How to Add Salary Allowances Exempt Under Section 10 on myITreturn?

Salary received from an employer may include allowances such as House Rent Allowance, Leave Travel Allowance, conveyance allowance, daily allowance and other employment-related allowances.

Some allowances may be wholly or partly exempt from tax under section 10, subject to the tax regime selected and the conditions prescribed under the Income-tax Act and Rules.

While entering salary details on myITreturn, the exempt portion of these allowances must be reported under “Allowances Exempt Under Section 10.”

Check the Tax Regime Selected

The exemptions available against salary allowances depend on whether the old tax regime or the new tax regime has been selected.

Old Tax Regime

Subject to the applicable conditions, exemptions that may be available under the old tax regime include:

• Leave Travel Concession or Assistance under section 10(5)
• House Rent Allowance under section 10(13A)
• Official-duty allowances under section 10(14)(i)
• Specified personal or compensatory allowances under section 10(14)(ii)
• Other eligible salary exemptions listed in the return

New Tax Regime

The new tax regime is the default regime for AY 2026-27. Under this regime, exemptions such as HRA and Leave Travel Allowance are generally not available.

However, the return contains separate categories for the limited allowances that remain eligible under the new tax regime, including:

• Allowance for travel on tour or transfer
• Daily allowance for absence from the normal place of duty
• Conveyance allowance for performing official duties, where free conveyance is not provided
• Transport allowance for an eligible employee with a specified disability

Details to Keep Ready

Before entering the allowance details, keep the following documents and information available:

• Form 16 issued by the employer, particularly Part B
• Salary slips or salary breakup
• Rent receipts and landlord details for an HRA claim
• Travel tickets or supporting documents for Leave Travel Allowance
• Records of expenses incurred for performing official duties
• A valid disability certificate, where applicable

Steps to Add Salary Allowances Under Section 10

Step 1: Log in and Select the Member

Log in to myITreturn.com and select the member whose Income-tax Return is being prepared.

Step 2: Open the Salary or Pension Section

From the top menu, go to:

Income → Salary/Pension

Open the relevant employer entry. Where the employer has not already been added, enter the employer and organisation details first.
 

Step 3: Enter the Salary Details

Enter the salary figures as reported in Form 16 Part B, including:

• Salary under section 17(1)
• Value of perquisites under section 17(2)
• Profits in lieu of salary under section 17(3)
• Standard deduction, as applicable
• Tax deducted at source by the employer

Locate the field titled “Allowances Exempt Under Section 10.”

Step 4: Enter the Total Exempt Allowance

Enter the total amount of allowances eligible for exemption under section 10. The amount can generally be found against Point 2 of Form 16 Part B.

For example, where Form 16 reports exempt allowances of ₹1,56,200, enter ₹1,56,200 in the Allowances Exempt Under Section 10 field.

Step 5: Open the Exempt-Allowance Breakup

Open the page titled “Details of Exempt Allowances under Salary.”

This page displays:

• The employer’s name
• The total exempt allowance entered earlier
• A dropdown for selecting the allowance category
• An amount field
• An ADD button

Step 6: Select the Correct Allowance Category

Click the allowance dropdown and select the category that corresponds to the allowance reported in Form 16.

Depending on the nature of the allowance, the available options may include:

• Gratuity received
• Commuted pension
• Leave encashment
• Retrenchment compensation
• Compensation received on voluntary retirement
• Conveyance allowance for official duties
• Travel allowance for tour or transfer
• Daily allowance for absence from the regular place of duty
• Transport allowance for an eligible person with disability
• Other exemptions listed in the dropdown

Step 7: Enter the Exempt Amount and Click ADD

Enter the exempt amount applicable to the selected category and click ADD.

Where the total exemption contains more than one allowance, repeat the process separately for each allowance.

For example:

The example assumes that the old tax regime has been selected and that all applicable exemption conditions have been satisfied.

Step 8: Reconcile the Total Amount

Confirm that the total of all category-wise entries matches the amount shown against Exempt Allowances U/s 10.

A mismatch between the total allowance and the category-wise breakup may result in an incomplete salary schedule or a return-validation error.

Common Mistakes to Avoid

Entering the Entire Allowance Received

Enter only the eligible exempt portion. Any taxable portion of an allowance must remain included in salary income.

Selecting an Incorrect Dropdown Category

Select the category that correctly describes the exemption. Do not select an unrelated option merely because the amount is correct.

Claiming an Exemption Under the Wrong Tax Regime

HRA, LTA and several other exemptions are not available under the new tax regime. Verify the tax regime before entering the allowance.

The Breakup Does Not Match the Total

The combined category-wise exemption must match the total amount entered in the Salary or Pension section.

Adding a Zero-Value Entry

Correct the selected category and enter the applicable amount before clicking ADD. Do not retain an unnecessary zero-value entry.

Claiming the Same Allowance More Than Once

Ensure that an allowance already reported under one category is not entered again under another category.

Which Income-tax Act Applies?

Under the Income-tax Act, 2025, the corresponding salary-exemption provisions are primarily contained in section 11 read with Schedule III. The new tax regime is contained in section 202.

Final Check Before Filing

Before proceeding to the Summary or e-File section, confirm that:

• The correct tax regime has been selected
• The total exempt allowance agrees with Form 16
• Each allowance has been entered under the correct category
• The category-wise breakup matches the total exemption
• The exemption does not exceed the applicable legal limit
• The allowance has not been entered twice
• Supporting documents are available

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