Important Allowances
| S.NO | Allowance Name | Exempt up to |
| 1 | Children Education Allowance | Rs.100 p.m. per child up to a maximum of 2 children. |
| 2 | Hostel Expenditure Allowance | Rs.300 p.m. per child up to a maximum of 2 children. |
| 3 | Transport Allowance | 1600 p.m. Now it is fully taxable |
| 4 | HOUSE RENT ALLOWANCE (HRA) | Least of following 3 is exempt |
| Actual HRA Recd. | ||
| Rent paid-10%*(Basic +DA ) | ||
| 40%*(Basic + DA) (50% in Metro Cities) |
Other Allowances
| S.No | Allowance Name | Exempt upto |
| 5 | Transport Allowance for Blind/Handicapped Employees | Rs.1600 p.m . (From 2015-16 FY 3200 p.m.) |
| 6 | Tribal Area , Scheduled Area / Agency Area Allowance | Rs.200 p.m. |
| 7 | Special Compensatory Hilly Area Allowance Or High Altitude Allowance | Varies from Rs.300 to Rs.7000 p.m. |
| 8 | Border Area Allowance | Varies from Rs.200 to Rs.1300 p.m. |
| 9 | Compensatory Field Area Allowance | Rs.2600 p.m. |
| 10 | Compensatory Modified Field Area Allowance | Rs.1000 p.m. |
| 11 | Counter Insurgency Allowance Granted To Members Of Armed Forces | Rs.3900 p.m. |
| 12 | Transport Employees Working In Any Transport System | 70% of the allowance , maximum Rs.10000 p.m. |
| 13 | Underground Allowance | Rs.800 p.m. |
| 14 | High Altitude (Uncongenial Climate) Allowance | Altitude of 900. ft. to 15000 ft. Rs. 1060 p.m. and altitude above 15000 ft. Rs.1600 p.m. |
| 15 | Special Compensatory Highly Active Field Area Allowance Granted To Members Of Armed Forces | Rs.4200 p.m. |
| 16 | Island (Duty) Allowance | Rs.3250 p.m. |