Download All in One TDS on Salary for Only Private Employees for FY 2014-15 [ This Excel Utility can prepare at a time your Tax Compute sheet + Salary Structure + HRA Exemption Calculation + Automated Form 16 Part A&B and Form 16 Part B]
DEDUCTIONS [AY 2015-16]
Section
|
Nature of deduction
|
Who can claim
|
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(1)
|
(2)
|
(3)
|
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Against 'salaries'
|
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Entertainment allowance
[actual or at the rate of
1/5th of salary, whichever
is less] [limited to Rs.
5,000]
|
Government employees
|
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Employment tax
|
Salaried assessees
|
||||
Against 'income
from house properties'
|
|||||
23(1),
first proviso
|
Taxes levied by local authority
and borne by owner if
paid in relevant previous year
|
All assessees
|
|||
Standard deduction [30%
of the annual value
(gross annual value less
municipal taxes)]
|
All assessees
|
||||
Interest on borrowed
capital
(Rs. 30,000/Rs. 1,50,0001,
subject to specified conditions)
|
All assessees
|
||||
Standard deduction of
30 per cent of arrears of
rent received
|
All assessees who has
received arrears of rent
|
||||
Against 'profits and gains of
business or profession'
A. Deductible items
|
|||||
Rent, rates, taxes, repairs (excluding
capital expenditure) and insurance for premises
|
All assessees
|
||||
Repairs (excluding capital expenditure)
and insurance of machinery, plant and furniture
|
All assessees
|
||||
Depreciation on buildings, machinery, plant or
furniture, know-how, patents, copyrights,
trade marks, licences, franchises, or any
other business or commercial rights of similar nature,
being intangible assets -
Prescribed percentage on
WDV in the case of any block of assets2
|
All assessees
|
||||
Investment in new plant and machinery between
1-4-2013 and 31-3-2015 (subject to certain
conditions and limits)
|
A company engaged in
manufacture or production
of
any article or thing
|
||||
Development allowance - 50 per cent of actual
cost of planting (subject
to certain conditions
and limits) (planting should have been completed
before 1-4-1990)
|
Assessee engaged in business
of growing and manufacturing
tea in
|
||||
Tea/Coffee/Rubber Development Account
-
Amount
deposited in account with National
-
Bank
(Special Account) or in Deposit
-
Account
of Tea Board, Coffee Board
-
or
Rubber Board in accordance with
-
approved scheme or 40% of profits
-
of
business, whichever is less (subject
-
to
certain conditions)
|
Assessees engaged in business
of growing and
manufacturing
tea/Coffee/Rubber in
|
||||
Amount deposited in Special Account
with SBI/Site Restoration Account or
20 per cent of profits, whichever is less
(subject to certain conditions)
|
Assessee carrying on business
of prospecting for, or extraction
or production of, petroleum or
natural gas or both in
|
||||
Expenditure on scientific research
for certain specific purposes (subject to
certain conditions)4
|
All assessees
|
||||
Expenditure incurred before 1-4-1998 on
acquisition of patent rights or copyrights
[equal to appropriate
fraction of expenditure
on acquisition to be
deducted in fourteen
equal annual instalments
beginning with
previous year in which
such expenditure
has been incurred] (subject to certain conditions)
|
All assessees
|
||||
Lump sum payment made in any previous year
relevant to assessment
year commencing on or
before 1-4-1998, for
acquisition of technical
know-how [consideration
for acquisition to
be deducted in six equal annual instalments
(3 equal annual
instalments where know-how
is developed in certain
laboratories,
universities and institutions)]
(subject to certain conditions)
|
All assessees
|
||||
Expenditure incurred for obtaining licence
to operate telecommunication services
either before commencement of such business
or thereafter at any time
during any previous year
|
All assessees
|
||||
Expenditure by way of payment of any sum
to a public sector company/local
authority/approved association or institution
for carrying out any eligible scheme or project
(subject to certain conditions)
|
All assessees
|
||||
Capital expenditure incurred, wholly and
exclusively, for the purpose of any
specified business [setting up and operating
a cold chain facility; setting up and operating a
warehousing facility for
storage of agricultural
produce; laying and
operating a cross-country
natural gas or crude or petroleum oil pipeline
network for distribution, including storage
facilities being an integral part of such network;
building and operating,
anywhere in
hotel of two-star or above category as
classified by the Central Government;
building and operating,
anywhere in
a hospital with at least one hundred beds
for patients; developing
and building a
notified housing project under a
scheme for slum redevelopment or rehabilitation
framed by the Government,
as the case may
be, in accordance with
prescribed guidelines;
developing and building a notified housing
project under a scheme for affordable housing
framed by the Government,
as the case
may be, in accordance with prescribed
guidelines; production of
fertilizer in
setting up and operating an inland container
depot or a container
freight station
which is
approved/notified under the Customs
Act, 1962; bee-keeping
and production of
honey and beeswax; and setting up and
operating a warehousing facility for storage
of sugar5,
carried on by the assessee during
the previous year in
which such expenditure
is incurred (subject to certain conditions)
|
All assessees
|
||||
Payment to associations/institutions for carrying
out rural development
programmes (subject
to certain conditions)
|
All assessees
|
||||
Expenditure incurred before 1-4-2002 by way of
payment to approved associations/institutions
for carrying out approved programmes of
conservation of natural resources or afforestation
(subject to certain conditions)
|
All assessees
|
||||
One and a half times of expenditure on notified
agricultural extension project (subject to certain
conditions)
|
All assessees
|
||||
One and a half times of expenditure on
notified skill development project
(subject to certain conditions)
|
A company
|
||||
Amortisation of certain preliminary expenses
[deductible in 5 equal annual instalments]
(subject to certain conditions)
|
Indian companies and resident
non-corporate assessees
|
||||
Amortisation of expenditure incurred after
31-3-1999 in case of
amalgamation or
demerger in the hands of an Indian company
