1. COMPENSATORY FIELD AREA ALLOWANCE

Tax Exemption:

1. Actual Compensatory Field Area Allowance OR

2. 2600 Rs. Per Month

   Which Ever is Less

Note:

Either of One Tax Benefit Can be Claim out of following:

• Border Area Allowance

• Compensatory Field Area Allowance

2. COMPENSATORY MODIFIED FIELD AREA ALLOWANCE

Tax Exemption:

1. Actual Allowance OR

   1. 1000 Rs. Per Month

   Which Ever is Less

Note:

Either of One Tax Benefit Can be Claim out of following:

• Border Area Allowance

• Compensatory Field Area Allowance

3. COUNTER INSURGENCY ALLOWANCE

PURPOSE:

When ARMY PERSON living Away from their Home for duty in specific areas.

Tax Exemption:

1. Actual Allowance OR

2. 3900 Rs. Per Month

   Which Ever is Less

4. HIGH ACTIVE FIELD AREA ALLOWANC

Tax Exemption:

1. Actual Allowance OR

   1. 4200 Rs. Per Month

      Which Ever is Less

5. ISLAND DUTY ALLOWANCE

PURPOSE:

When ARMY PERSON Posted in Andaman Nicobar island, Lakshadweep, Group of island.

Tax Exemption:

1. Actual Allowance OR

2. 3250 Rs. Per Month

   Which Ever is Less

6. TRIBAL AREA ALLOWANCE - SCHEDULED AREA ALLOWANCE - AGENCY AREA ALLOWANCES

PURPOSE:

When posting is done in any Tribal Areas or Schedule Areas. The tribal areas or Scheduled Areas for army personnel refer to regions designated under the 5^th Schedule of the Indian Constitution, Madhya Pradesh, Tamil Nadu, UP, Karnataka, Tripura, Assam, West Bengal, Bihar, Orissa etc.

Tax Exemption:

1. Actual Tribal Area Allowance OR

2. 200 Rs. Per Month

Which Ever is Less

7. BORDER AREA ALLOWANCE - Remote Locality Allowance - Disturbed Area Allowance - Difficult Area Allowance

Tax Exemptions are as following

FEW EXAMPLES OF PLACES

8. UNDERGROUND ALLOWANCE – for Working in Mines

Tax Exemption:

Altitude 9000 feet to 15000 feet

1. Actual Allowance OR

2. Rs. 1060 Per Month

Which Ever is Less

Altitude Above 15000 feet

1. Actual Allowance OR

   1. Rs. 1600 Per Month

Which Ever is Less

9. SPECIAL COMPENSATORY ALLOWANCES (Hilly Area)

High Altitude Allowance

Uncongenial Climate Allowance

Snowbound Area Allowance

Avalanche Allowance

Here’s a breakdown of Special Compensatory Allowances given to defence personnel under various name of Army Salary Allowances like High Altitude Allowance Uncongenial Climate Allowance , Snowbound area allowance etc for performing duties in high-risk or difficult areas—such as those in Jammu & Kashmir, Siachen, Sikkim, Manipur or other hilly regions— and their income tax exemptions are based on Area Specific which is as under :

10. FULLY TAX FREE ARMY ALLOWANCES

• Bhutan Compensatory Allowance (BCA)

• Myanmar Allowance

• Outfit Allowance on Posting to Embassy

• Special Winter Uniform Allowance

• Kit Maintenance Allowance

• Uniform Allowance

• Helper Allowance

• Conveyance Allowance

• Washing Allowance (CCA)

• All Kind of Reimbursements

11. FULLY TAXABLE DEFENCE ALLOWANCES

• Risk and Hardship Allowance

• Special Force Allowance

• Tunnel Allowance

• Night Duty Allowance

• Parachute Allowance

• Special Commando Allowance

• Para Allowance

• Dearness Allowance (DA)

• Deputation Allowance

• Military Service Allowance

• City Compensatory Allowance (CCA

• Project Allowance

• Overtime Allowance

• Fixed Medical Allowance

• Telephone Allowance

• Holiday Allowance

• Interim Allowance

12. HOUSE RENT ALLOWANCE ( HRA Exemption For Army Persons )

Tax Exemption:

1. Actual Allowance OR

   1. Rent Paid – 10% of Salary OR

   2. 40% of Salary (Non Metro City) 50% of Salary (Metro City)

Which Ever is Less

ONLINE HRA CALCULATOR – FOR TAX PLANNING

13. CHILDREN EDUCATION ALLOWANCES

Tax Exemptions

1. Actual Allowance OR

2. Rs. 100 pm – Per Child

(Which Ever is Less)

Note:

• CEA Allowed for Max 2 Children

• But it can be claimed for 3 children subject to that second time twins child born.

14. HOSTEL ALLOWANCE

Tax Exemptions

3. Actual Allowance OR

4. Rs. 300 pm – Per Child

(Which Ever is Less)

Note:

• CEA Allowed for Max 2 Children

• But it can be claimed for 3 children subject to that second time twins child born.

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