Tax-free gratuity up to ₹20 lakh

 

 

Employees are set to gain from the doubling of tax-free gratuity limits by the government. The Payment of Gratuity (Amendment) Bill, 2017 was passed for the benefit of private and public sector employees. With this amendment Bill, the ceiling of tax-free gratuity is now increased to ₹20 lakh from the earlier limit of ₹10 lakh.

This limit of ₹20 lakh can be increased by the government as and when the need arises, by passing an executive order. The amendment benefits employees working in factories, mines, oil fields, plantations, ports, railways and companies. Employees can get gratuity benefit if they work in any organisation for more than five years. The Gratuity Act applies to establishments employing 10 or more persons.

In another development, the Maternity Benefit (Amendment) Act, 2017 extended the maternity leave to up to 26 weeks from the earlier 12 weeks. Maternity leave will be considered as continuation of service for the purpose of calculation of amount of gratuity.

IRDAI extends deadline

The Insurance Regulatory and Development Authority of India (IRDAI) has extended the deadline for linking insurance policies with Aadhaar. This decision was made after the Supreme Court extended the deadline for linking Aadhaar with various schemes without mentioning any date. IRDAI has given relief to the existing insurance policies by extending the deadline till the judgment of the Supreme Court. The deadline for linking Aadhaar with insurance policies was earlier March 31, 2018. Customers with new insurance policies are allowed six months from the date of commencement of buying the policy to submit their Aadhaar numbers and PAN/Form 60 to the insurers. Any officially allowed document can also be provided by the customer in the absence of Aadhaar.

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