Defining Exemptions on Child Education/Child Hostel Allowances 

Purpose

This process describes how to define the wage types for Exemption on Child Education Allowance (CEA)/Child Hostel Allowance (CHA) and assign characteristics to it.

Prerequisites

You must have maintained the details of the expenditure bills, submitted as proofs by the employee, in the Exemptions infotype (0582), SCEA and SCHA subtypes.

Process Flow

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       1.      You must define the tax code for CEA and CHA. To do so, go to the IMG under Payroll India ® Tax ® Tax Liability on Reimbursements, Allowances and Perks ®Define tax Codes. The tax code used for the Exemptions infotype (0582) SCEA subtype is SCEA and for SCHA subtype is SCHA.

       2.      You must configure the wage type for the Exemption Limit and the Tax Code. To do so, go to the IMG under Payroll India ® Tax ® Tax Liability on Reimbursements, Allowances and Perks ® Assign Tax Code limits to Wagetypes.

For further details on configuring the wage type, see INVAL.

For details on configuring each IMG activity, refer to the IMG documentation.

       3.      You must configure the Children Education Allowance exemption payroll function (INCEA), for the parameter settings, in the IMG under Payroll India ® Tax Exemptions ® Maintain Schema for Exemption on Child Education and Hostel Allowances.

See also:

Exemption on Child Education Allowance/Child Hostel Allowance

Exemptions infotype (0582) SCEA/SCHA subtypes