(one-fifth of such
expenditure for 5 successive
previous years) (subject
to certain conditions)
|
Indian Company
|
||||
Amortisation of expenditure incurred under
voluntary retirement
scheme in 5 equal annual
instalments starting with
the year when the
expenditure is incurred
|
All assessees
|
||||
Expenditure on prospecting, etc., for
certain minerals [deductible in ten equal annual
instalments] (subject to
certain conditions)
|
Indian companies and
resident non-corporate
assessees engaged in prospecting,
etc., for minerals
|
||||
Insurance premium covering risk of damage
or destruction of stocks/stores
|
All assessees
|
||||
Insurance premium covering life of cattle
owned by a member of co-operative society
engaged in supplying milk
to federal milk
co-operative society
|
Federal milk co-operative
societies
|
||||
Medical insurance premium paid by any mode
other than cash, to
insure employee's health
under (a) scheme
framed by GIC of India
and approved by Central Government;
or (b) scheme framed by any other insurer
and approved by IRDA
|
All assessees as employers
|
||||
Bonus or commission paid to employees
|
All assessees
|
||||
Interest on borrowed capital
|
All assessees
|
||||
Pro rata amount of discount on a zero coupon
bond based on life of such bond and
calculated in prescribed manner
|
All assessees
|
||||
Contributions to recognised provident fund
and approved superannuation fund [subject
to certain limits and conditions]
|
All assessees as
employers
|
||||
Any sum paid by assessee-employer by way
of contribution towards a pension scheme,
as referred to in section
80CCD, on account of
an employee to the extent
it does not exceed
10 per cent of the employee's salary in the
previous year.
|
All assessees as
emloyers
|
||||
Contributions to approved gratuity fund
[subject to certain
limits and conditions]
|
All assessees as
employers
|
||||
Contributions to any provident fund or
superannuation fund or
any fund set up
under Employees' State Insurance Act, 1948 or
any other fund for
welfare of such employees,
received from employees
if the same are
credited to the employee's account in relevant
fund or funds before due
date
|
All assessees as
employers
|
||||
Allowance in respect of animals which have
died or become
permanently useless
[subject to certain conditions]
|
All assessees
|
||||
Bad debts which have been written off as
irrecoverable [subject to limitation in the case of
banks and financial
institutions]
|
All assessees
|
||||
Provision for bad and doubtful debts
|
|||||
■ up to 7½ per cent of total income before
making any deduction
under this clause and
Chapter VI-A, and up to
10 per cent of
aggregate average advances made by
its rural branches
|
Certain scheduled banks,
non-scheduled banks
(but other than foreign banks)
and co-operative bank
(other than primary agricultural
credit society or primary co-operative
agricultural and rural
development
bank)
|
||||
■ up to 5 per cent (10% in case of Public
Financial Institutions,
State Financial
Corporations and State Industrial
Investment Corporations in any of
the two consecutive
assessment
years 2003-04 and 2004-05 – subject
t to certain conditions) of total
income before making any
deduction under this clause and Chapter VI-A
|
Foreign banks/Public financial
institutions/State
financial
corporations/State industrial
investment corporations
|
||||
Amounts transferred to special reserve
[subject to certain
conditions and maxi-mum of
20 per cent of profits
derived from eligible business]
|
Specified entities, namely,
financial corporations/financial
corporation which is a
public
sector company/banking
company/co-operative bank
other than a primary agricultural
credit society or a
primary
co-operative agricultural
and
rural development
bank/housing
finance company/any other
financial corporation
including a
public company
|
||||
Expenditure for promoting family planning
amongst employees
(deductible in 5 equal annual installments in
case of capital expenditure)
|
Companies
|
||||
Expenditure incurred wholly and exclusively
by the assessee on or
after the 1st
April, 1999 but before the 1st April, 2000 in
respect of a non-Y2K compliant system,
owned by the assessee and used for the
purposes of his business or profession, so
as to make such system
Y2K compliant
computer system
|
All assessees
|
||||
Any expenditure (not being in the nature
of capital expenditure) incurred by a notified
corporation or body corporate, by whatever
name called, constituted or established by a
Central, State or Provincial Act, for the
objects and purposes
authorised by the Act
under which such
corporation or body
corporate was constituted or established
|
Notified corporation or body
corporate, by whatever
name
called, constituted or
established
by a Central, State or
Provincial
Act
|
||||
Any banking cash transaction tax paid during the previous year
on taxable banking transaction entered into by the assessee
|
All assessees
|
||||
Contribution to notified credit guarantee trust fund for small
industries
|
Public financial institution
|
||||
Securities Transaction Tax paid if corresponding income is
included as income under the head 'Profits and gains of business or
profession'
|
All assessees
|
||||
Amount equal to commodities transaction tax paid by an assessee
in respect of taxable commodities transactions entered into in the course of
his business during the previous year, if the income arising from such
transactions is included in the income computed under the head "Profits
and gains of business or profession"
|
All assessees
|
||||
Any other expenditure [not being personal or capital expenditure
and expenditure mentioned in sections
30 to 36]
laid out wholly and exclusively for purposes of business or profession6
|
All assessees
|
||||
B. Non-deductible
items
|
|||||
Advertisement in souvenir, brochure, tract, pamphlet, etc., of
political party
|
All assessees
|
||||
Interest, royalty, fees for technical services or other
chargeable sum payable outside
|
All assessees
|
||||
Any interest, commission or brokerage, rent, royalty, fees for
professional services or fees for technical services payable to a resident,
or amounts payable to a contractor or sub-contractor, being resident, for
carrying out any work (including supply of labour for carrying out any work)8,
on which tax is deductible at source under Chapter XVII-B and such tax has
not been deducted or, after deduction, has not been paid on or before the due
date specified in sub-section (1) ofsection
139.
