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Showing posts with label Tax Section 80U Have raised in budget 2015. Show all posts
Showing posts with label Tax Section 80U Have raised in budget 2015. Show all posts

Thursday 4 June 2015

Prepare at a time 50 employees TDS on Salary forFinancial Year 2015-16 and Assessment Year 2016-17. [This Excel Utility can prepare at a time 50 employees Tax Compute Sheet with the all amended Section of Income Tax as per the Finance Budget 2015-16]Download 

Allowances Exempted Under Section 10 of Income Tax Act

1. House Rent Allowance (HRA)

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 exempt the rent from income tax. However, your employer must pay the  house rent allowance.
Exemption of HRA is a  minimum of these three.  
a.                            Actual HRA received.  
b.                            Rent paid less 10% of salary.  
c.                            40% of Salary (50% in case of Mumbai, Chennai, Kolkata, Delhi). In this case, salary is basic plus dearness allowance (basic+DA).

          Click here to downloadAutomatic HRA Calculator

Leave Travel Allowance

LTC or LTA is exempted if the same is actually spent

Transport Allowance

You daily go to your office or workplace from you 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 Rs 1600/month, and Phy.disable person Rs. 3200/- P.M.

Children Education Allowance

Children Education allowance in 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.

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  home loan for the house, the interest payment is  tax exempted. You can get maximum exemption of  Rs 2 lakh on  housing loan interest U/s 24B.  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.

Tax Deduction 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. 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.

Deductions Under Chapter VIA of Income Tax Act

Section 80CCG: Rajiv Gandhi Equity Saving Scheme (RGESS)

This scheme also gives you the extra tax saving. To avail this benefit, you must be the first-time investor in the share market. Your annual income should not be more than Rs 10 lakh. You can invest up to Rs 50,000 under this scheme. However, the tax deduction would be available for the 50% of your investment. So, if you invest Rs 50,000, you will get the tax deduction of only Rs 25,000. There is some mutual fund scheme which is designed for RGESS. However, due to the complex rules,  it could not become popular.

Section 80D:  Medical Insurance Deduction

One must use this tax saving opportunity. In the budget 2015 the government does not change income tax slab, but it has increased the limit for section 80D.Section 80D can give you a tax deduction of up to Rs 55,000/- [ for below 60 years Rs. 25,000/- and above 60 years Rs.30,000/- ( Total Rs. 55,000/-)]. Medical insurance of self, family and parents are eligible for tax deduction under section 80D.

Section 80DD: Deduction For Maintenance of Disable Dependent

Under this section, one can get 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 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 80,000 under this section.
1.                              The deduction is for the expense of illness of self or dependent.
2.                              The illness should be within the prescribed list.
3.                              There should be 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 the specified rules. Max Limit Rs. 24,000/- P.A.

Section 80TTA: Saving Account Interest Deduction

Interest earned on a saving account is not added in taxable income, if it is less than Rs 10,000 in a financial year.

Section 80U: Deduction For Disabled

Under section 80U a person with disability gets 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.

Section 87A: Tax Rebate Rs.2,000/- who’s taxable income less than 5 Lakh.

Friday 27 March 2015

No changes the income tax rates or increasing the exemption limits for individuals, Union finance minister Mr. Arun Jaitley on Saturday proposed increasing the range of tax deductible investments/spend.
Presenting the budget proposals for 2015-16 in the Lok Sabha, Mr.Jaitley said the government is proposing to rationalise various tax exemptions and incentives to reduce tax disputes and improve tax administration.
The proposals mentioned by the finance minister made clear the government's focus on enlarging the tax-exempt investments/spend.
Mr.Jaitley said the proposals would result in tax deductions to the tune of around Rs 440,000 crore.
Mr.Jaitley said in order to encourage savings and to promote health care among individual tax payers, it is proposed to increase the limit of deduction on account of health insurance premium from Rs.15,000 to Rs.25,000 - for senior citizens this limit is to be increased from Rs.20,000 to Rs.30,000.
For senior citizens above the age of 80 years - who are not eligible to avail of health insurance - deduction will be allowed for medical expenses up to Rs 30,000.
The deduction limit of Rs 60,000 on expenditure on account of specified diseases -- like cancer -- will be enhanced to Rs 80,000 in the case of senior citizens.
TheTax Section 80U have raised up to Rs. 75,000/-  for differently-abled persons, increasing the limit from Rs 50,000 to Rs 75,000.
It is also  increase the limit of tax deduction from Rs 1 lakh to Rs 1.25 lakh in case of severe disability.
According to Jaitley, investment in Sukanya Samriddhi Scheme will be eligible for deduction under section 80C of the income tax and any payment from the scheme shall not be liable to tax.
Limit on deduction on account of contribution to a pension fund and the new pension scheme is  increased from Rs 1 lakh to Rs 1.5 lakh. Additional deduction of Rs 50,000 will be allowed for contribution to the new pension scheme under section 80 CCD of Income Tax Act -- increasing the exemption from Rs 1 lakh to Rs 1.5 lakh.
Mr.Jaitley also doubled the transport allowance exemption to Rs 1,600 per month.
According to him, the details of tax deductions proposed are as follows:

Deduction u/s 80C - Rs.150,000; Deduction u/s 80CCD - Rs.50,000; Deduction on account of interest on house property loan (Self-occupied property) - Rs.200,000; 
Deduction u/s 80D on health insurance premium - Rs.25,000; Exemption of transport allowance - Rs 19,200/-