ITR filing for Railway employees
File your ITR or learn about taxability, applicable ITR form, tax rates, how to save taxes, Documents required and how to file ITR. Contact us to know more!
- ITR filed by CA
- Get ITR in 1 hour
- ITR filing for last 3 years also available
Railway employees play a important role in keeping the nation connected and moving. With a steady salary structure, various allowances, and benefits, understanding income tax return (ITR) filing becomes important to ensure compliance and maximize savings. Whether you’re a newly recruited staff member or a senior official nearing retirement working in various departments including Operations, Engineering, Mechanical, Electrical, Signal & Telecommunication, Personnel, Accounts, Stores, Commercial, Security (RPF), Medical, and Information Technology, filing your ITR accurately and on time is not just a legal duty—it also helps in claiming eligible deductions, avoiding penalties, and securing loans or visas in the future. In this article, we’ll walk you through everything railway employees need to know about ITR filing—types of applicable ITR forms, exemptions on allowances, deductions under various sections, and key due dates to keep in mind.
Latest updates
- ITR filing Due date for FY 2024-25 (2025-26) has been extended from 31st July 2025 to 15th September 2025
Benefits of ITR Filing for Railway employees
Claim refund of excess TDS deducted from salary
Acts as proof of income for home loan, personal loan, business loan credit cards, term insurance or visa processing
Serves as a valid income document for government schemes and subsidies
Builds a consistent financial record useful for future financial planning and investments
Helps prevent late fees and interest by filing within the due date
- Enables carry forward of business or capital losses to future years
Income Tax on Railway Employees
Railway employees in India are subject to the same income tax rules as other salaried individuals, but they may receive certain allowances and benefits that attract specific exemptions.
The income earned by railway staff—such as basic pay, dearness allowance (DA), house rent allowance (HRA), and other special allowances—is taxed under the head “Income from Salary.” If an employee lives in rented accommodation and receives HRA, they can claim an exemption under Section 10(13A) of the Income Tax Act, subject to conditions. However, if the employee lives in government-provided quarters, no HRA exemption is allowed.
Under the old tax regime, deductions such as the standard deduction of ₹50,000, deductions under Section 80C (up to ₹1.5 lakh), Section 80D for health insurance premiums, and others are available. Allowances like transport, uniform, and transfer allowances may also be exempt, fully or partially, depending on their use and documentation.
Railway employees can choose between the old and new tax regimes, with the former allowing deductions and exemptions, while the latter offers lower tax rates but limited deductions. Upon retirement, pension received by a retired railway employee is taxable as salary, while family pension received by a spouse is taxable under “Income from Other Sources,” with a partial exemption. Proper documentation and tax planning can help railway employees optimize their tax liability effectively.
Railway Employee Salary Structure Overview (Post-7th Pay Commission)
1. Components of Salary
Railway employees receive the following salary components:
| Component | Description |
|---|---|
| Basic Pay | Fixed as per pay level (varies by post) |
| Dearness Allowance (DA) | ~46% of Basic Pay (as of Jan 2024) |
| House Rent Allowance (HRA) | 8%, 16%, or 24% of Basic Pay depending on city |
| Transport Allowance | Fixed monthly amount (varies by city/class) |
| Other Allowances | Includes Night Duty Allowance, Running Allowance (for train staff), Uniform Allowance, etc. |
2. Pay Matrix Levels (7th CPC)
| Group | Common Designation | Pay Level | Approx Basic Pay Range |
|---|---|---|---|
| Group A | IRAS, IRTS, IRSE, IRSSE (via UPSC) | Level 10–17 | ₹56,100 – ₹2,25,000+ |
| Group B | Section Officers, Supervisors | Level 6–9 | ₹35,400 – ₹53,100 |
| Group C | Clerks, Station Masters, Technicians | Level 2–6 | ₹19,900 – ₹35,400 |
| Group D | Trackman, Helper, Porter | Level 1–2 | ₹18,000 – ₹19,900 |
3. Example Salary of Selected Posts (Approx)
| Post | Basic Pay | DA (46%) | HRA (16%) | Gross Salary (Est.) |
|---|---|---|---|---|
| Assistant Loco Pilot | ₹19,900 | ₹9,154 | ₹3,184 | ₹33,000 – ₹36,000 |
| Station Master | ₹35,400 | ₹16,284 | ₹5,664 | ₹55,000 – ₹60,000 |
| Junior Engineer | ₹35,400 | ₹16,284 | ₹5,664 | ₹55,000 – ₹60,000 |
| Group A Officer (Level 10) | ₹56,100 | ₹25,806 | ₹8,976 | ₹85,000 – ₹95,000 |
4. Additional Perks & Benefits
Railway Passes: Free or concessional travel for self and family
Pension and Gratuity
Medical Facilities
Night duty and overtime allowances
Special duty allowances for hard postings (e.g., Northeast, hilly areas)
Deductions and exemptions available to railway employees
Deductions and exemptions available to railway employees are largely the same as those available to other salaried individuals under the Income Tax Act. These benefits help reduce taxable income and are available mainly under the old tax regime. Here’s a summary:
Exemptions for Railway Employees
These reduce gross salary before taxation:
House Rent Allowance (HRA) – Exempt under Section 10(13A) if living in rented accommodation.