|
All assessees
|
||||
However, where in respect of any such sum, tax has been deducted
in any subsequent year, or has been deducted during the previous year but
paid after the due date specified in sub-section (1) of section
139, such sum shall be allowed as a deduction in computing the income of
the previous year in which such tax has been paid.
|
|||||
Rate or tax levied on the profits or gains of any business or
profession
|
All assessees
|
||||
Wealth-tax paid
|
All assessees
|
||||
Amount paid by way of royalty, licence fee, service fee,
privilege fee, service charge or any other fee or charge, by whatever name
called, which is levied exclusively on, or any amount which is appropriated,
whether directly or indirectly, from a State Government undertaking by the
State Government
|
State Govt. undertakings
|
||||
Salaries payable outside
|
All assessees as employers
|
||||
Payments to provident fund/other funds for employees' benefit
for which no effective arrangements are made to secure that tax is deducted
at source on payments made from such funds which are chargeable to tax as
'salaries'
|
All assessees as employers
|
||||
Tax actually paid by an employer referred to in section
10(10CC)
|
All assessees as employers
|
||||
Interest, salary, bonus, commission or remuneration paid to
partners (subject to certain conditions and limits)
|
Firms
|
||||
Interest, salary, bonus, commission or remuneration paid to
members (subject to certain conditions and limits)
|
Association of persons or body
of individuals
(except a company or a
co-operative society,
society registered under Societies
Registration Act, etc.)
|
||||
Expenditure involving payment to
relative/director/partner/substantially interested person, etc., which, in
the opinion of the Assessing Officer, is excessive or unreasonable
|
All assessees
|
||||
100% of payments exceeding Rs. 20,000 (Rs. 35,000 in case of
payment made for plying, hiring or leasing goods carriages) made to a person
in a day otherwise than by account payee cheque/bank draft (subject to
certain conditions)
|
All assessees
|
||||
Any provision for payment of gratuity to employees, other than a
provision made for purposes of contribution to approved gratuity fund or for
payment of gratuity that has become payable during the year (subject to
specified conditions)
|
All assessees as employers
|
||||
Any sum paid for setting up or formation of, or as contribution
to, any fund, trust, company, AOP, BOI, Society or other institution, other
than recognised provident fund/approved superannuation fund/pension scheme
referred to in section
80CCD/approved gratuity fund
|
All assessees as employers
|
||||
C. Other deductible items
|
|||||
In case of mineral oil concerns allowances specified in
agreement entered into by Central Government with any person (subject to
certain conditions and terms of agreement)
|
Assessees
engaged in
prospecting
for or extraction or
production
of mineral oils
|
||||
In case of mineral oil concerns expenditure incurred remaining
unallowed as reduced by proceeds of transfer
|
Assessee whose business
consists of prospecting for
or extraction or production of petroleum and natural gas and who
transfers any interest in such business
|
||||
Any sum which is actually paid, relating to (i)
tax/duty/cess/fee levied under any law, (ii) contribution to provident
fund/superannuation fund/gratuity fund/any fund for employees' welfare, (iii)
bonus/commission to employees, (iv) interest on loan/borrowing from
any public financial institution, State Financial Corporation or State
Industrial Investment Corporation/interest payments to scheduled
banks/Co-operative banks on loans or advances, and (v) sum payable by
employers by way of leave encashment to employees. Deduction will not be
allowed in year in which liability to pay is incurred unless actual payment
is made in that year or before the due date of furnishing of return of income
for that year
|
All assessees
|
||||
Expenditure in excess of subscription, etc., received from
members (subject to certain conditions and limits)
|
Trade, professional or similar
association
|
||||
Head office expenditure (subject to certain conditions and
limits)
|
Non-resident
|
||||
Against 'capital gains'
|
|||||
Expenditure incurred wholly and exclusively in connection with
transfer of capital asset
|
All assessees
|
||||
Cost of acquisition of capital asset and of any improvement
thereto (indexed cost of acquisition and indexed cost of improvement, in case
of long-term capital assets)
|
All assessees
|
||||
Long-term capital gains on sale of residential house and land
appurtenant thereto invested in purchase/construction of another residential
house9 (subject to certain conditions and
limits)
|
Individual/HUF
|
||||
Capital gains on transfer of land used for agricultural purposes,
by an individual or his parents or a HUF, invested in other land for
agricultural purposes (subject to certain conditions and limits)
|
Individual/HUF
|
||||
Capital gains on compulsory acquisition of land or building
forming part of an industrial undertaking invested in purchase/construction
of other land/building for shifting/re-establishing said undertaking or
setting up new industrial undertaking (subject to certain conditions and
limits)
|
Any assessee
|
||||
Net consideration on transfer of long-term capital asset made
before 1-4-2000 invested in specified bonds, debentures, shares of a public
comp-any or units of notified mutual funds (subject to certain conditions and
limits)
|
Any assessee
|
||||
Long-term capital gains on transfer of any long-term capital
asset made be-fore 1-4-2000 invested in specified long-term assets (subject
to certain conditions and limits)
|
Any assessee
|
||||
Long-term capital gains invested in long-term specified asset
(bond redeemable after 3 years) (maximum investment in a financial year is
Rs. 50 lakhs)10 issued by National Highways
Authority of India; or by the Rural Electrification Corporation Limited
(subject to certain conditions and limits)
|
Any assessee
|
||||
Long-term capital gains on transfer before 1-4-2006 of certain
listed securities or units invested in equity shares forming part of an
eligible issue of capital (subject to certain conditions and limits)
|
Any assessee
|
||||
Net consideration on transfer of long-term capital asset other
than residential house invested in residential house11(subject
to certain conditions and limits)
|
Individual/HUF
|
||||
Capital gain on transfer of machinery, plant, land or building
used for the purposes of the business of an industrial undertaking situate in
an urban area (transfer being effected for shifting the undertaking to a
non-urban area) invested in new machinery, plant, building or land, in the
said non-urban area, expenses on shifting, etc. (subject to certain conditions
and limits)
|
Any assessee
|
||||
Exemption of capital gains on transfer of assets in cases of
shifting of industrial undertaking from urban area to any Special Economic
Zone (subject to certain conditions and limits)
|
All assessees
|
||||
Exemption in respect of capital gain arising from the transfer
of a long-term capital asset, being a residential property (a house or a plot
of land), owned by the eligible assessee, and such assessee before the due
date of furnishing of return of income under sub-section (1) of section
139 utilises the net
consideration for subscription in the equity shares of an eligible company
and such company has, within one year from the date of subscription in equity
shares by the assessee, utilised this amount for purchase of specified new
asset (subject to certain conditions and limits).
