Employer's Contribution towards Gratuity Fund - Section 36(1)(v) - Income Tax - Ready Reckoner - Income Tax

Employer's Contribution towards Gratuity Fund - Section 36(1)(v) Any sum paid by the employer by contributing towards approved gratuity fund for exclusive benefit of his employees shall be allowed as deduction. Following points should be consider : Ordinary contribution cannot exceed 8.33% of the salary of each employee. The amount to be allowed as a deduction on account of an initial contribution which an employer may make in respect of the past services of an employee admitted to the benefits of a fund cannot exceed 8.33% of the employee's salary for each year of his past service with the employer. Payment directly to LIC towards Group Gratuity Fund is deductible.