If you have received any portion of your salary / pension / family pension received in arrears, you can avail tax relief u/s 89(1) of Income tax Act ,1961
This calculator calculates your tax liability for the Financial Year 2015-16 (AY 2016-17) and also at one place you can calculate / recalculate your tax liability for the previous FY 2012-13, FY 2013-14, FY 2014-15 to calculate your Tax Relief U/S 89(1)
Any one who have received arrears of salary / allowances / pension in the Financial Year FY 2015-16 / FY 2014-15 and likes to avail tax relief u/s 89(1) (i.e. treating the amount of arrears for taxability to the period of previous financial years it pertains ) can calculate revised tax liability for the financial year 2012-13 to 2015-16.
The bankers in FY 2015-16 have got arrears on salary revision w.e.f. Nov '2012 (i.e. amount received on salary revision pertains to FY 2012-13, FY 2013-14, FY 2014-15 & FY 2015-16) they are eligible to avail tax relief u/s 89(1). First you have to recalculate your tax liability of the respective previous years by bifurcation of arrear and adding to income pertaining to the respective years and assess your tax liability whether it is less in comparison with treating the gross arrear as income in the yeas it is received i.e in FY 2015-16.
This calculator helps you to evaluate your tax outgo by bifurcation of arrears in FY 12-13 to FY 15-16 by entering your requisite details of income / rebates / tax paid for the respective years and also calculating tax liability by tentative gross income of the year FY 15-16. At last of the calculator you will find the impact on your tax liability - in case it comes in positive - means that to avail tax relief U/S 89 (1) is beneficial to you and in case it is in negative - it will be better for you to report gross arrear as income in the year it is received.
To claim tax relief U/S 89(1) the employee is required to submit his/her details in form 10(E). Click Here to Download one page Form 10E for claiming relief U/S 89(1) of Income tax Act ,1961.