|
Individual/HUF
|
||||
Against 'income from other
sources'
A. Deductible items
|
|||||
Any reasonable sum paid by way of commission or remuneration for
purpose of realising dividend (other than dividends referred to in section
115-O)
|
All assessees
|
||||
Any reasonable sum paid by way of commission or remuneration for
the purpose of realising interest on securities
|
All assessees
|
||||
Contributions to any provident fund or superannuation fund or
any fund set up under Employees' State Insurance Act, 1948 or any other fund
for welfare of employees, if the same are credited to employees' accounts in
relevant funds before due date
|
All assessees
|
||||
Repairs, insurance, and depreciation of building, plant and
machinery and furniture
|
Assessees engaged in business
of letting out of
machinery,
plant and furniture and buildings on hire
|
||||
In case of family pension, 331/3 per cent of such pension or Rs.
15,000, whichever is less
|
Assessees in receipt of family
pension on death of employee
being member of assessee's family
|
||||
Any other expenditure (not being capital expenditure) expended
wholly and exclusively for earning such income
|
All assessees
|
||||
In case of interest received on compensation or on enhanced compensation
referred to in section
145A(2), a deduction of 50 per cent of such income (subject to certain
conditions)
|
All assessees
|
||||
B.
Non-deductible items
|
|||||
Personal expenses
|
All assessees
|
||||
Interest chargeable to tax which is payable outside
|
All assessees
|
||||
'Salaries' payable outside
|
All assessees
|
||||
Wealth-tax
|
All assessees
|
||||
Expenditure of the nature specified in section
40A
|
All assessees
|
||||
Expenditure in connection with winnings from lotteries,
crossword puzzles, races, games, gambling or betting
|
All assessees
|
||||
For certain
payments
|
|||||
■ Life insurance premium for policy :
- in case of individual, on life
of assessee, assessee's spouse and any child of assessee
- in case of HUF, on life of any
member of the HUF
■ Sum paid under a contract for a deferred
annuity :
- in case of individual, on life
of the individual, individual's spouse and any child of the individual
(however, contract should not contain an option to receive cash payment in
lieu of annuity)
■ Sum deducted from salary payable to
Government servant for securing deferred annuity or making provision for his
wife/children [qualifying amount limited to 20% of salary]
■ Contributions by an individual made under
Employees' Provident Fund Scheme
■ Contribution to Public Provident Fund
Account in the name of:
- in case of individual, such
individual or his spouse or any child of such individual
■ Contribution by an employee to a recognised
provident fund
■ Contribution by an employee to an approved
superannuation fund
■ Subscription to any notified security or
notified deposit scheme of the Central Government
■ Subscription to notified savings
certificates [National Savings Certificates (VIII Issue)]
■ Contribution for participation in
unit-linked Insurance Plan of UTI :
- in case of an individual, in
the name of the individual, his spouse or any child of such individual
- in case of a HUF, in the name
of any member thereof
■ Contribution to notified unit-linked
insurance plan of LIC Mutual Fund [Dhanaraksha 1989]
- in the case of an individual,
in the name of the individual, his spouse or any child of such individual
- in the case of a HUF, in the
name of any member thereof
■ Subscription to notified deposit scheme or
notified pension fund set up by National Housing Bank [Home Loan Account
Scheme/National Housing Banks (Tax Saving) Term Deposit Scheme, 2008]
■ Tuition fees (excluding development fees,
donations, etc.) paid by an individual to any university, college, school or
other educational institution situated in India, for full time education of
any 2 of his/her children
■ Certain payments for purchase/construction
of residential house property
■ Subscription to notified schemes of (a)
public sector companies engaged in providing long-term finance for
purchase/construction of houses in
■ Sum paid towards notified annuity plan of
LIC (New Jeevan Dhara/New Jeevan Dhara-I/New Jeevan Akshay/New Jeevan
Akshay-I/New Jeevan Akshay-II/Jeewan Akshay-III plan of LIC) or other insurer
■ Subscription to any units of any notified
[u/s 10(23D)] Mutual Fund or the UTI (Equity Linked Saving Scheme,
2005)
■ Contribution by an individual to any
pension fund set up by any mutual fund which is referred to in section
10(23D) or by the
UTI (UTI Retirement Benefit Pension Fund)
■ Subscription to equity shares or debentures
forming part of any approved eligible issue of capital made by a public
company or public financial institutions
■ Subscription to any units of any approved
mutual fund referred to in section
10(23D), provided amount of subscription to such units is
subscribed only in 'eligible issue of capital' referred to above.
■ Term deposits for a fixed period of not
less than 5 years with a scheduled bank, and which is in accordance with a
scheme12 framed and notified.
