Showing posts with label Automated H.R.A. Exemption Calculator. Show all posts
Showing posts with label Automated H.R.A. Exemption Calculator. Show all posts
Sunday, 9 December 2018
Friday, 5 October 2018
What is HRA (House Rent Allowance)?
HRA or the House Rent Allowance is an amount paid by employers to employees as a part of their salaries. It provides employees with tax benefits for what they pay towards accommodations every year. The decision of how much HRA needs to be paid to the employee is made by the employer based on certain criteria like the salary and the city of residence. The house rent allowance is regulated by the provisions of Section 10(13A) of the IT Act.
Monday, 13 August 2018
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Sunday, 25 February 2018
How to calculate the HRA Exemption in Income Tax U/s 10(13A)
The exemption of House Rent Allowance is computed as the following manners U/s 10
Thursday, 22 February 2018
Some of these exemptions/ deductions are discussed below as per the Income Tax Rules
House Rent Allowance (HRA) U/s 10(13A) - Supporting documents for rent payments to the landlord are required to be submitted to claim the tax exemption on HRA. However, if the HRA received per month is Rs 3,000 or less, the employee need produce any supporting documents for such rent payments, at the time of assessment/ inquiry, shall still have the right to call for the supporting documents.
Thursday, 15 February 2018
Friday, 9 February 2018
Monday, 25 December 2017
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INCOME TAX NEW SLAB RTE FOR F.Y.2017-18
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Saturday, 23 December 2017
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Salary Structure for Assam State Govt Employees
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Sunday, 1 October 2017
The Central Finance Budget has already passed by the Parliament for the Financial Year 2017-18 and also some changes have made in this Finance Budge, The Section 87A will be continue and reduce Tax Rebate From Rs. 5,000/ to 2,500 and U/s 80 TTA (the Savings Bank Interest also entitled in this Financial Year 2017-18), K.V.P. has introduce , P.P.F. Limit has increase up to Rs. 1,50,000/- & Pension Fund U/S 80CC Max Rs.1.5 Lakh.
Thursday, 17 August 2017
Budget 2017-18 & the Finance Bill 2017 have been tabled in Parliament. The income tax rate for those earning between Rs 2.5 lakh and Rs 5 lakh has been halved to 5%. Except for this change, all other Income Tax Slab rates have been kept unchanged by the Finance Minister for the Financial Year 2017-18 (Assessment Year 2018-2019).
Tuesday, 1 August 2017
Budget 2017-18 & the Finance Bill 2017 have been tabled in Parliament. The income tax rate for those earning between Rs 2.5 lakh and Rs 5 lakh has been halved to 5%. Except for this change, all other Income Tax Slab rates have been kept unchanged by the Finance Minister for the Financial Year 2017-18 (Assessment Year 2018-2019).
Tuesday, 6 June 2017
Here are some of the exclusive income tax benefits to own a house as per the Finance Budget 2017-18
1 – House Loan Deduction under Section 80C
The very first tax benefit that comes to your mind is the house loan deduction. When you purchase a house for residential purpose and avail a loan for the same, the IT department gives you a deduction of INR 1, 50, 000 (upper cap) for loan repayment. This means that if you are paying a monthly installment of INR 10, 000 per month towards house loan, you would be getting a deduction of INR 1, 20, 000 while computing your payable tax. However, do make a note that the residential property should not be sold before 5 years from the date of possession, else the benefits would be reversed.
2 – Deduction for payment of Registration Chargers and Stamp Duty
Apart from availing deduction for repayment of house loan, the IT Department also lets you claim a deduction in respect of expenses such as registration charges, stamp duty, etc. This benefit is only available in the year of acquisition. The amount would be claimed under Section 80C and the upper cap would remain at INR 1, 50, 000.
3 – Deduction for interest paid on house loan [Section 24(b)]
Another opportunity lies in Section 24(b). Section 80C lets you grab a deduction in respect of repayment of house loan and Section 24(b) lets you claim a deduction for the interest paid on house loan. Unlike Section 80C, even if you sell your house within 5 years of its acquisition, there would be no tax reversal. An available deduction is INR 2, 00, 000.
4 – Benefit granted in Budget 2017
In the latest budget, the Finance Minister of India announced that an additional deduction of INR 50, 000 would be available to new house owners. Section 80EE would offer the additional deduction provided the cost of a house is not greater than INR 50, 00, 000 and the loan sanctioned amount is not more than INR 35, 00, 000. The deduction is only available if the loan is availed from a house finance company or a financial institute.
