Budget 2015 has been introduced in Parliament. The Finance Minister has kept the Personal Income Tax rates unchanged for the Financial Year 2015 /2016 (Assessment Year 2016-2017).
He has proposed to introduce or extend the Tax Deduction limits Under few Sections of the Income Tax Act.
Let us understand all the important sections and new proposals with respect to ‘Income Tax Deductions 2015’. This list will help you in planning your taxes.
Income Tax Deductions 2015
Section 80c
The maximum tax exemption limit under Section 80C has been retained as Rs 1.5 Lakh only. The various investment avenues under this section are;
- PPF (Public Provident Fund)
- EPF (Employees’ Provident Fund)
- Five year Bank or Post office Tax saving Deposits
- NSC (National Savings Certificates)
- ELSS Mutual Funds (Equity Linked Savings Schemes)
- Kid’s Tuition Fees
- SCSS (Post office Senior Citizen Savings Scheme)
- Principal repayment of Home Loan
- NPS (National Pension System)
- Life Insurance Premium
- Sukanya Samriddhi Account Deposit Scheme
Section 80CCC
Contribution to annuity plan of LIC (Life Insurance Corporation of India) or any other Life Insurance Company for receiving pension from the fund is considered for tax benefit. The maximum allowable Tax deduction under this section is Rs 1.5 Lakh.
Section 80CCD
Employee can contribute to Government notified Pension Schemes (like National Pension Scheme – NPS). The contributions can be upto 10% of the salary (or) Gross Income and Rs 50,000 additional tax benefit u/s 80CCD (1b) is proposed in Budget 2015. In FY 2014-2015, the maximum tax exemption allowed under Section 80CCD is Rs 1 Lakh only. In Financial Year 2015-2016 or Assessment Year (2016-2017), this will be Rs 1.5 Lakh (u/s 80 CCD 1 ) and additional exemption of Rs 50,000 u/s 80CCD (1b) will be allowed. ( To claim this deduction, the employee has to contribute to Govt recognized Pension schemes like NPS)
(10% of salary is applicable for salaried individuals and Gross income is applicable for non-slaried. The definition of Salary is only ‘Dearness Allowance.’ If your employer also contributes to Pension Scheme, the whole contribution amount (10% of salary) can be claimed as tax deduction under Section 80CCD (2). The ceiling limit of 1.5 Lakh u/s 80CCD is not applicable on employer’s contribution.)
Section 80D
Deduction u/s 80D on health insurance premium will be Rs 25,000, increased from Rs 15000. For Senior Citizens it has been increased to Rs 30,000 from the existing Rs 20,000. For very senior citizen above the age of 80 years who are not eligible to take health insurance, deduction is allowed for Rs 30,000 toward medical expenditure.
Section 80DD
You can claim up to Rs 75,000 (increased from the existing Rs 50,000) for spending on medical treatments of your dependents (spouse, parents, kids or siblings) who have 40% disability. It is also been proposed to increase the limit of deduction from Rs 1 lakh to Rs 1.25 lakh in case of severe disability.
Section 80DDB
An individual (less than 60 years of age) can claim upto Rs 40,000 for the treatment of specified critical ailments. This can also be claimed on behalf of the dependents. The tax deduction limit under this section for Senior Citizens is proposed as Rs 60,000 and for very Senior Citizens (above 80 years) the limit is Rs 80,000
Section 24 (B)
You can claim upto Rs 2 Lakh as tax deduction on the home loan interest payment. If your property is a let-out one then the entire interest amount can be claimed as tax deduction.
Section 80U
This is similar to Section 80DD. (Tax deduction is allowed for the tax assessee who physically and mentally challenged)
The other sections are – Section 80E (tax deduction benefit on the interest payment of an education loan), Section 80 G (Donations), Section 80GG (when HRA is not paid by the company but you incur rental expenses) and 100% TAX DEDUCTION on contributions made to SWACHH BHARAT & CLEAN GANGA initiatives have also been proposed.
It is prudent to plan your taxes from April 2015 itself, instead of waiting until late December 2015 (or) January 2016. I believe that the above list is useful for your Tax Planning purpose.
The above ‘Income Tax Deductions 2015’ are applicable for Financial year 2015-2016 (or Assessment Year 2016-2017).
(Image courtesy of Stuart Miles at FreeDigitalPhotos.net)
( You may like reading my articles on “Budget 2015 – Highlights” & “Income Tax slabs & rates FY 2015-2016“)
Income Tax Helpline – Customer Care Toll Free Numbers
Income Tax Department’s New Website
Got a Gift? Find out, if it is Taxable or Tax-free?
How to save Capital Gains Tax on Sale of Land / House Property?
what is the limit for tax deduction. my gross salary is 252000 pa. pls clarify me.
Dear Ashams,
Kindly read:
List of tax deductions for AY 2017-18.
Income tax rates for AY 2017-18.
For claiming LTA exemption of Rs. 29710/- in 2015, which ITR can be filled.
Dear Sanjay ..If you have submitted the necessary proofs, your employer would have already accounted for it in Form 16.
If not submitted, kindly note that you can not claim now when filing ITR (AY 2016-17).
Kindly read: IT declaration & investment proofs.
Hi,
I’ve downloaded ITR-4 and 2 utilities but upon opening the utility, it displays a completely blank utility, the header tabs like new, open, save, save draft, etc are shown though. If my extraction path would have been wrong then we couldn’t view the utility environment either! So i deleted the whole zip folder and downloaded the utilities again. But the problem is still the same. Pls let me know what’s my mistake and is anybody else facing the same issue?
Thanks
Mamata
Dear Mamata,
Just now I have downloaded the ITR 4 Excel Utility and it looks fine.
So, mostly the issue can be with your MS Excel software. Kindly try downloading it on other system.
Try “Extract all” from right click options, it usually works.
MY SALARY IS 2,40,000 PER ANNUM + I EARN AROUND 50,000 from interest on savings per annum…
i have invested 1lakh in PPF AND 10,000 IN lic IN THIS YEAR 2015-16… HOW MUCH TAX I HAVE TO PAY.