■ Subscription to notified bonds issued by
the NABARD.
■ Deposit in an account under the Senior
Citizen Savings Scheme Rules, 2004 (subject to certain conditions)
■ 5-year term deposit in an account under the
Post Office Time Deposit Rules, 1981 (subject to certain conditions)
|
Individual/HUF
|
||||
Notes:
1. Deduction
is limited to whole of the amount paid or deposited subject to a maximum of Rs.
1,00,00013.
This maximum limit of Rs. 1,00,00013 is the aggregate of the deduction that
may be claimed undersections
80C, 80CCC and 80CCD.
2. The sums paid or deposited need not be out
of income chargeable to tax of the previous year. Amount may be paid or
deposited any time during the previous year, but the deduction shall be
available on so much of the aggregate of sums as do not exceed the total income
chargeable to tax during the previous year.
3. Life Insurance premium is part of gross qualifying amount
for the purpose of deduction under section
80C. Payment of premium which is in excess of 10 per cent (if policy is
issued on or after 1-4-2013, 15% in case of insurance on life of person with
disability referred to in section
80U or suffering from disease
or ailment specified in section
80DDB/rule
11DD) of actual capital sum assured shall not be included in gross
qualifying amount. The value of any premiums agreed to be returned or of any
benefit by way of bonus or otherwise, over and above the sum actually assured,
which is to be or may be received under the policy by any person, shall not be
taken into account for the purpose of calculating the actual capital sum
assured.
The limit of 10 per cent will be applicable only in the case of
policies issued on or after 1-4-2012. In respect of policies issued prior to
1-4-2012, the old limit of 20 per cent of actual sum assured will be
applicable.
With effect from 1-4-2013, 'actual capital sum assured' in
relation to a life insurance policy shall mean the minimum amount assured under
the policy on happening of the insured event at any time during the term of the
policy, not taking into account—
(i) the value of any
premium agreed to be returned; or
(ii) any benefit by way of bonus or
otherwise over and above the sum actually assured, which is to be or may be
received under the policy by any person.
4. Where, in any previous year, an assessee—
(i) terminates his
contract of insurance, by notice to that effect or where the contract ceases to
be in force by reason of failure to pay any premium, by not reviving contract
of insurance,—
(a) in case of any single premium
policy, within two years after the date of commencement of insurance; or
(b) in any other case, before
premiums have been paid for two years; or
(ii) terminates his participation
in any unit-linked insurance plan (ULIP), by notice to that effect or where he
ceases to participate by reason of failure to pay any contribution, by not
reviving his participation, before contributions in respect of such
participation have been paid for five years; or
(iii) transfers the house property
before the expiry of five years from the end of the financial year in which
possession of such property is obtained by him, or receives back, whether by
way of refund or otherwise, any sum specified in that clause,
then,—
(a) no deduction shall be allowed
to the assessee with reference to any of such sums, paid in such previous year;
and
(b) the aggregate amount of the
deductions of income so allowed in respect of the previous year or years
preceding such previous year, shall be deemed to be the income of the assessee
of such previous year and shall be liable to tax in the assessment year
relevant to such previous year.
If any equity shares or debentures, with reference to the cost of
which a deduction is allowed, are sold or otherwise transferred by the assessee
to any person at any time within a period of three years from the date of their
acquisition, the aggregate amount of the deductions of income so allowed in
respect of such equity shares or debentures in the previous year or years
preceding the previous year in which such sale or transfer has taken place
shall be deemed to be the income of the assessee of such previous year and
shall be liable to tax in the assessment year relevant to such previous year.
A person shall be treated as having acquired any shares or
debentures on the date on which his name is entered in relation to those shares
or debentures in the register of members or of debenture-holders, as the case
may be, of the public company.
5. If any amount, including interest accrued thereon,
is withdrawn by the assessee from his deposit account made under (a)
Senior Citizen Saving Scheme or (b) Post Office Time Deposit Rules,
before the expiry of the period of five years from the date of its deposit, the
amount so withdrawn shall be deemed to be the income of the assessee of the
previous year in which the amount is withdrawn and shall be liable to tax in
the assessment year relevant to such previous year.
The amount liable to tax shall not include the following amounts,
namely:—
(i) any amount of interest,
relating to deposits referred to above, which has been included in the total
income of the assessee of the previous year or years preceding such previous
year; and
(ii) any amount received by
the nominee or legal heir of the assessee, on the death of such assessee, other
than interest, if any, accrued thereon, which was not included in the total
income of the assessee for the previous year or years preceding such previous
year.