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Main Data Sheet
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Cental & State Govt Employees Salary Structure
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Income Tax Computed Sheet
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Friday, 2 June 2017
The person who paid medical insurance premium himself or spouse or parents or depended children can claim the deduction from total income of the person as per the instructions are given below. We will discuss here the complete detail about deduction under section 80D for the A.Y. 2017-18 and A.Y. 2018-19.
Who can claim deduction 80D?
Individual and HUF assessee can claim the deduction under section 80D for any medical insurance premium known as MEDICLAIM.
Note: The deduction is allowed only under an approved scheme of General Insurance Corporation of India or any contribution made to Central Government Health Scheme or any similarly notified scheme.
Maximum deduction allowed u/s 80D
Check how many deductions of medical insurance premium, you can claim for self and your parent.
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F.Y.2017-18/A.Y.2018-19
I – You are below 60 Years – Rs.25,000 and Your parents are also below 60 years – Rs. 25,000 then aggregate Rs. 50,000.
II – You are below 60 Years – Rs.25,000 But Your parents are above 60 years – Rs. 30,000 then aggregate Rs. 55,000.
III – You are above 60 Years – Rs. 30,000 and Your parents are also above 60 years – Rs. 30,000 then aggregate Rs. 60,000.
Note: The maximum deduction for payment on account of preventive health check-up of self, spouse, parent(s) or depended on children, in the aggregate shall be Rs.5,000.
Important Points Related to Deduction under section 80D
· You must note here that the deduction is allowed only if the payment is made from your own income during the pervious year.
· Any premium for health insurance or Central Govt Health Schemes (CGHS) shall be made by any mode except cash. However, cash payment shall be accepted if paid during preventive health check-up.
· Payment made via credit card/internet banking shall also be eligible for deduction.
· The main and important point of Deduction for Medical Insurance Premium (MEDICLAIM) under section 80D is that it does not include in a deduction under section 80C (Rs.1,50,000 in total). In simple words, you can get deduction under section 80D extra over section 80C.
· Now, it is immaterial that parents are dependent on you or not. You can claim the tax deduction for medical insurance premium paid for your parents whether they are dependent on you or not. The condition of dependency of parents is eliminated w.e.f. A.Y. 2009-10.
Tax Planning by MEDICLAIM (Medical Insurance Premium) Under Section 80D
· So it is a good strategy to pay your medical insurance premium yearly for you, wife/husband, children, and parents.
· You can get tax deduction of up to Rs.65000 under section 80D including preventive health check of Rs.5000 (self + family)
· The other thing you must note that medical insurance premium paid for parents having more benefits. It is immaterial that parents are depended or not.
Thats’ all readers, If you would like to buy any health insurance policy then please do your research or consult with your tax professional. Always compare your policy premium, features, benefits, claim etc before buying any health insurance policy. There are some health insurance policies to claim deductions under section 80D (MEDICLAIM). Please ask any query related to health insurance policy, mediclaim, deduction under section 80D through comment form give below. We’ll also suggest you some good health insurance policy if you really want to buy with tax planning.
Wednesday, 17 May 2017
Here are some of the exclusive income tax benefits to own a house as per the Finance Budget 2017-18
1 – House Loan Deduction under Section 80C
The very first tax benefit that comes to your mind is the house loan deduction. When you purchase a house for residential purpose and avail a loan for the same, the IT department gives you a deduction of INR 1, 50, 000 (upper cap) for loan repayment. This means that if you are paying a monthly installment of INR 10, 000 per month towards house loan, you would be getting a deduction of INR 1, 20, 000 while computing your payable tax. However, do make a note that the residential property should not be sold before 5 years from the date of possession, else the benefits would be reversed.
2 – Deduction for payment of Registration Chargers and Stamp Duty
Apart from availing deduction for repayment of house loan, the IT Department also lets you claim a deduction in respect of expenses such as registration charges, stamp duty, etc. This benefit is only available in the year of acquisition. The amount would be claimed under Section 80C and the upper cap would remain at INR 1, 50, 000.
3 – Deduction for interest paid on house loan [Section 24(b)]
Another opportunity lies in Section 24(b). Section 80C lets you grab a deduction in respect of repayment of house loan and Section 24(b) lets you claim a deduction for the interest paid on house loan. Unlike Section 80C, even if you sell your house within 5 years of its acquisition, there would be no tax reversal. An available deduction is INR 2, 00, 000.