MY AGE IS 43
Dear KESHAVA ..Kindly use this calculator, click here..
HI,
I am going to buy flat.
I have paid stamp duty and registration challan on 30 march 2016 and we did registration process on 2 April 2016.
so can i use it for the year 2016-2017 declaration of tax or now i have to fill it for last year 2015-2016 TDS, retrun .
Dear Trikesh,
Very tricky question 🙂
Kindly go through the below points, can be useful;
* Deductions can only be claimed in the year of actual payment. Suppose you bought house and paid Stamp Duty and Registration Charges in December 2014, than you can claim deduction for these expenses u/s 80C in the financial year 2014-15 only. Expense for earlier year cannot be claimed.
* Deductions can only be claim, if expenses are for new residential house property for self and not for a resold property.
* For claiming deduction, you must possess the house also i.e. Payment for under-construction is not allowed. In simple words both payment of expenses and possession of the house must be in the same fiscal year for claiming expenses.
this is really nice
You have mentioned that under 80C an a deduction of 1,50,000 is available if invested under SCSS (Post office Senior Citizen Savings Scheme). In Oct 15 I have invested more than this amount under SBI Senior Citizen Saving Scheme. Is this scheme the same as SCSS (Post office Senior Citizen Savings Scheme)SCSS (Post office Senior Citizen Savings Scheme) and would a deduction be available under 80C. I invested this amount out of maturity amount of SBI FDs.
Let me mention that you are doing a wonderful job in clarifying he confusion in IT rules.
Dear Mr Kumar ..Yes, its the same. The amount deposited in SCSS is also allowed to be claimed as a deduction under Section 80C. You may check with the SBI too.
Hi,
I’m working in an IT company. Currently I’m saving Rs.150,000 under 80C and just to save more, I’ve opened NPS account last year. But now I’m thinking to close this account. Would it be right? And if so, is there any other savings options? I don’t have any house loan or don’t want to save under health insurance.
Would be great if you can suggest some better option.
Thanks,
Jhumu Sarker
Dear Jhumu,
Having a good Health cover is a must.
Why do you want to close NPS a/c? Would like to know your views.
Read : List of best investment options.
Hi, I would like to know that can employer deduct the amount u/s 80U from employees income or not?
Thanks.
Dear Shivaji,
To avail a deduction under Section 80U, no bills or receipts are required. What is required is a valid certificate from a medical authority certifying the disability.
Sir,
Can you clarify the following my doubts?
1-How much house rent is accepted by the IT Dept?
My gross salary in 2015-2016 Rs.4,26,000.00
Add bonus 2015-2016 Rs. 30,000.00
So the total income in the AY Rs.4,56,000.00
Exemption Rs.2,50,000.00
So i have to submit exemption expenses like House rent,Tuition fees,LIC and Shriram life insurance Premium and how much house rent eligible to show in IT?Actually i am paying per month HR is Rs.4,000/- and for the above year for Rs.48,000/- can we show in HR A/c?
Pl clarify.
Thank you,
Nataraja.R.N.
Dear NATARAJA,
There is no limit to show the rent paid as such, but the exemption on HRA is subject to certain conditions as below;
To The Extent Of The Minimum Of The Following Three Amounts :
1) Actual House Rent Allowance Received By The Employee
2) Excess Of Rent Paid For The Accommodation Occupied By Him Over 10 % Of The Salary.
3) 50% Of Salary Where The Residential House Is Situated At Mumbai, Calcutta, Delhi Or Chennai And 40% Of The Salary Where The House Is Situated At Any Other Place.
Hi,
I have a fiber optic cable internet connection (Broadband), this connection is with out a telephone number, there is only customer number. My employer is not accepting the bills as the broad band connection does not have a telephone number. Can you please through some light on this as there are many who have such issue and there is no information on the web. I want to save some money and dont want tax to be computed on the allowance that i get from the company.
Regards
Kumar
Dear Kumar,
If your office duty require mobile / telephone / internet connection, you can claim 100% exemption against billed amount by producing actual bills.
Hi Sreekanth
I m a state govt. Employee of TN govt. and come under CPF. My share under 80CCD 1 doesn’t exceed 1.5 lakhs. I want to know whether I can claim 2lakhs deduction under 80C and 80CCD put together. I don’t have any savings in 80CCD 1b in any NPS schemes approved by the central govt. other than CPF.
Dear Yogameenakshi,
The maximum amount that one can claim under section 80c+80ccd (1) is Rs 1.5 Lakh only.
Hi,
I have one query which I could not get cleared even searching it on internet. It is , I am a govt. employee and come under NPS system I want to know wether the income tax exemption under 80C ( Rs. 150,000) includes the exemption to employer’s contribution (80CCD 2) or the exemption to employer’s contribution is above the exemption granted under 80C (Rs. 150,000) as I have seen our bill clerk including the employer’s contribution into the gross salary and then deducting Rs.150,000 under Sec. 80 C. I will be very thankful if you will clear this doubt to me.
Thanks
Dear Mr Bhat,
If your employer also contributes to Pension Scheme, the whole contribution amount (10% of salary) can be claimed as tax deduction under Section 80CCD (2). The ceiling limit of 1.5 Lakh u/s 80CCD is not applicable on employer’s contribution.
Hi Sreekanth
First of all – Thank You So Much from my end as i just saw your responses above to help people and
give advice regarding tex related queries.
Sir..I also have a query which nobody could give clear answer.I have tried to search regarding my
query on internet but no proper solution is there,,So now after searching on net i landed here and
hope that you will have a proper and accurate answer to my query.
My query is that – I am going to buy a 4 years old house.On 22nd february 2016 i am going to tehsil
for registration and to pay stamp duty and mutation as well for the same.This is not an authorized property.
Rather this was a free-hold plot in which a house was constructed and now we are buying it.Let me tell you
that i am also taking loan of 20 lack for this house.
SO MR. SREEKANTH …I WANT TO ENQUIRE WHETHER I CAN GET EXEMPTION FROM MY TAX
FOR THE YEAR 2015-2016 IF I SUBMIT MY REGISTERY+STAMP DUTY+MUTATION DOCUMENT….?????????????????????
