Question

What is the statutory limit u/s 16(ii) for deduction of entertainment allowance in case of government employee?

A Rs 5000 Correct Answer Incorrect Answer
B Rs 7500 Correct Answer Incorrect Answer
C Rs 10,000 Correct Answer Incorrect Answer
D 25% of employee's salary Correct Answer Incorrect Answer

Solution

As per section 16(ii), Government employees can claim a deduction for entertainment allowance by considering the lowest from the following: 20% of an individual’s basic salary Rs.5,000 Entertainment allowance amount received in the financial year This deduction is not available for individuals working in private firms or any statutory or local authorities.

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