Income Tax Deductions & Exemptions FY 2019-20
The Income Tax Slab Rates remain unchanged for the
Financial Year 2019-2020. However, Individuals with Taxable Income up to Rs
5,00,000/- per annum may avail Tax Credit up to Rs 12,500/- under Section 87A
on the Income Tax payable. Thereby, implying that Individuals with Income up to
Rs 5,00,000/- will not have any Tax Liability for the Financial Year 2019-20
and Assessment Year 2020-2021. Standard Deduction benefit has been increased to
Rs 50,000/- for the Financial Year 2019-20. For FY 2019-20, Income Tax
Deductions and Exemption is available to reduce the Taxable Income, allowing
Individuals to minimize the Tax Implications.
Income Tax
Calculation for Various Income Slabs
Income Tax Slabs
and Rates For Financial Year 2019-20
Income Tax Deductions and Exemption available under various Sections
and the investment options available to the Individuals.
Income Tax
Deductions U/S 80C
Income Tax Deduction and Exemption is available to the Individuals
under Section 80C, 80CCD, 80CCC up to the extent of Rs 1,50,000/-. These
sections are now effectively clubbed under Section 80C with the aggregate
deduction ceiling of Rs 1,50,000/-. Investment options for Income Tax Deduction
and Exemption under Section 80C has been shared in form of image (pic above).
Please refer to the link shared below to know in detail about the Investment
plans.
Public Provident Fund
ELSS Funds
National Savings Certificate (NSC)
Life Insurance Plans
Senior Citizens Savings Scheme (SCSS)
Repayment of Principal of House Loan taken is also eligible for
Deduction along with Registration Fee and Stamp Duty paid towards the same.
However, the benefit is restricted to the maximum deduction limit of Rs
1,50,000/-. Provided the Individual does not transfer the property before
expiry 5 years from the Financial Year in which it was obtained.
The deduction on Registration Fee and Stamp Duty is also available to
Individuals who have not availed Home Loan.
Income Tax
Deductions U/S 80 CCD (1b)
Investment up to Rs 50,000/- is eligible for deduction up and over the
deduction available U/S Section 80C on Contribution made to National Pension Scheme (NPS) and Atal Pension Yojana (APY).
Individuals may invest in both the schemes and avail cumulative
deduction upto Rs 50,000/- on the investment.
Income Tax
Deductions U/S 80D
Further deductions up and above the Deductions availed U/S 80C &
80CCD (1b) is available U/S 80D on payment made towards Health Insurance Premium.
It covers the premium paid on the Health Insurance cover for self and family.
Deduction of Rs 25,000/- can be availed for the premium paid for Self, Spouse
and dependent children. Deduction goes up to Rs 50,000/- on premium paid
towards the Mediclaim Insurance for Senior Citizen parents.
Income Tax
Deductions U/S 80DDB
Tax Deduction to the extent of Rs 40,000/- incurred as treatment cost
for specified medical disease for Self or dependent relative is also available.
In case of Senior Citizens the limit goes up to Rs 1,00,000/-.
This deduction is available only in cases of specified diseases such
as Cancer, Kidney Failure, AIDS, Haemophilia, AIDS, Dementia, Neurological
Disorder, etc.
Tax Deduction U/S
80E
Deduction is also available on the education loan for higher studies
(Graduation or Post Graduation) in the fields of Medicine, Engineering,
Management, or Science. The deduction is available from the 1st year
and subsequently for next 7 years. Deduction is available on the EMI paid as
interest on the loan.
Tax Deduction U/S
80G
Deductions are also available for the donations made to notified
NGO’s, Charitable Institutions are eligible for 50% or 100% deduction as
provided under the act. However the maximum limit to the deduction claimed is
10% of the Adjusted Gross Total Income after claiming other deductions.
Some of the Prescribed Notable Institutions
where 100% Deduction is available without qualifying limit:
National Defense Fund
Prime Minister Relief Fund
Swacch Bharat Kosh
National Sports Fund
National Children’s Fund
Clean Ganga Fund and many more….!!!
Tax
Deduction U/S 80GG
Deduction available in respect of House
Rent Paid, the least of the following:
Rent paid less 10% of the total income. Rs. 5000/- per month. (Maximum
Deduction available is 60,000/-) 25% of total income, provided that Assesse or
the spouse or minor child should not own residential accommodation at the place
of employment, or anywhere else and is not receipt of House Rent Allowance. The
deduction is available provided the Individual, does not receive any benefit of
deduction U/S 10 (13A) for House Rent Allowance.
Tax
Deduction U/S 24(b)
Deductions up to Rs 2,00,000/- is available on the interest paid on
the Loan availed for purchase/construction of self occupied House Property.
However the acquisition and construction of such house property should be
completed within 5 years from the end of Financial year in which Home Loan was
taken. The sum should be borrowed on or after 01/04/1999 to be eligible for
deduction.
Note: As announced in the Budget 2019 for FY 2019-20,
Additional Deduction of Rs 1,50,000/- is available on affordable housings up to
the value of Rs 45 lakhs. The deduction is applicable on loans taken up to 31st March
2020.
Tax Deduction U/S
80DD & U
Deduction of Rs 75,000 U/S 80DD is available to meet the expenses and
medical treatment of disabled dependent person. In case of severe disability
(more than 80%) the Deduction limit is raised to Rs 1,25,000/-.
Deduction of Rs 75,000 U/S 80U is available to meet the expenses and
medical treatment of Resident Individual (Self). In case of severe disability
(more than 80%) the Deduction limit is Rs 1,25,000/-.
Tax Deduction U/S
80TTA/B
Deduction from Gross Total Income up to a maximum of Rs. 10,000/-, in
respect of interest on deposits in savings account (not time deposits) with a
bank, co-operative society or post office.
The interest free income has been extended up to Rs 50,000/- in case
of Senior Citizens under Section 80TTB.
Tax Deduction U/S
80EE
Additional Deduction of Rs 50,000/- on interest paid on home loan is
available for 1st time home buyers on loans up to 35 lacs,
provided the value of house does not exceed 50 lacs. This deduction is up and
above the Rs 2,00,000/- available on account of interest paid on loan.
Deduction is available per Financial Year till the period the loan has been
fully repaid.
Loan should be sanctioned by a Financial Institution or Housing
Finance Company, provided Loan must be sanctioned between 01/04/2016 to
31/03/2017.
Income Tax Deductions and Exemptions under Section 80C to 80U
discussed taken in to consideration.
Income tax Slabs & Rates FY 2019- 20, AY
2020-21
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Income tax Slabs
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General Category
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Sr.Citizen
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Very Sr. Citizen
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Upto Rs. 2. 5Lakh
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NIL
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NIL
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NIL
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Rs.2.5 Lakh to 3.0 Lakh
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5%
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NIL
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Nil
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Rs.3.0 Lakh to Rs.5.0 lakh
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5%
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5%
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NIL
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Rs.5.0 Lakh to Rs.10.0 Lakh
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20%
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20%
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20%
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Above 10.0 Lakh
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30%
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30%
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30%
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Surcharge:
- If
the total income between Rs 50 Lakhs and Rs 1 crore, a surcharge of 10%
will be levied.
- 15%
surcharge on income tax if the total income is over and above Rs 1 cr.
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