Section
|
Nature of deduction
|
Who can claim
|
(1)
|
(2)
|
(3)
|
Contributions to certain pension funds of LIC or any other
insurer (up to Rs. 1,00,000) (subject to certain conditions)15
|
Individual
|
|
Contribution to pension scheme notified by Central Government up
to 10% of salary (or w.e.f. assessment year 2015-16, Rs. 1,00,000, whichever
is less) (subject to certain conditions and limits)16
|
Individual
|
|
Amount up to Rs. 20,000, paid or deposited, during the previous
years relevant to assessment year 2011-12 or 2012-13, as subscription to
notified long-term infrastructure bonds
|
Individual/HUF
|
|
50 per cent of amount invested by specified resident individuals
in notified equity savings scheme17(subject
to certain conditions and limits) (maximum deduction : Rs. 25,000)
|
Specified resident individuals
(new retail investors)
|
|
Medical insurance premia paid by any mode other than cash to LIC
or any other insurer up to following limits (subject to certain conditions)
|
Individual/HUF
|
|
■ In case of individuals, premia paid
- for self, spouse and dependent
children : Rs. 15,000 (Rs. 20,000 if person insured is a senior citizen); and
- for parents of the assessee :
(Additional) Rs. 15,000 (Rs. 20,000 if person insured is a senior citizen)
■ In case of HUF, premia up to Rs. 15,000
(Rs. 20,000 if person insured is a senior citizen) paid to insure any member
of the family.18
|
||
Deduction of Rs. 50,000 (Rs. 1,00,000 in case of severe
disability) to a resident individual/HUF where (a) any expenditure has
been incurred for the medical treatment (including nursing), training and
rehabilitation of a dependant, being a person with disability [as defined
under Persons with Disabilities (Equal Opportunities, Protection of Rights
and Full Participation) Act, 1995] (w.e.f. assessment year 2005-06 including
autism, cerebral palsy and multiple disability as referred to in National
Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation
& Multiple Disabilities Act, 1999), or (b) any amount is paid or
deposited under an approved scheme framed in this behalf by the LIC or any
other insurer or the Administrator or the specified company [as referred to
in UTI (Transfer of Undertaking & Repeal) Act, 2002] for the maintenance
of a dependent, being a person with disability (subject to certain conditions)
|
Resident Individual/HUF
|
|
Expenses actually paid for medical treatment of specified
diseases and ailments subject to certain conditions19
|
Resident Individual/HUF
|
|
Amount paid out of income chargeable to tax by way of payment of
interest on loan taken from financial institution/approved charitable
institution for pursuing higher education20 (subject to certain conditions)
(maximum period : 8 years)
|
Individual
|
|
Interest payable on loan taken by him from any financial
institution for the purpose of acquisition of a residential house property
(Maximum deduction : Rs. 3,00,000)
|
Individual
|
|
Donations to certain approved funds, trusts, charitable
institutions/donations for renovation or repairs of notified temples, etc.
[amount of deduction is 50 per cent of net qualifying amount]. 100 per cent
of qualifying donations to National Defence Fund, Prime Minister's National
Relief Fund, Prime Minister's Armenia Earthquake Relief Fund, Africa (Public
Contributions - India) Fund, National Children's Fund (from 1-4-2014),
Government or approved association for promoting family planning,
universities and approved educational institutions of national eminence,
National Foundation for Communal Harmony, Chief Minister's Earthquake Relief
Fund (Maharashtra), Zila Saksharta Samitis, National or State Blood
Transfusion Council, Fund set up by State Government to provide medical
relief to the poor, Army Central Welfare Fund, Indian Naval Benevolent Fund
and Air Force Central Welfare Fund, Andhra Pradesh Chief Minister's Cyclone
Relief Fund, National Illness Assistance Fund, Chief Minister's Relief Fund
or the Lt. Governor's Relief Fund in respect of any State or Union Territory,
National Sports Fund, National Cultural Fund, Fund for Technology Development
and Application, Indian Olympic Association, etc.21,
fund set up by State Government of Gujarat exclusively for providing relief
to victims of earthquake in Gujarat, National Trust for Welfare of Persons
with Autism, Cerebral palsy, Mental retardation and Multiple Disabilities,
and sums paid between 26-1-2001 and 30-9-2001 to any eligible trust,
institution or fund for providing relief to Gujarat earthquake victims22 [subject to certain conditions and
limits]23
|
All assessees
|
|
Rent paid in excess of 10% of total income for
furnished/unfurnished resi-dential accommodation (subject to maximum of Rs.
2,000 p.m. or 25% of total income, whichever is less) (subject to certain
conditions)
|
Individuals not receiving any
house rent allowance
|
|
Certain donations for scientific, social or statistical research
or rural development programme or for carrying out an eligible project or
scheme or National Urban Poverty Eradication Fund (subject to certain
conditions)
|
All assessees not having any
income chargeable under the
head 'Profits and gains of business
or profession'
|
|
Sum contributed to any political party/electoral trust25
|
Indian company
|
|
Sum contributed to any political party/electoral trust25
|
All assessees, other than local
authority and artificial
juridical
person wholly or partly
funded
by Government
|
|
For certain incomes
|
||
Profits and gains from industrial undertakings engaged in
infrastructure facility, telecommunication services, industrial park, development
of Special Economic Zone, power undertakings, etc. (subject to certain
conditions and limits)26
|
All assessees
|
|
Profits and gains derived by undertaking/enterprise from
business of developing a Special Economic Zone notified on or after 1-4-2005
(subject to certain conditions and limits)
|
Assessee being Developer of SEZ
|
|
Profits and gains from industrial undertakings, cold storage
plant, hotel, scientific research & development, mineral oil concern,
housing projects, cold chain facility, multiplex theatres, convention
centres, ships, etc. (subject to certain conditions and limits)
|
All assessees
|
|
Profits and
gains derived by an undertaking or an enterprise in special category States
(Himachal Pradesh, Uttaranchal, Arunachal Pradesh, Assam, Manipur, Meghalaya,
Mizoram, Nagaland and Tripura) (subject to certain limits, time limits and
conditions),
(a) which has begun or begins to manufacture or
produce any article or thing, not being any article or thing specified in the
Thirteenth Schedule, or which manufactures or produces any article or thing,
not being any article or thing specified in the Thirteenth Schedule and
undertakes substantial expansion during the specified period.
