Profit in lieu of salary u/s 17(3)

Following are the taxable to all types of employees as Profit in lieu of salary u/s 17(3):- :-

1) Compensation received by employee from previous employer for premature termination of service.

Less – Exemption u/s 10(10B), least of the following :-

(i) Actual compensation receive, (ii) Maximum Rs. 5,00,000, (iii) amount calculated as per industrial

dispute Act 

I,e 15 days average salary for completed year of service (if fractional year is more than 6 month then it

is considered as full year).

2) Compensation received by employee from his present employer for modification of terms of

employment.

3) Any payment received by employee from his employer in appreciation of his service. 

4) Lump sum amount received from unrecognized provident fund – employer’s contribution and interest

thereon.

5) Lump sum amount received before joining or after retirement of service.

6) Annuity from ex-employer.