. Apart from these, if you are receiving any payment from anyone else, you can't avail of this relief under section 89. The last line states that due to this relief, your total income is assessed at a higher rate than it would have been otherwise. Your tax liability increases because of this additional income. Now, let's move on to how to calculate this relief. There are some rules prescribed in the Income Tax Rule for calculating relief under section 89. Based on these rules, there are seven steps to calculate relief under section 89. Let's go through these steps and then solve a practical example. Here's an example: there is a person named Unit who is a salaried employee. His particulars for calculation of relief are as follows: - Financial Year 2013-14: Basic salary and others - 10 lakh rupees - Financial Year 2012-13: Basic salary and others - 4 lakh...