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Question
In the industrial sector, the term 'gratuity' is treated as a __________ from the employer to his employees for the services rendered.
In the industrial sector, the term 'gratuity' is treated as a __________ from the employer to his employees for the services rendered.
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Solution
The correct option is C Gift
Gratuity is a benefit
given by the employer to employees. A recently approved amendment by the Centre
has increased the maximum limit of gratuity. Now it is tax exempt up to Rs 20 lakh from the previous
ceiling of Rs 10 lakh, which comes Section 10(10) of the Income Tax Act.
Therefore term gratuity is treated as ‘gift’.
Gratuity is a benefit given by the employer to employees. A recently approved amendment by the Centre has increased the maximum limit of gratuity. Now it is tax exempt up to Rs 20 lakh from the previous ceiling of Rs 10 lakh, which comes Section 10(10) of the Income Tax Act. Therefore term gratuity is treated as ‘gift’.
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