EaseValueSalary income is taxed under Chapter IV-B (sections 15 to 19) of the Income-tax Act, 2025, which takes effect from 1 April 2026. In simple terms, your gross salary — pay, allowances, perquisites and profits in lieu of salary — is added up, and then the deductions allowed by section 19 (chiefly the standard deduction and professional tax) are subtracted to arrive at your income chargeable under the head “Salaries”.
The five building blocks are:
- Section 15 — what salary is chargeable to tax (due basis, receipt basis, arrears).
- Section 16 — what the word “salary” includes (wages, pension, gratuity, perquisites, leave encashment, employer NPS contribution and more).
- Section 17 — perquisites (rent-free accommodation, ESOPs/sweat equity, employer-paid obligations, etc.).
- Section 18 — profits in lieu of salary (compensation on termination, joining/severance payments, certain fund payments).
- Section 19 — the deductions allowed, including the standard deduction of ₹75,000 under the new regime and gratuity exemptions.
Use the calculator below to estimate your HRA exemption, then open each section for a plain-language explanation with examples.