THE AMOUNT WHICH I HAVE TO PAY IN REGISTERY + STAMP DUTY + MUTATION = 1,45,000
ALSO MY CTC YEARLY IS = 5,38,000
I will eagerly be waiting for your detailed reply
Thanks & Regards
Vikas Barthwal
Dear Vikas,
Kindly let me know what type of Loan are you taking?
Mutation Fees is part of the cost of house property and as such is eligible for deduction under sec 80c, besides the Registration & Stamp duty costs.
I had applied for home loan and day before yesterday( 18th february 2016 ) i got intimation
from bank that your loan has been disbursed.I just wanted to know if i will get exemption on
registery(20500) + Stamp duty ( 125000) on this 4 years old house which was built by owner
on a free hold land.
Hello,
My two sons Tuition fee Rs: 2,50,00/= . Is it possible to deduct this amount in 80C. My spouse is also working. please tell me how to deduct this tuition fee amount.
Regards,
Sivakumar.v
Dear Sivakumar,
A tax assessee can claim max up to Rs 1.5 Lakh as tuition fee u/s 80c. I am sure you may have other investments to be claimed as tax deduction u/s 80c.
So, suggest both of you to divide this amount and claim accordingly.
sir, I am tamilnadu govt. employee and i am in cps. So 10% of amount is detected towards CPS from basic pay. the samount is given by the govt as per NSC . My qns.are
1. am in New Pension Scheme?
2. Can I avail Rs.50000 in 80ccd-2?
Dear Ela..You can claim rs 50k over and above your Rs 1.5 limit (NPS + Section 80c put together).
Dear sir ; I have taken car loan amont 6 lac 31.12.2015 is that any tax binifit for that ? I have properitership firm pls tell me
Thanks & Regards
Praveen Boswell
Greater noida
Dear Praveen,
Deductions from payable tax through a car loan can be availed only if you are a business man and declare the profit or capital gains earned from your business. Another condition attached to this is that the vehicle has to be purchased in the name of your business. In that case, you get exemption on the interest as well as depreciation of the vehicle. Under these conditions, you can include the interest paid for your car loan for tax exemption.
I am proprietor for small company, advice which is best for tax exemption plans.
Dear Uttam..Kindly share more details about your financial goal(s).
Kindly read:
Best ELSS tax saving mutual funds.
Hi Sreekanth,
I am investing Rs 1000/- in Systematic Investment Plan in “RELIANCE GROWTH FUND – GROWTH PLAN GROWTH OPTION” for past 7 yrs or so. When I took this SIP, my agent told me that it was not tax saving plan but only a kind of investment for me. Few days back, someone told me that if I invest in any SIP for more than 3yrs continuously then this SIP investment can be treated TAX exempted for me. Please advise !!
Dear Nishant,
Kindly understand the difference between TAX SAVING & TAX EXEMPTION.
Any capital gains on redemptions of Equity mutual funds after 1 year of holding the units are exempted from income taxes.
If you invest in Tax saving mutual funds (ELSS funds) which have a lock-in period of 3 years, you can claim the invested amount as tax deduction u/s 80c (tax saving). If you redeem these units after 3 years then any gain made on such redemptions is tax exempted.
Thanks for the reply Sreekanth!
In my SIP case as mentioned above,
Can you please tell me if I can show total 12k (Rs1000*12 months= Rs. 12000/ PA) as my investment and show under 80C to get some tax benefits when submitting my tax declaration every year then?
Dear Nishant,
Kindly note that Reliance Growth fund is not an ELSS tax saving mutual fund.
Kindly read:
Best Tax saving mutual funds 2016 (ELSS funds).
Hi Sreekanth,
I have a question about regarding tax calculation on medical allowance(Rs. 15000 paid by employer) if I don’t fall under tax bracket( income < 2.5L) and if no bills are submitted to employer. Will TDS be deducted on medical allowance, 30% of 15k.?
Thank you – Nikhil
Dear Nikhil..Yes, TDS is applicable.
l have spend 20000 rs for my wife’s delivery treatment .
can l get tax benefit for it.
Dear sanjiv..You can claim medical reimbursement by submitting bills up to Rs 15,000 (Medical Allowance u/s 10).
Dear Sir,
My husband is a Govt. Servant(W.B.) and he has been taken an amount of Rs.2(two) lac as Xpress Credit Loan from S.B.I. for repairing and renovation of his own house on June,2013 after intimating to his D.D.O. in written.
Now my question is it (i.e. principal @ Intt.) may be deducted/relief from his income in respect of Income Tax or not? Also mention rule/sec. no. please.
If answer is yes then how the previous amount ( for the F.Y. 13-14,14-15) will be adjusted from his Income Tax Return.
For your co-operation, I ever grateful to you.
Thanking you.
Dear Mrs S.Bhattacharjee,
SBI’s Express Credit Loan is a Personal Loan.
If a house property is acquired, renewed, repaired or reconstructed using the personal loan the interest amount up to Rs 2 lakh can be claimed for self-occupied properties as per Section 24 (B). However, there are no tax benefit for Principal repayments and also you can claim previous years tax benefits in your case.
Kindly preserve the bills (repairs/renovation) to prove that you have used the loan amount for these purposes.
I have paid LIC 1st premium of Rs.2.00 lakhs in December 2015 towards Life Insurance and next due is December 2016 and it will continue like this for another 5 years. Can I get tax benefit for the whole amount of Rs.2.00 lakhs for financial year 2015-16 because the 1st premium is paid in December 2015 (yearly). Please clarify because we are already in the verge of January 2016. Please clarify.
Dear NARASIMHA..The maximum amount you can claim is Rs 1.5 Lakh u/s 80c.
Let me know the plan name??
I want to know House Repairing Loan’s Interest deduction from Gross Income. Yes or No. Please answer or Rules for it.
Dear NIRANJAN..You can claim only Rs.30,000 tax deduction if home loan is for house renovation/repairs.
(Tax benefit on interest paid can be availed for loans taken for repair of the house too but tax benefit, in such a case, shall be limited to Rs 30,000 per financial year.)