(b) which has begun or begins to manufacture or
produce any article or thing specified in the Fourteenth Schedule or
commences any operation specified in that Schedule, or which manufactures or
produces any article or thing, specified in the Fourteenth Schedule or
commences any operation specified in that Schedule and undertakes substantial
expansion during the specified period
|
All assessees
|
|
Profits and gains from business of hotels and convention centres
in specified areas (subject to certain conditions).
|
All assessees
|
|
Deduction in respect of certain undertakings in North Eastern
States.
|
All assessees
|
|
Entire income from business of collecting and processing or treating
of bio-degradable waste for generating power, or producing bio-fertilizers,
bio-pesticides or other biological agents or for producing bio-gas, making
pellets or briquettes for fuel or organic manure (for 5 consecutive
assessment years)
|
All assessees
|
|
30 per cent of additional wages paid to new regular workmen
employed in the previous year for 3 assessment years including the assessment
year relevant to the previous year in which such employment is provided
(subject to certain conditions)
|
Indian company having profits
and gains derived from
manufacture of goods in a factory
|
|
Certain incomes of Scheduled banks/banks incorporated outside
|
Scheduled Banks/banks
incorporated outside
/Units of International Financial
Services Centre
|
|
Specified incomes [subject to varying limits specified in
sub-section (2)]
|
Co-operative societies
|
|
Royalty income of author of certain specified category of books
(up to Rs. 3,00,000) (subject to certain conditions)
|
Resident Individual - Author
|
|
Royalty on patents up to Rs. 3,00,000 in the case of a resident
individual who is a patentee and is in receipt of income by way of royalty in
respect of a patent registered on or after 1-4-2003 (subject to certain
conditions).
|
Resident individuals
|
|
Interest on deposits in savings bank accounts (up to Rs.
10,000 per year)
|
Individuals/HUFs
|
|
Deduction of Rs. 50,000 to a resident individual who, at any
time during the previous year, is certified by the medical authority to be a
person with disability [as defined under Persons with Disabilities (Equal
Opportunities, Protection of Rights and Full Participation) Act, 1995]
[w.e.f. assessment year 2005-06 including autism, cerebral palsy, and
multiple disabilities as defined under National Trust for Welfare of Persons
with Autism, Cerebral Palsy, Mental Retardation & Multiple Disabilities
Act, 1999] [in the case of a person with severe disability, allowable
deduction is Rs. 1,00,000] (subject to certain conditions).
|
Resident individuals
|
|
Rebates
|
||
Tax rebate in case of individual resident in
|
Individual
|
1.
Rs. 2,00,000 with effect from assessment year 2015-16.
2.
Provisions of section 32 shall apply whether or not the assessee has claimed
depreciation.
3.
The benefit of section 32AC has been extended by incorporating section 32AC(1A)
with effect from the assessment year 2015-16. Under section 32AC(1A),
investment allowance will be available if the aggregate amount of actual cost
of new plant and machinery acquired and installed by a manufacturing company
during any previous year exceeds Rs. 25 crore. The amount of investment
allowance will be 15 per cent of actual cost of new asset acquired and installed
during the previous year. This deduction will be available for the assessment
years 2015-16 to 2017-18. However, no deduction will be available for the
assessment year 2015-16 under section 32AC(1A) to a company which is eligible
for deduction under section 32AC(1).
4.
Deduction under section 35(2AB) shall be available in respect of expenditure
incurred upto 31-3-2017.
5.
With effect from assessment year 2015-16 business of laying and operating a
slurry pipeline for the transportation of iron ore and the business of setting
up and operating a notified semi-conductor wafer fabrication manufacturing
unit, have been included.
♦ Following amendments are also
made in section 35AD with effect from assessment year 2015-16 :
With a view
to ensure that the capital asset on which investment linked deduction has been
claimed is used for the purposes of the specified business, sub-section (7A)
has been inserted in section 35AD to provide that any asset in respect of which
a deduction is claimed and allowed under section 35AD, shall be used only for
the specified business for a period of 8 years beginning with the previous year
in which such asset is acquired or constructed. Moreover, if such asset is used
for any purpose other than the specified business, the total amount of
deduction so claimed and allowed in any previous year in respect of such asset
(as reduced by the amount of depreciation allowable in accordance with the
provisions of section 32 as if no deduction had been allowed under section
35AD), shall be deemed to be income of the assessee chargeable under the head
"Profits and gains of business or profession" of the previous year in
which the asset is so used. However, this provision will not apply to a company
which has become a sick industrial company under section 17(1) of the Sick
Industrial Companies (Special Provisions) Act within the time period of 8 years
as stated above.
♦ Where any deduction under section
35AD has been availed of by the assessee on account of capital expenditure
incurred for the purposes of specified business in any assessment year, no
deduction under section 10AA shall be available to the assessee in the same or
any other assessment year in respect of such specified business.
6.
With effect from assessment year 2015-16 a new Explanation 2 has been inserted in section 37(1)
to clarify that expenditure incurred by the assessee on Corporate Social
Responsibility activities in accordance with section 135 of the Companies Act,
2013 will not be considered as expenditure incurred by the assessee for the
purposes of the business or profession.
7.
Following chart explains amendments made in section 40(a)(i) with
effect from the assessment year 2015-16 :
TDS
default pertaining to any sum (other than salary) payable outside
|
Law
applicable up to the assessment year 2014-15
|
Law
applicable from the assessment year 2015-16
|
|
1. Tax is deductible but it is not
deducted
|
Expenditure
is not deductible. If, however,
TDS is deposited in a subsequent year, it
will
be deducted
in that year
|
No
amendment. The law which is applicable for the assessment year 2014-15 will
apply for assessment year 2015-16 onwards
|
|
2. Tax is deductible (and it is so
deducted during April 1 and February 28/29 of the financial year) but it is
not deposited up to March 31 of the financial year
|
Expenditure
is not deductible. If, however,
TDS is deposited in a subsequent year, it
will
be deducted
in that year
|
Disallowance
provisions will not be applicable if TDS is deposited up to the due date of
submission of return of income under section 139(1). If TDS is deposited
after this date, expenditure will be deductible in the year in which TDS is
deposited.
|
|
3. Tax is deductible (and it is so
deducted during the month of March) but it is not deposited up to April 30
falling immediately after the end of the financial year
|
Expenditure
is not deductible. If,
however,
TDS is deposited in a subsequent
year, it will be deducted in that year
|
Disallowance
provisions will not be applicable if TDS is deposited up to the due date of
submission of return of income under section 139(1). If TDS is deposited
after this date, expenditure will be deductible in the year in which TDS is
deposited.
|
8.
