Laid off? Here’s how your severance pay will be taxed
- Press Release|
- < 1 minute
- By Taxmann
- Last Updated on 20 November, 2020
However, if the severance pay is in accordance with the provisions of Industrial Dispute Act, 1947, then the employee is entitled to an exemption of up to 5 lakh as per section 10(10B) of the Income Tax Act. “It is to be noted that Industrial Dispute Act, 1947, doesn’t apply to employees who are working in a managerial or administrative capacity or employed in a supervisory capacity and draw wages exceeding 10,000 per month.”
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