Sir i am the state govt employee of Andra pradesh.My doubt is my contribution 10% of salary is comes under 80CCD(1B) or 80C or Both.
please reply
Dear Kiran,
I believe that it comes under Section 80ccd (1) (NPS contributions).
Hi, I would like to know the new procedure to declare the children tuition fees for tax exemption. I am told that we can’t submit the proof before submitting the return. We should declare the Tuition fee in our annual return, then claim for tax benefit. Is that correct? Thanks.
Dear Venkatesh..I am not aware of any such rule as of now.
Please leave your number for the further details
nice chat
TO CLAIM EXEMPTION IN INCOME TAX WHETHER TRANSPORT ALLOWANCE ALONE IS TAKEN OR THE TRANSPORT ALLOWANCE ALONGWITH DA ADDED THERE ON AS PER 6TH CPC. PLEASE CLARIFY.
Dear NIRMALA,
To claim TA, I believe that DA or any other allowances of Salary is included along with it.
dear sir, i”m employee in private sector age 30. my annual ctc 610 k. i need to know 1) taxable amount, 2)% of tax on my taxable amount. please suggest better savings plan.
Dear shravan,
Suggest you to download any income tax calculator for FY 2015-16 and you may calculate the tax liability for yourself.
Regarding investment avenues; Kindly let me know about your financial goals, current investments (if any),dependents’ details??
Dear Sir,
MY Annual gross salary is Rs.16,01,750/- , I have U/s 80C-Rs.1,50,000/-. (EPF,LIC, Children school fee), Other than, I don’t have any savings/deposits. Please suggest various saving schemes for tax deduction FY2015-16(AY2016-17) under various sections for maximum tax deduction.
Awaiting ur reply.
Regards.
Sairaj
Dear Sir,
My uncle’s annual salary falls in the 30% slab (His salary is Rs. 14,50,000). He has invested in the investments u/s 80c and fully availed the benefits of this section. His employers deduct T.D.S. from his salary. He wants to save more tax.
Kindly suggest me which more investments can he do to save the tax or suggest me any other way to save the income tax.
Thanks and Regards,
Chander Mittal
98157-37012
Dear Sir,
Please let me know :-
1.Whether RGESS is still available to Tax Payers for investments in 2015-16 so as to avail deductions.
2.What amount connected to Housing Loans is available for deductions under different heads??
Regards
Surya
can i know weather in the financial year 2015-2016. can i take benifit of 80CCG RGESS.
Dear Ritesh..I believe that it is available.
I have joint housing loan wth my spouse , can we both avail the tax benefits on housing loan
Dear Jai..Kindly read my article on ‘Joint home loan & Income Tax implications‘.
Dear Sir,
I am working with private limited manufacturing company on agreement for marketing consultant. TDS at current rate is deducted by my employer at source.
As such I have no other allowances or income from said employer and I need to cover myself for Insurance as well payments for rented house for me and my spouse with various other deposits/savings allowed under I/T in India from my earlier employment.
You are requested to suggest or guide me suitably, under which schemes and savings, I can claim refunds of TDS made by my current employer at source to enable to get refund from Income tax departments after filing returns with allowable deductions.
Your valued suggestions and guidelines are solicited and shall be highly appreciated.
Thanks & Best Regards
Dilip Shirst
Dear Dilip,
Kindly take term insurance if you do have one. You can claim tax benefits on the premium paid under Section 80c.
You can take health insurance for self and spouse and claim tax benefits u/s 80d.
Start investing in ELSS funds towards your Retirement Goal. These investments can be claimed u/s 80c.
Kindly read my articles;
Top Term insurance plans
Top ELSS funds
Health insurance & Section 80D
Retirement planning.
Dear sir
i am central govt. employee. last yr i made Rs. 150000/-(75000 NPS+50000 LIC+25000 PPF) deductions. This yr how much can i make deductions. Whether Rs. 50000/-deductions declared under NPS is extra from Rs. 150000/-
regards
pradip
Dear Pradip,
Yes it is over and above the Rs1.5 L aggregate limit.
Kindly share your LIC plan names.
Dear Sir,
MY Annual gross salary is Rs.4,50,000/-
I hv doubt that my taxable income comes around 1,96,000/- whether I can claim all amount.
Some of my friends said I can claim only upto rs.1.5 lakhs more than that I need to pay tax of 10%.
pls guide me in this whether I can claim full amount or not.
Awaiting ur reply.
Regards.
Niranjan
Dear Niranjan,
Tax deductions up to Rs 1.5Lakh are available under section 80c.
As listed in the article, there are other sections also under which you can claim some more tax exemptions.
I received an interest of Rs. 1,09,116.00 from post office SCSS during FY 2014-2015 after a deduction of Rs. 320.00. As per income tax site of 26AS, it is not reflected. Is this entire amount is taxable?. How much tax I should deposit for my savings bank interest of Rs. of Rs. 1,46,894.00? Further, I received an amount of Rs.69,775.00 from pensions of two nos. LIC. I think it will not attract any income tax as fallen below of Rs. 1,00,000.00.
Please comment on above to ease my income tax calculation.
Dear JOYDEV,
TDS has to be applied if the interest paid or payable exceeds Rs 5,000 during the financial year.
Also, the entire interest earned is taxable. Pension is liable to taxes.
Kindly add these incomes in your ITR and pay taxes accordingly.
Hi Srikanth,
I am a IT employee and as per the recent checking i feel my gratuity is deducted more than it should be. Can you please let me know actual gratuity percentage that should be deducted from ones salary who is into CTC mode.
Regards
Siddharth
Dear Siddharth,
Kindly go through my article : Gratuity & Tax Implications and revert to me.
You may also contact your employer about this and get clarification. They might have changed the contribution amount.
Hi
I am a govt employee with an gross total income of 10.9 lakhs. I wanted to know if the transport allowance provided to me monthly is taxable and if taxed can we reduce it from the taxable income while filing returns. What are the other such allowances which can be claimed while filing the returns?
Dear AJ,
The tax exemption on transport allowance is Rs 1600 pm which you can reduce from your Gross income and show it in ITR.