4 – Benefit granted in Budget 2017
In the latest budget, the Finance Minister of India announced that an additional deduction of INR 50, 000 would be available to new house owners. Section 80EE would offer the additional deduction provided the cost of a house is not greater than INR 50, 00, 000 and the loan sanctioned amount is not more than INR 35, 00, 000. The deduction is only available if the loan is availed from a house finance company or a financial institute.
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Main Data Sheet
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Cental & State Govt Employees Salary Structure
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Income Tax Computed Sheet
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Thursday, 23 March 2017
Exemptions on Allowances Under Section 10 of Income Tax Act as per Budget 2017
1. House Rent Allowance (HRA)
You may have not noticed but HRA tax exemption may give you maximum benefit. I am missing this deduction after the self-employment. However, this exemption is a real necessity. It is justified and required.
You get a job and shift to another city. Because of your job, you live in a different place. You are forced to live in a rented accommodation. The rented flat is not by choice but because of the duty. Hence, the expense on rent is because of your job. You can’t avoid this, even if you wish. Therefore, government exempts the rent from income tax. However, you are not entitled to get this exemption automatically. Rather, your employer should pay the House rent allowance with the salary.
The HRA paid by the employer is considered for the exemption. I don’t get the HRA exemption because I don’t have an employer who can pay HRA. However, full HRA is not considered for income tax exemption. It is given according to the following formula.
HRA Exemption Formula
Exemption of HRA is a minimum of these three.
1. Actual HRA received.
2. Rent paid less 10% of salary.
3. 40% of Salary (50% in case of Mumbai, Chennai, Kolkata, Delhi). In this case, salary is basic plus dearness allowance (basic+DA).
Download Automated H.R.A. Exemption Calculator in Excel
Leave Travel Allowance
If your employer also gives you an allowance for the vacations, It is also entitled to the income tax exemption. Employers give Leave travel allowance to its employees. you can claim LTA only if you have actually traveled. You must be on leave during this travel. Only travel fare is considered for the exemptions. Hotel stay and the food are not entitled. You can claim income tax exemption only on the travel of yourself and family. The LTA can be claimed only twice in a three-year block. You have to produce the proof of traveling.
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Transport Allowance
You go to your office or workplace from your house. You also spend on the local transport. This expenditure is also forced upon you. Therefore, the government has exempted transport allowance from the income tax, provided your employer gives you the transport allowance. You don’t need to give any receipt of this local travel. However, the tax exemption is limited to Rs 1600/month, and Phy.disable person can get the benefits Rs. 3200 P.M.
Children Education Allowance
Children Education allowance is also exempted from income tax. Your employer must give this allowance for availing the tax exemptions. It is Rs. 100 per month per child up to a maximum of 2 children.
Hostel Subsidy
This is another tax exemption related to your child’s education. It is Rs. 300 per month per child up to a maximum of two children. Your employer must give this allowance.
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Other Allowance Eligible For Income Tax exemptions
Uniform Allowance, Special Compensatory Allowance, High Altitude Allowance, allowances applicable to North East, Compensatory Field Area Allowance, Counter Insurgency Allowance, High Active Field Area Allowance, island duty allowance, tribal allowance etc. These allowances are tax-free, but you need to produce the proof of the actual expense in some cases.
Income Tax Exemption on Interest Paid on Housing Loan
This Exemption is also related to your accommodation because of the job. After shifting to a different place, you may opt for your own house instead of rented accommodation. If you take the home loan for the house, the interest payment is tax exempted. You can get maximum exemption of Rs 2 lakh on housing loan interest. There are some conditions for this exemption.
The house should be self-occupied. You may get this exemption if your home is under construction. however, the construction should complete within 3 years.
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Tax Deductions Under Section 80C
The Government wants to encourage some certain types of investments and expenses. To achieve this goal it gives the benefit of tax deductions under section 80C. There are many investments and expenses under section 80C, 80CCC, and 80CCD. However, the total deductions under this section are limited to Rs 1.5 lakh.
· Employee Provident Fund
· Pension/ Annuity Schemes
· Life insurance premium
· Tax Saving mutual fund (ELSS)
· Home loan principal payment
· Sukanya Samriddhi Account
· Tuition fees of children
· PPF Account Contribution
· National Saving Certificate
· Tax-saving fixed Deposit
· Post office time deposits
Section 80CCC: Deduction For Annuity Plan
You can also get a deduction for the annuity plan of insurance companies. There are some limitations on this deduction.