Transport Allowance – Exempt up to ₹1,600/month (₹3,200 for differently-abled) under the old regime.
Uniform Allowance – Exempt if used for official duty and actual expenses are incurred.
Travelling/Conveyance Allowance – Exempt when reimbursed for official travel or transfer.
Running Allowance (for train-running staff like loco pilots, guards) – Exempt up to 70% or ₹10,000 per month, whichever is less, if duties involve continuous movement.
Children Education Allowance – Exempt up to ₹100/month per child (max 2 children).
Hostel Expenditure Allowance – Exempt up to ₹300/month per child (max 2 children).
Note: These exemptions are not available under the new tax regime, except for a few like employer NPS contributions.
Deductions under Old Tax Regime
These reduce total taxable income:
Standard Deduction – ₹50,000 for all salaried individuals ( ₹75,000 in New tax regime).
Section 80C – Up to ₹1.5 lakh for investments like LIC, PPF, EPF, tuition fees, ELSS, principal repayment on home loan, etc.
Section 80D – Medical insurance premium (up to ₹25,000 for self/family + ₹50,000 for senior citizen parents).
Section 80CCD(1B) – Additional ₹50,000 for NPS contributions.
Section 80TTA – Deduction up to ₹10,000 on savings account interest.
Section 80E – Interest on education loans (no cap).
Section 24(b) – Interest on home loan up to ₹2 lakh per annum for self-occupied property.
Under New Tax Regime
Railway employees opting for the new regime get reduced tax rates but most exemptions and deductions are disallowed, except:
Income tax slab rates for railway employees
Old tax Regime
| Income | Tax rates |
| Upto ₹ 2.50 lakh | 0% |
| ₹ 2.50 lakh – ₹ 5 lakh | 5% |
| ₹ 5 lakh – ₹ 10 lakh | 20% |
| Above ₹ 10 lakh | 30% |
You Can claim deduction under Section 80C, 80D, 80G, etc
For senior citizen (age between 60 & 80 years), tax rate is 0% upto ₹ 3 lakhs. Rest of the rates are same.
For super senior citizen (age above 80 years), tax rate is 0% upto ₹ 5 lakhs. Rest of the rates are same.
In Old tax regime, a maximum tax rebate under section 87A of Rs. 12,500 is available for income upto Rs. 5 lakhs meaning your income is totally tax free till Rs. 5 lakhs. The rebate under section 87A is not allowed to a Non-resident.
New tax Regime (FY 23-24)
| Income | Tax rates |
| Upto ₹ 3 lakh | 0% |
| ₹ 3 lakh – ₹ 6 lakh | 5% |
| ₹ 6 lakh – ₹ 9 lakh | 10% |
| ₹ 9 lakh – ₹ 12 lakh | 15% |
| ₹ 12 lakh – ₹ 15 lakh | 20% |
| More than ₹ 15 lakh | 30% |
New tax Regime (FY 24-25)
Income | Tax Rate |
Upto ₹ 3 lakh | 0% |
₹ 3 lakh – ₹ 7 lakh | 5% |
₹ 7 lakh – ₹ 10 lakh | 10% |
₹ 10 lakh – ₹ 12 lakh | 15% |
₹ 12 lakh – ₹ 15 lakh | 20% |
Above ₹ 15 lakh | 30% |
New tax Regime (FY 25-26)
| Income Range (₹) | Tax Rate |
|---|---|
| Upto ₹ 4 lakh | Nil |
| ₹ 4 lakh – ₹ 8 lakh | 5% |
| ₹ 8 lakh – ₹ 12 lakh | 10% |
| ₹ 12 lakh – ₹ 16 lakh | 15% |
| ₹ 20 lakh – ₹ 20 lakh | 20% |
| ₹ 20 lakh – ₹ 24 lakh | 25% |
| Above ₹ 24 lakh | 30% |
Is ITR filing for railway employees mandatory?
No, ITR filing is not required if your income from all sources including salary income is below the basic exemption limit of Rs. 2,50,000.
But even though it is not compulsory, it is highly recommended as it helps in building financial history, serves as income proof for applying for loan, credit card, Visa.