It depends on your payslip / salary structure. (House Rent Allowance is another such example).
Thank you for the prompt reply. Could you also tell me as to what is amount per month exempt-able for TA/DA for Govt employees while filing IT returns?
Dear AJ..DA is taxable. Transport allowance is exempted up to Rs1,600 pm .
Hi,
I dont see the section “Deductions u/s 24 – Interest” to claim exemption on Interest on housing loan in ITR1.
Can you suggest what Im supposed to do ?
Note: I only see ITR1 & ITR(sahaj) in the list of ITR’s.
Appreciate if you could guide me as to how I can claim this.
Regards
Guru
Dear Gurunath,
You have to calculate your income from property and show it under section ‘income from one house property’ of ITR1.
Hi,
I think Gurunath is asking about the exemption that can be claimed under section 24.
Even I am not sure where to fill the interest part of my Housing Loan in ITR1 so that I can get an exemption upto 2 lakhs.
My property is self occupied and I think I can’s show any Income from my property. All I can show is the Principle and Interest part of my loan. Principle goes under 80C but where does the Interest part goes in ITR1.
Kindly suggest.
Thanks & Regards,
Gaurav
Dear Gaurav,
You have to show under ‘income from one house property’.
Kindly note that income can be positive or negative figure(amount). For self occupied property you will have loss from income property as you do not get rental income but you pay interest payment on home loan.
Dear sir,
An amount of Rs.300/- is deducted from my salary every month towards a donation to a trust. In form 16 this is shown as a deduction under section 80 G. When I file the return online, how to show this under the specified page and claim the benefit? Awaiting your advice in the matter.
Thanks and regards,
Rohit
Dear Rohit,
You can show this as a Deduction u/s 80G in ITR1 (if ITR1 is applicable to you).
Sir, this is regarding transportatoon allowance, Rs 9600/- pa for fy 2014-15. While filling ITR 1 for salaried personnel , under which section it is to be shown as there is no column of section 10 (14) – exemption on transportion allowance,
Dear Vijendra,
You need to deduct the applicable allowances from Gross salary and key in only Net salary.
If I will deduct allowances in gross salary then GTI in form 16 and GTI in ITR 1 will mismatch,
Is it not necessary that GTI in form 16 and GTI in ITR 1 must match ?
Whether IT dept will clear my refund or put any observation as mismatch of GTI in form 16 and ITR 1
Dear Vijendra,
Whether the tax liability / refund in ITR1 & Form-16 match?
Also, IT dept go by Form 26AS (TDS details) and they do not have access to Form 16.
Which is better in terms of return SCSS or NSC.
Dear Milan.. it depends on your investment objective and horizon.
Sir
I am joining a firm which is giving me 29k salary p.m but not any other allowences for one year, suggest me some financial measure so that I can plan better and save on tds.
Dear Ashim,
It is advisable to think beyond taxes, when it comes to investment planning.
Kindly provide few details..your age? Married? dependents’ details? about your financial goals??
dear sir, i want to invest in atal pension yojana, basicaly i was in befefit of PF but as of now i have not any PF benefit. i withdrawal my PF policy. and now i want to invest in atal pension yojana, but incase i will have a PF policy in future then i will be able to continue atal pension yojana.
Dear Naresh,
You can contribute to both the schemes. You may read my article on APY-Details & Benefits.
Dear Sir, I am 35 year old salaried person .My Total CTC is 10.5L .request to pls suggest best option or guide for saving so i will save my max.tax.do needful urgently.
Dear Ajit,
Kindly share your financial goal(s)..
Read my article : Top ELSS funds.
Dear Sreekanth,
Currently my investments into 80c(LIC+PF) cross 1,50,000. But my employer is saying that to get 50,000 benefit under new 80CCD1(B), I have to make a total investment of 2,00,000 to NPS. Only then I will get the additional 50K benefit under the new guidelines. Is this correct? If not, how can we get a official clarification which could be shared with the employer?
Dear Chandra,
It is not mandatory to invest Rs 2Lakh in NPS alone, to get extra tax benefit on additional Rs 50k investment.
You can invest Rs 1.5 Lakh in 80c and you can invest the remaining Rs 50k in NPS, and claim tax deduction u/s 80ccd 1(b).
After getting PRAN number if it is possible to deposit amount to the NPS account from any bank or local postoffice by quoting the number in the contribution slip. Else i have to go personally to the account opened Head Office.
Dear Subha,
I believe that NPS can be operated from anywhere in the country.
Hi Srikanth,
We are paying 1.5l for ppf and 1.26,1.24 lakh for different lic premium.My doubt is whether these three are tax free or we need to pay tax.total per year 4L. Please clarify
Dear Pruthvi,
Uder section 80c the maximum tax deduction allowed is up to Rs 1.5 Lakh only . Over and above this limit, they are eligible for tax deductions.
Kindly let me know the LIC plan names.
Read my articles;
How to get rid off bad insurance
Top 7 best online term insurance plans
Sir
My contribution in PF , PPF and LIC premium cross Rs1.5 Lakh. Even then if i take my first home loan of Rs25 Lakh , will i get tax exemption benefit on principal amount of the loan ? If No , shall i take home loan tenure for maximum years and repay in small balloon in addition to emi ?
Dear Mr Dutta,
The maximum tax deduction that you can claim is upto Rs 1.5 Lakh only under section 80c.
Why do you want to take home loan for maximum tenure?
Hi,Sreekanth Reddy
Your post is nice and i got some info from your,can you please clear few of my doughts
In my previous company i worked for 2 years my sal is less ,but they didn’t gave any ‘PF’ or “TDS” .
I joined in new company in march 2015,that is also small company with less than 10 employees, this company is also same,but one of my friend told me to start applying for “IT Returns” and also told me to pay tax ( at least min tax), so that in long term if i apply for any lone this track record will be use full,it will be easy to get lone ,because in 2013 when i want to buy bike in lone ,i faced many problems to get lone none of the banks gave lone,at last i got it in a private finance company with more interest.Even now if i want to apply for Credit card also they are telling i don’t have any PF history. so from now i want to plane some thing so that in future if i want to apply for “Personal Lone” or “Home Lone” or Bank related or government related schemas it will be easy for me to get it without trouble.So for that can please tell me the things to follow ,my salary is 4 L PA now .