· You can’t contribute more than 10% of your salary or gross income.
· You can’t enjoy the deduction of more than Rs 1 lakh in a year.
Section 80CCD(1) : Contribution For Pension Plan
Similar to annuities, contribution in pension plans is also eligible for tax deduction. For example contribution to National Pension Scheme (NPS) will get deduction benefit under this rule.
It is also limited to 10% of salary or 10% gross income (if not salaried).
Section 80CCD(2): Contribution To Pension Plan By employer
This section gives you extra tax saving opportunity. If your employer contributes into your pension plan, it would be also tax-free. This contribution does not come under the overall limit of 1.5 lakh.
You can ask your employer to contribute 10% of your salary into your pension plan. It will not affect your employer financially, but you would be able to save some more tax.
Section 80CCD(1B):- Additional deduction Max Rs.50 thousand
Deductions Under Chapter VIA of Income Tax Act
Tax Saving On The Health Insurance Premium of Your Family
You can get a tax deduction of maximum Rs 25,000 on the health insurance premium for self and family. If you are a senior citizen, you can claim the tax deduction on the premium of up to Rs 30,000.
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Tax Saving On The Health Insurance Premium of Your Parents
In Addition to above, you can further claim a tax deduction for the insurance premium of your parents. The maximum limit for this deduction is Rs 25,000. If the parents are a senior citizen, the maximum limit is 30,000.
Section 80D: Preventive Health Check Up Tax Deduction
The Max Limit for below 60 years Rs. 25000/- & Rs. 30,000/- for Sr.Citizen.There is another tax benefit under section 80D. You can also claim a tax deduction for the expense of health check up. The maximum deduction allowed under this provision is 5,000. Health checks up can be of yourself, your family or parents.
Section 80DD: Deduction For Maintenance of Disable Dependent
Under this section, one can get the extra tax deduction of Rs 50,000. To avail this deduction, you must fulfill some conditions.
1. A person with a disability must be dependent upon you. The disability may be physical or mental.
2. You must produce a certificate from the doctor.
3. You must incur the expense of treatment, rehabilitation, nursing, and training.
If you deposit any amount in any scheme for the disabled, it would be also eligible for tax deduction.
If a dependent person is with severe disability, you can claim deduction up to Rs 1,00,000.
Section 80DDB: Serious Illness Deduction
This deduction is for the treatment of serious illness. An assessee can get an income tax deduction of Rs 40,000 under this section.
1. The deduction is at the expense of illness of self or dependent.
2. The illness should be within the prescribed list.
3. There should be the real expense. Any reimbursements of insurance claims should be subtracted.
4. You must give a certificate from the government doctor.
5. For senior citizens, this deduction limit is Rs 80,000.
Section 80E: Deduction on Loan for Higher Studies
Like the home loan interest, one can also claim income tax deduction for education loan interest.
1. You must take education loan from a financial institution.
2. You can avail this tax deduction maximum of 7 years.
3. You can take the benefit of this deduction only for the higher education.
4. You can take this benefit only for the education of self, spouse or children. If you are the legal guardian of a student, you can also take this benefit.
Section 80G: Deduction for Donations
The donations specified in Section 80G are eligible for deduction. The deduction may of 100% of donation or 50%, It depends upon the type of receiver.
Section 80GG: Deduction on House Rent Paid
This deduction is for those, who don’t get the house rent allowance from their employer. Such person can avail this deduction according to the specified rules.
Deduction is the least of
1. Rent paid less 10% of total income
2. Rs. 5000/- Per Month, i.e. Maximum Deduction available is 60,000/- P.A.
3. 25% of total income
There are some conditions for this benefit.
· Assessee or his spouse or minor child should not own residential accommodation at the place of employment.
· He should not get a house rent allowance (HRA).
· He should not have self-occupied residential premises in any other place.
Section 80TTA: Saving Account Interest Deduction
Interest earned on a saving account is not added to taxable income if it is less than Rs 10,000 in a financial year.
Section 87A: Tax Rebate Rs. 2500/- who's Taxable Income not more than 3.5 Lakh.
Section 80U: Deduction For Disabled
Under section 80U a person with a disability gets an extra deduction from his/her taxable income. Such person can deduct Rs 75,000 from the taxable income. In case the disability is severe, the deduction is up to Rs 1,25,000. To avail, this deduction one should obtain a certificate from the government doctor.
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