Following amendments have been made in section 40(a)(ia) with
effect from the assessment year 2015-16 :
• Coverage
of disallowance extended - Before
amendment, disallowance provisions of section 40(a)(ia), covered
TDS default under sections 193, 194A, 194C, 194D, 194H, 194-I and 194J. After
amendment, disallowance under section 40(a)(ia), will cover any amount payable to a resident
which is subject to TDS.
• Only
30 per cent expenditure to be disallowed - In
case of TDS default, 30 per cent of expenditure (not 100 per cent) will be
disallowed.
10.
With effect from assessment year 2015-16 limit of Rs. 50 lakhs applies to total
amount invested during financial year in which original asset is transferred
and in subsequent financial year.
13. Rs. 1,50,000, with effect from assessment year
2015-16.
14. Where deduction is claimed under this section,
deduction in relation to same amount cannot be claimed under section 80C.
15.
Section 80CCE provides that the aggregate
amount of deductions under section 80C, section 80CCC and section 80CCD shall
not, in any case, exceed one lakh rupees. (Rs. 1,50,000 w.e.f. assessment year
2015-16)
With effect
from assessment year 2015-16, amended sub-section (1) has clarified that a
non-government employee can claim deduction under section 80CCD even if his
date of joining is prior to January 1, 2004.
16.
With effect from the assessment year
2012-13 section 80CCE is amended so as to provide that contribution made by the
Central Government or any other employer to a pension scheme under sub-section
(2) of section 80CCD shall not be included in the limit of deduction of one
lakh rupees (Rs. 1,50,000 w.e.f. assessment year 2015-16) provided under
section 80CCE.
Following
table demonstrates maximum deduction available in sections 80C, 80CCC and 80CCD
with effect from assessment year 2015-16.
From
the assessment year 2015-16
|
|||
Section
|
Maximum
deduction under relevant section
|
Cumulative
maximum deduction [Sec. 80CCE
|
|
Section 80C
|
Rs.
1,50,000
|
Rs.
1,50,000
|
|
Section
80CCC
|
Rs.
1,00,000
|
||
Section
80CCD(1) (i.e., employee's contribution or assessee's contribution
towards NPS)
|
10% of "salary"
[for a self-employed person : 10% of GTI] or Rs. 1,00,000, whichever is less
|
||
Section
80CCD(2) (i.e., employer's contribution towards NPS)
|
10% of
salary
|
Not
applicable
|
|
17. Rajiv Gandhi Equity Savings Scheme, 2012/2013.
With effect
from assessment year 2014-15 (a) investment in listed units of an equity
oriented fund is also permitted; (b) deduction shall be allowed for
three consecutive assessment years, beginning with the assessment year relevant
to previous year in which the listed equity shares or listed units of equity
oriented fund were first acquired and (c) gross total income of the
assessee for relevant assessment year shall not exceed twelve lakh rupees.
18. With effect from 1-4-2013 (a) deduction is
available in respect of any payment made by an assessee on account of
preventive health check-up of self, spouse, dependent children or parent during
the previous year upto a limit of five thousand rupees within the existing
limits prescribed above; (b) the age for defining a senior citizen is
reduced from sixty five years to sixty and (c) cash may be paid on
account of preventive health check up.
With effect
from 1-4-2014, deduction shall also be allowed in respect of any payment or
contribution made by assessee to any other health scheme (other than CGHS) as
may be notified by the Central Government [Contributory Health Service Scheme
of the Department of Space].
19. Maximum deduction allowable is Rs. 40,000 (Rs.
60,000 where expenditure is incurred on a senior citizen).
With effect
from 1-4-2013 the age for defining a senior citizen is reduced from sixty five
years to sixty years.
20. Scope of 'higher education' is enlarged with effect
from assessment year 2010-11 to cover any course of study pursued after passing
the Senior Secondary Examination or its equivalent from any school, Board or
university recognised by the Central Government or State Government or local authority
or by any other authority authorized by the Central Government or State
Government or local authority to do so.
With effect
from 1-4-2010 the scope of expression 'relative' has also been enlarged to
cover the student for whom the taxpayer is the legal guardian.
21. Donation of any sums paid by the assessee, being a
company, in the previous year as donations to the Indian Olympic Association or
to any other association or institution established in India , as the
Central Government may, having regard to the prescribed guidelines, by
notification in the Official Gazette, specify in this behalf for—
(i) the development of infrastructure
for sports and games; or
(ii) the sponsorship of sports and games,
in India ;
is eligible
for the purpose of deduction under section 80G [this is in consequence of
omission of section 10(23)].
22. Donation made to an authority constituted in India
by or under any law enacted either for the purpose of dealing with and
satisfying the need for housing accommodation or for the purpose of planning,
development or improvement of cities, towns and villages, or for both is also
eligible for the purpose of deduction under section 80G from the assessment
year 2003-04 [this is in consequence of omission of section 10(20A)].
23. With effect from 1-4-2013 no deduction shall be
allowed in respect of donation of any sum exceeding ten thousand rupees unless
such sum is paid by any mode other than cash.
24.
With effect from 1-4-2013 no deduction
shall be allowed under this section in respect of any sum exceeding ten
thousand rupees unless such sum is paid by any mode other than cash.
25. With effect from 1-4-2014 deduction will not be
allowed if sum is contributed in cash.
26. Time limits stated under section 80-IA(4)(iv)
have been extended from 31-3-2014 to 31-3-2017.
[As
amended by Finance (No. 2) Act, 2014]