And also i am doing part time, freelance web development from 2 months , one of my client is giving check’s only instead of cash ,i deposited that check in my account i.e. is my salary account .So will this amount is calculated in tax. Next time ,do i need to deposite it to any of my other personal account.
So ,
1.For previous year ( 2014-15) how, i have to do that “Nill IT Returns” and which forum(like forum 16 or TDS), i have to take and where , since i can’t get it from my office,and when is the last date.
2.And this year (2015-16) how i can save from TAX ,since my company is not providing any thing in terms of tax or tax saving related.
So ,few people told many things like PPF,Insurance,House rent slip,post of schemes etc…. total i am confused
In terms of saving i am doing RD(Rs.500 /- Per Month for 10 years period from Jan:2014 in SBI only i.e my personal account .
Today i saw some new options in my online sbi account i.e about PPF and linking TDS account .
1.If i start paying that PPF ,later if my present company give “pf ” in future or if i change other company will this PPF will have any clash with that PF
2. we can apply that TDS personaly.
So can you please tell what to do.
Dear Swami,
Filing your Income Tax Returns (ITR) is nothing to do with how big or how small a company is..
If you have taxable income, you need to file your ITR.
I did not understand you point – “We can apply that TDS personally”..
Tax saving options – Kindly allow me to ask few questions – Are you married? Do you have any family member(s) who are financially dependent on you? What are you financial goals?
If you do not have any life insurance cover, suggest you to buy a term insurance plan immediately (if you have dependents / financial liabilities). The premium amount you pay on this can be claimed as tax deduction Under Section 80c.
You can also start a PPF account. It won’t be a problem even if your employer opens an EPF a/c for you in future.
Also, continue your RD, use it as an Emergency fund, in case if you need to meet any unforeseen expenses.
Revert to me if you need any guidance 🙂
I am single , and i have one elder brother and mother in AP,so i will pay my house lone of 4200 very month but that lone is in my mother name,i only transfer that amount to that bank lone account very month ,and i don’t have any insurance this year i will try to plan to pay insurance and PPF .
And regarding lone, if i want to apply lone in further, what i need to do now ,in terms of track record , like one thing is i need to show IT Returns, and as i told i don’t have PF history,so what i have to do for now ,do i need to wait until my company or next company(new) gives PF facility or is there any alternate option.
Thank for response .
Dear Swami,
As discussed in previous comment, if your income is more than the basic exemption limit then you need to file your income tax return. This is nothing to do with EPF or PPF. If you are contributing to PPF or EPF, you need to just show it under section 80c.
Start filing your ITR, this will help you in getting a home loan.
Do you have health insurance?
No i don’t have health insurance, now i will try to start it also,thanks for your response
Thanks
Dear Sreekanth,
I went through some of your response to the questions raised by fellow readers like me of your blog. I am a bit confused as ti whether the total exemption which one can claim under section 80 C, 80 CCC, 80 CCD and 80CCD(1b) is Rs 2,00,000 or it is Rs 1,50,000. I will put my money on NPS only if I get an additional benefit as tax exemption of Rs 50,000. Please clarify and confirm as depending on your reaponse I will take my decision. Alao is there any officiL website where one can get this clarification and detailed information.
Dear Prajesh,
The total exemption (aggregate of 80c + 80ccc + 80ccd) is Rs 1.5 Lakh.
You may invest an additional amount of up to Rs 50k in NPS to get tax benefit. So, the total exemption is Rs 2 Lakh (80c + 80ccc + 80ccd + 80ccd 1b).
You may go throgh this ‘Taxguru.in‘ article.
Hello Sreekanth Reddy,
I m a Government Employee and comes under NPS(joined in 2012).
My Savings for tax exemption are
PPF 70000
LIC 75000
Tuition Fee for children 20000
NPS deduction from my salary 56000 per year
Government contribution towards NPS 56000
1.What is the difference between 80 CCD(1),80CCD(2),80CCD(1b)
2.The NPS deduction from my salary ie 56000 falls under which section.
3.Can I claim (ppf+lic+tuition fee=165000) ie 150000 under 80C and my contribution from salary towards NPS (56000) under 80CCD(1b) for tax exemption of 50000. Here can I get a tax exemption of 2 lakhs( 80c+80ccd(1b)
Dear Shankaraiah,
You can claim employer’s contribution under section 80CCD (2).
80CCD (1) & 80 CCD (1b) is to claim your contributions.
PPF + LIC + Tuition fee can be claimed u/s 80c (maximum limit 1.5Lakh). Sec 80CCD (1) is also included in this Rs 1.5 lakh limit.
Additional Rs 50k tax deduction under NPS can be claimed u/s 80ccd (1b).
By the way, let me know the Plan names of your LIC policies?
Dear Sree,
Please consider Shankaraiah’s case (comment Posted onMay 26, 2015) .
(1) Whether he is eligible for 2 lakhs deduction ( 80c + 80 ccd(1B) from his salary.
(2) In swamy’s INCOME TAX BOOK ( IN BAGE NO 129, EXAMPLE 14 ), it is illustrated that this additional Rs. 50,000 is included within the overall limit of 1,50, ooo ( 80 CCE).
(3) When I asked the toll free number of NPS contribution, they say that this Rs. 50,000 ( saved under 80 CCD (1B) is over and above the 80 CCE limit of Rs. 1,50,000. Which is correct?
(4)I think we have to request more explanation from the govt.
Kindly clarify , share with your financial friends and GUIDE EVERY ONE.
EXPECTING YOUR REPLY.
A.JAYA KUMAR(9445789417)
KENDRIYA VIDYALAYA, TAMBARAM, CHENNAI.
PLEASE REPLY SIR………
Dear Jai.. replied to your comment under Q&A section (since you posted same query there).
Dear Sree,
Good to see that you are guiding lot of people here.
I am a Free lancer and having a consultancy company in my wife name.
Consultancy has Service tax registration, TDS Deductions from clients which will be displayed in the name of Proprietor, That is my wife.
