law & acts

1. TAX Planning
VELAN SILAS. MBA, FCA
auditorsilas@gmail.com
8124037435
VIT VELLORE
BBA GUEST LECTURE
09 November 2022

3. SESSION COVERAGE:
•Section 24 – Deductions from income from
House Property
•Section 80C – Deductions on certain investments
•Section 80D – Deductions on medical expenses
•Section 80G – Deductions on donations made
•Tax planning Vs Tax avoidance
•Tax calculation Illustrations

6. Section 24, deductions from hp:
• Income from HP, to be taxed on notional income
• Section 24(1) Std deduction of 30% on NAV
• Section 24(2) Deduction on Interest on housing loan (Construct, reconstruct, repair,
renovation)
• Self occupied 2 lacs, loan after 01.04.1999, constructed within 5years, interest
certificate, FI
• Let out, no limit of interest paid
• 5 equal instalments for interest under construction
• FAQ:
• How many years
• Loan in joint names
• New loan to close old loans
• For how many houses
• Housing loan from friends and relatives
• Rental income of unsold flat of a builder

7. Section 80c: (for Individuals & HUF)
•EPF, PPF, ELSS, Tution
fee, Housing loan
principle, FD, NSC,
Sukanya Samriddhi
Yojana, Senior citizen
saving schemes, LIC
premium (15%), post
office savings scheme

8. Section 80d:
• For Individuals and HUF
• Self, spouse, dependent children/parents
• Premium should not be paid in cash
• Preventive health check up Rs.5K within 25/50K may
be in cash
• Medical expense of SC 50K
• Contribution to CGHS approved by CG
• No service tax or cess on premium is allowed
• Group insurance by coy not eligible
• Shared premium, shared claim
• Ex. Rohan is aged 45 years, and his father is aged 75
years. Rohan has taken a medical cover for himself
and his father, for which he pays insurance premiums
of Rs 30,000 and Rs 35,000, respectively. What
would be the maximum amount he can claim by way
of a deduction under Section 80D?
Scenario Premium paid (Rs) Deduction under 80D (Rs)
Self, family, children Parents
Individual and parents below 60
years
25,000 25,000 50,000
Individual and family below 60
years but parents above 60 years
25,000 50,000 75,000
Both individual, family and parents
above 60 years
50,000 50,000 1,00,000
Members of HUF 25,000 25,000 25,000
Non-resident individual 25,000 25,000 25,000

9. Section 80G: deduction on donations
100% Deduction without qualifying limit
1. PM National relief fund
2. National Defence fund
3. National children fund
4. CM earthquake relief fund etc
5. Total 24 funds
50% Deduction without qualifying limit
1. Jawaharlal Nehru memorial fund
2. Prime Minister draught relief fund
3. Indira Gandhi Memorial Trust
4. Rajiv Gandhi Foundation
100% Deduction subject to qualifying limit
1. To Govt, any approved authority or institution for
family planning and
2. Paid by coy to Indian Olympic Association or any
sports association.
50% Deduction subject to qualifying limit
1. Any institution established in India for charity
2. To Govt or local authority for charitable purpose
other than family planning
3. Authority for housing accommodation
4. Central or State Govt corporation for Minority
community
5. For renovation of place of public worship,
historical places

10. 80g. Computation of qualifying limit:
OTHER POINTS
• Donation in kind not eligible for
deduction
• No cash donations exceeding Rs.2000
• Business connection is not required
• New form # 10BD by the entity to be
filed from this current FY for 50%
subject to qualifying limit category
• Donor details need to be obtained

11. MCQ – TEST
1. Chief Minister Earthquake relief fund qualifies for
• A. 100% deduction subject to qualifying limit
• B. 50% deduction without qualifying limit
• C. 100% deduction without qualifying limit
• D. 50% deduction subject to qualifying limit
2. Mr. Anbu paid housing loan interest during first year of construction 50000 and second year of construction
40000. What is the eligible deduction u/s 24(ii)
A. Rs. 50000 C. Rs. 90000
B. Rs.40000 D. Rs. 18000
3. Form 10BD to be filed by the donation receiving entity for which category of donation?
• A. 100% deduction subject to qualifying limit
• B. 50% deduction without qualifying limit
• C. 100% deduction without qualifying limit
• D. 50% deduction subject to qualifying limit
4. Mr. Babu a NRI paid Rs.60000 as medical insurance for his dependent father who is 75 years old. The eligible
exemption u/s 80D would be
A. Rs.50000
B. Rs.60000
C. Rs. 25000
D. None of the above

12. tax planning Vs Tax avoidance
•TDS and advance tax by effective planning
•Transfer the asset or fund to non income or lower income assesse
•Formation of HUF to avail basic exemption limit
•Effective utilisation of variety of sections
•Responsibility of an assesse not on employer to declare income to
Dept
•Avail professional service
•Pay appropriate tax rate for the lower deducted incomes to avoid
interest
•Effectively designing pay or salary structure
•More stringent penal provisions

13. CONCLUDING REMARKS:
•Intention of Govt encourages public spending and discourage savings due
to pandemic & adverse effect on economy
•It adversely affects sentiment on savings and it may be temporary
phenomena
•Govt’s move is to tax at the point of income/spending, via TDS and TCS
against Annual Tax, compliance free, plan and declare to your employer
all incomes and savings
•Tax planning Vs Tax avoidance, based on individual’s savings appetite
•Do I need to file ITR, if TDS deducted?
•Do I need to pay tax? Can I get refund?
•Check out 26AS and AIS
•Year to year check out which regime is beneficial and opt for it