Which ITR form is applicable for railway employees?
The applicable Income Tax Return (ITR) form for railway employees depends on the nature and amount of their income. In most cases, salaried railway employees with income from salary, pension, one house property, and other sources like interest should file ITR-1 (Sahaj), provided their total income does not exceed ₹50 lakh and they do not have capital gains or foreign assets.
If their income exceeds ₹50 lakh, or if they have more than one house property, capital gains, or income from business/profession (like freelancing or contractual work post-retirement), they must file ITR-2 or ITR-3, depending on the specific sources of income.
Pensioners from Indian Railways can also use ITR-1, subject to the same conditions.
Step-by-Step Guide for ITR filing for Railway employees
1. Registering on the Income Tax E-Filing Portal
- Visit the Portal: Go to the official Income Tax Department e-filing website
- New User Registration: If you are a first-time user, click on ‘Register Yourself’. Choose the ‘Individual’ category and enter your PAN, which will serve as your User ID.
- Fill in Details: Provide your basic details, contact information, and create a password.
2. Choosing the Correct ITR Form (ITR-1 or ITR-2)
3. Filling Out Personal Details and Income Information
- Select the Assessment Year: Choose the appropriate assessment year for which you are filing the return.
- Income Details: Enter your income details under the appropriate heads:
4. Claiming Deductions and Exemptions
- Deductions under Section 80C: Enter eligible deductions such as life insurance premiums, PPF, NSC, and tuition fees.
- Deductions under Section 80D: Include premiums paid for health insurance.
- Other Deductions: Claim deductions under other sections like 80E for education loan interest, 80G for donations, etc.
5. Verifying and Submitting the Return
- Tax Payment: If there is any tax payable, pay it through the e-filing portal using net banking or other available options.
- Preview and Submit: Preview the completed ITR form, ensure all details are correct, and click ‘Submit’.
- Verification: After submission, verify your ITR within 30 days of filing. You can e-verify using methods such as Aadhaar OTP, net banking, or through a digital signature. Alternatively, you can send a physical signed copy of ITR-V to the Centralized Processing Center (CPC).
What is the Due date of ITR filing for Railway employees?
The Due date to file Income tax return for railway employees is 31st July.
In case you have missed this deadline then you can file belated ITR till 31st December with late fees.
Also for any mistake made while filing ITR before 31st July, you can make corrections by filing Revised ITR any number of times till 31st December.
If you miss deadline of Belated income tax return filing then you can file Updated ITR till 2 years from the end of relevant assessment year with late fees and additional taxes.
What are the Consequences of non-payment of Tax and non-filing of ITR by Railway employees?
Failing to pay taxes and file your Income Tax Return (ITR) has severe consequences. Firstly, unreported income is deemed illegal, equating to tax evasion, and can result in a penalty of 100% to 300% of the evaded tax under Section 271(C). Secondly, a penalty ranging from 10% to 90% of the undisclosed amount may be imposed under Section 271AAB, depending on the circumstances. Lastly, if you miss the filing deadline, a 1% interest per month or part thereof will be charged on the unpaid tax amount as per Section 234A.
Looking for help?
At A R Dhorajiya & Co., we specialize in income tax return filing for railway employee. From choosing the right ITR form to optimizing deductions, we ensure complete compliance with minimal effort on your part.
Let us handle your ITR filing so you can focus on your job.
Contact us today at +91 9769647582 for a consultation or to get started with your ITR filing
Frequently Asked Questions
Yes, railway employees are liable to pay income tax like any other salaried individuals in India. Their income is taxed based on the applicable income tax slab rates under the Income Tax Act, 1961.
Railway employees can obtain Form 16 from their respective Accounts or Pay & Accounts Office. It is usually issued by the Drawing and Disbursing Officer (DDO) after the end of the financial year, typically by June. Some zones may also provide access through online employee portals.
Yes, a railway employee is considered a Central Government employee, as Indian Railways is owned and operated by the Government of India under the Ministry of Railways.
Yes, railway pension is taxable depending on the type:
Monthly (Uncommuted) Pension: Fully taxable under the head “Salaries”.
Commuted Pension (Lump Sum): Fully exempt from tax for railway (government) employees.
So, retired railway employees pay tax on monthly pension but can enjoy full exemption on any lump-sum commuted pension received.
What our clients say
Recieved ITR Certification in less than 3 hours for a affordable cost.
Highly recommended.
With Warm Regards
Arvind Mishra
Many appreciations with thanks,
Dr.Gautam Makwana
Transparent communication,
Happy with the outcome.
Thank you!
RECOMMENDED
All Services across Bharat
- Income tax
- GST
- Business registration
- Accounting
- Audit
- ROC filings
- Certificates
- Project report or CMA data