I am only running this consultancy and wife name is titled just to divide IT. We are filing IT Returns since three years.
But, If I want a Home loan, Can I apply a Home loan under my name? I have IT Returns (3 Lacks per year at least) without TDS Since three years. (I heard that that is considered as Source of Income).
And My wife has IT Returns (3 Lacks per year at least) since three years with TDS.
I have few few question here..
What type of Document Bank asks for Home loan?
I heard that They too look for P& L Statement of company..
In our case P&L is not consistent. Because We are filing IT Returns under section 44AD, in which we can declare Presumptive Profits based on our needs.
In past three years % of profit declared in not consistent, some times 8% some times 50% ans some more times 40%.. like this
Could you please help to guide me to get sanction Home loan in this scenario?
I really really don’t know how to get Home loan.
Please Help me..
Anil
Dear Anil,
Suggest you to apply for a home loan jointly..Did you gave a thought about it?
Generally banks or financial institutions ask for documents (from self-employed individuals) as below;
Bank statements
Income Tax returns
Last 3 years p& L statement
Last 3 years CA certified P & L account..etc
Hi Shree,
Thanks for replying. I thought about that.
In our case P&L is not consistent. Because We are filing IT Returns under section 44AD, in which we can declare Presumptive Profits based on our needs.
In past three years % of profit declared in not consistent, some times 8% some times 50% ans some more times 40%.. like this
Auditor will certify it defenetly. How is it going to workout in real time, I don’t know.
Regards
Anil.
Dear Anil,
I also file my IT returns on presumptive basis.
The home loan company will decide on quantum of loan, based on their own underwriting procedures. So, suggest you to approach a home loan provide and ask for loan eligibility details. (Do not approach too many lenders)
I am a senior citizen. My daughter is working in a software company and getting around 15 lakhs/year from this financial year and she is supposed to submit the advice return form now. She is paying 92,000/-per year LIC premium and paying a house rent of 15,000/month. Under what clause she can claim these amount and what are the other avenues to reduce the payable tax. Kindly clarify the queries.
Thank you
Rangaraju
Dear Mr Rangaraju,
Kindly let me know the name of LIC policy ??
The premium payment on Life insurance policy can be claimed as a tax deduction under section 80c.
She can claim HRA (House Rent Allowance).
She can consider investing in ELSS funds for long-term wealth creation. Besides this, it is a good tax-saving option. Kindly read my article – “Top ELSS funds“.
Dear sir
G.Afternoon
I am profession in medical college M.P.
my investment
50000 in PPF
9600 GIS
80000 tution fee
55000 basic of home loan
84000 GPF (appointed in before 2004 in 1996)
can i take additional advantage of extra 50000 under 80CCD
Thanks with regards
Dr.Anil Agarwal
Dear Dr. Anil,
For FY 2015-16, the maximum tax deductions that can be availed u/s 80c is Rs 1.5 Lakh. You can contribute Rs50 k more u/s 80CCD(1 b) to NPS (National Pension System) and claim a total tax deduction of Rs 2 Lakh.
Hi Sreekanth I’m a govt employee
I will invest ₹60000 in NPS ( i.e 10% of my salary) and ₹90000 in PPF and NSC in FY 2015-16.
Now if I invest ₹50000 additionally in my Tier-1 account of NPS(without any matching contributions from my employer) will i get tax deduction benefits upto ₹ 2 lacs . Please guide me
Thanx a lot
Dear Charanjit,
Yes, you can claim tax deductions of up to Rs 2 Lac.
But how can you add additional amount from tier-1 of NPS ? I think for this you have to open a tier -2 account. I am not sure though, you should confirm this in your office.
Dear Ajeet,
I believe that the tax benefits are available only on Tier 1 account.
The tax benefits are available only on Tier 1 account of NPS, not in Tier 2 account .
Hi I need both HRA and home loan benefits. could you please tel how far km the two places be to avail the both benefits
Dear Nikky,
As per the current tax law, as long as your reason is justifiable, it is ok to claim both. I believe that it is subjective and the law does not specify any max or min distance.
As per Sec 80 CCD(1) , i am contributing 10% of my salary (basic + da ) for NPS contribution.Now my question is if I make additional contribution of Rs 50,000 under Sec 80 ccd(1b) to avail the tax benefit.Does any contribution over and above 10% of my (basic +da) in NPS shall automatically fall under sec 80 CCD( 1b).please clarify.
Dear APRATIM,
Let me know your contribution amount under Sec 80ccd (1)..??
will i get tax deduction for 200,000 if i invest 1,50000 in PPF under 80c and another 50,000 in NPS under 80 ccd
Dear Mohan,
Yes you will get the tax benefits.
v hav al ready mediclam 30 th paid this year v retiyed at november 15 as per gide how to new i vest ment ;also gide for regular income v req
Dear Praful,
What is your query? Do you want suggestions regarding where to invest the retirement amount?
v want to now some fund with req tax benifit gide v At 58 yr age
Could you please advice amounts which can be claimed as conveyance allowances and Medical reimbursements?
Dear Vipin,
Medical reimbursement allowance can be upto Rs 15,000.
Conveyance allowance increased to Rs 1600 per month.
Are ppf & LIC Pension Plan Eligible for 2 lakh for FY 2015-16?
Dear Inder Jeet,
I did not get your query..kindly re-phrase your question..
Hello Sreekanth,
I am currently drawing 9.6 Lakh p.a monthly being 80k gross. I have an education loan principal amount 4 lakh and with interest 4.65 now. I wish to know how can i file my tax returns including section 80GG limit as i pay a rent of 10k per month.
As this is my first job i am not very familiar with the tax structure. Can you advise me on the same??
Dear Ayesha,
You can claim tax deduction on the entire ‘interest amount’ paid in a financial year towards your education loan . This can be claimed under section 80E.
Do you receive House Rent Allowance? Is it part of your salary structure?
What are your other investments ? Do you have any life insurance policy / health insurance policy?
Hi Srikanth,
Pl. let me know, as my new employer has offered my fix salary of 36 lacs under which components I make the salary break-up to save taxes.
Thanks
Sunjoy
Dear Sunjoy,
It is not advisable to guide you with the limited data.
You may contact me at sreekanth [at] relakhs.com
Hi Sreekanth,thanks for giving valuable information on tax.
I am a Banker.I have taken staff housing loan of 30 lakhs .For home loan interest claim under sec 80 ee whether iam eligible.My flat is within 40 lakhs and purchased ready to move flat in feb 2015 .somewhere i have read loan amount should not be more than 25 lakhs to claim under 80EE .is it true?
Dear Sindhu,
When was the loan sanctioned?
As per Section 80 EE, Loan taken by Individual for the purpose of buy a house should not be more than 25 lakh. Kindly note that this section is applicable for AY 2014-15 & AY 2015-16 only.Also, Total deduction under this section shall not be more than 1 lakh (for both Assessment years put together).
it is help to the people
Great post Sreekanth !!! Thank you so much for sharing such a informative post with us.
Thank you Sukanya. Keep visiting!
Dear Sir
I am a state govt. Employee, my query is regarding for my taxation. I am contributing rs. 72k for nps. Half from my salary and half from govt.
i am also investing in two ELSS and PPF. My total investment will be around 160k. And total income will b approx 455 k.
please suggest or confirm me about my taxation for coming year.
will it be my savings of 80c plus 80ccd (my part of nps contribution).
or else.
as per 150k limit of 80c it is 420k of max amount of tax benefit or rebate.
How i will achieve benefit of 80c plus 80ccd for NPS.
Dear Gambhir,
The maximum allowable limit for tax deduction under section 80c + Section 80ccd is Rs 1.5 Lakh only (eventhough your tax investments are Rs 1.6 Lakh).
Sir,
You replied in affirmation to Mr. Ramkumar for his following comment.
“the maximum limit that you (as an employee/individual) can claim is Rs 2 Lakh. (Aggregate of Section 80c + Section 80ccc + Section 80CCD)”
which means already i am showing 1.5 lakh in my deduction then can i use another 50thousand rs in NPS then 1.5 + 0.5 = 2 lakh can i claim deduction.
”
How this is different from my case.
please explain me sir.
Dear Gambhir,
The maximum allowable tax deduction under sections 80 C + 80CCC+80CCD is Rs 1.5 Lakh. This is very clear.
There is a little bit of confusion (even with the CA community)regarding the additional Rs 50 k tax benefit which is under Section 80CCD (1B).
In one of my replies (to dear Jaya Kumkar), I had mentioned that more clarity is required. Let me correct my comments. Thank you!
Dear Sir,
Thanks a lot for your clarification.
Rgda.
Please suggest some mutual funds for long term investment with moderate risk.
Dear Suresh,
What are your financial goals and investment horizon (time-frame)?
THANKS A LOT, SREE. WILL U XPLAIN ABOUT NPS? WHAT ARE ITS MERITS AND DEMERITS ???? WHEN WILL WE GET BACK THE WHOLE INVESTED AMOUNT ???????????!!!!!!!!!!!!!!!!!
Dear Jaya Kumar,
Kindly read this article – “New Pension scheme.” (It is written by Shri Pattabhiraman – Professor IIT Madras)
i started my carrier as a teacher on aug 2013…i got approval for my appointment in nov 2014 and i got salary from aug 2013 (total 18 months) in feb 2015..my question is whether i have to consider these 20 months salary(aug 2013 to march 2015) or 12 months (april 2014 to march 2015) for calculating tax in this financial year
thanks in advance….
Dear Subin,
Salary from Aug 2013 to Mar 14 – you should have filed your Income Tax Returns by July 2014. Did you file it?
Salary from Apr 2014 to Mar 2015 – You need to file IT returns by July 2015.
DEAR SREEANTH ,
I AM A GOVT EMPLOYEE AND MY GPF DEDUCTIONS ALONE RS.1.50.000 UNDER 80 C. NOW CAN I INVEST ANOTHER RS.50000 IN NPS TO GET DEDUCTION UNDER 80 CCD ? PLEASE REPLY……………%%%%%%%%%%%%%%%%%%%%
Dear Jaya Kumar,
I think i kept you waiting..was away from My comp.
Yes you can invest and claim a total deduction of Rs 2 Lakh (80c + 80 CCD)
Dear Jaya Kumar,
I have contacted a friend of mine who is a practicing Chartered Accountant on this query, he said that more clarity is required wrt this section. I will definitely update you on this regard ASAP.
Dear Jaya Kumar,
There is some confusion regarding the additional benefit of Rs 50k under section 80ccd 1b. Is this part of aggregate limit of Rs 1.5 Lakh (section 80c+80ccd+80ccc) or is it a separate benefit…need more clarity..will update about this ASAP.
DEAR SREEANTH , I AM A GOVT EMPLOYEE AND MY GPF DEDUCTIONS ALONE RS.1.50.000 UNDER 80 C. NOW CQAN I INVEST ANOTHER RS.50000 IN NPS TO GET DEDUCTION UNDER 80 CCD ? PLEASE REPLY……………%%%%%%%%%%%%%%%%%%%%
Hi i have a doubt in your post what u have mentioned is
“the maximum limit that you (as an employee/individual) can claim is Rs 2 Lakh. (Aggregate of Section 80c + Section 80ccc + Section 80CCD)”
which means already i am showing 1.5 lakh in my deduction then can i use another 50thousand rs in NPS then 1.5 + 0.5 = 2 lakh can i claim deduction.
pls correct me if iam wrong
regards,
Ramkumar
Dear Ramkumar,
Yes you are right.
Are you a Govt employee?
Thanks for the consolidated infor Sree… !! Eagerly waiting for NPS review from you 🙂
Are the ELSS plans are eligible for 80c deduction in FY-2015-16? Some websites told that ELSS funds might be eliminate from 80c in this budget..is it ture? How much chances are present of elimination of ELSS from 80c list in near future?
Dear Rajdip,
Yes, You can invest in ELSS funds and take tax deduction benefit. This option is very much available for FY 2015-2016. The articles that have read might have been written before the release of Budget doc. (just speculations..)