SlideShare ist ein Scribd-Unternehmen logo
1 von 25
Downloaden Sie, um offline zu lesen
LOGO
R Venkatakrishnan &Associates
Chartered Accountants
Offices at
Chennai Bangalore Hyderabad Salem Devanahalli
http://www.rvkassociates.com
Tax Planning
for Employee
R Venkatakrishnan & Associates, Chartered Accountants
Topics
Introduction1
Salary Income2
Special Exemptions in Salary Income3
Deductions from Taxable Income4
Other Information5
Confusions in Jan to Mar
R Venkatakrishnan & Associates, Chartered Accountants
How do I
learn
about my
investment
and taxes?
Can I use
both HRA
and Home
loan to save
taxes?
What is the
max I can
save on
Taxes?
How much
tax I Need to
pay this
year?
PPF,FD or
Insurance
for Tax
saving?
What is the
mystery of
80’s in tax
planning?
Why did I buy
that insurance
thing which I
never require? How much
benefit I can get
for my home
and education
loan?
R Venkatakrishnan & Associates, Chartered Accountants
1. Introduction
 Income tax:- Tax on the income earned. Income tax is an
important source of revenue for government in all the countries
today.
 Income :- Income means some monetary returns periodically
received from some definite source.
 Who is supposed to pay income tax :-
- An individual
- A company
- A firm
- A HUF
- A local authority
- A BOI or AOP
- AJP
R Venkatakrishnan & Associates, Chartered Accountants
Total Income of an Individual Assessee
Particulars Amount
Income from Salary 7,50,000
Income from House Property (1,50,000)
Profits/Gains from Business or Profession 50,000
Income from Capital Gains 35,000
Income from other source 15,000
Gross Total Income 7,00,000
Less : Deductions under Chapter VI-A (1,20,000)
Total Income 5,80,000
* The above figures are illustrative
R Venkatakrishnan & Associates, Chartered Accountants
2. SALARY INCOME
(SECTION 15,16 & 17)
What is salary?
 Every payment made
 By employer to employee
 For services rendered
 Includes both monetary and non monetary facilities
 Foregoing salary is salary income
 Tax free salary should include the tax paid by the employer
Basis of Charge
 Salary is chargeable to tax when it is due to be paid whether it is paid or not
 Salary is chargeable to tax when any amount is paid whether it is due or not
 Arrears of salary paid to employee is chargeable to tax (in the year of receipt)
R Venkatakrishnan & Associates, Chartered Accountants
2. SALARY INCOME contd..
Salary includes…
R Venkatakrishnan & Associates, Chartered Accountants
2. SALARY INCOME contd..
Income from “Salary”
includes
Salary Allowances
Fully
Taxable
Fully
Exempted
Partially
Exempted
Special
Exemptions
Perquisites
Taxable
Perquisites
Non
Taxable
Perquisites
Profit in
lieu of
salary
R Venkatakrishnan & Associates, Chartered Accountants
2. SALARY INCOME contd..
Salary includes:
 Basic salary and allowances
 DA
 Advance salary
 Arrear Salary
 Leave salary
Fully Taxable Salary:
 Family Allowance
 Overtime, servant, warden
Allowance.
 Lunch or Tiffin allowance
 Leave encashment during service
 Monthly or uncommuted pension
 Bonus
 Commission
 Profit in lieu of salary
R Venkatakrishnan & Associates, Chartered Accountants
2. SALARY INCOME contd..
 Travelling Allowance
 Daily Allowance
 Conveyance Allowance
 Helper Allowance
 Academic Allowance
 Uniform Allowance
Fully Exempted Allowances:
Note: Allowances received should be expensed towards official performance of duties only.
Partially Exempted Allowances:
Type of Allowance Amount of Exemption (in Rs.)
Children Education Allowance `100 p.m. per child (restricted to 2 children)
Children Hostel Expenditure Allowance `300 p.m. per child (restricted to 2 children)
Transport Allowance `800 p.m. (`1600 p.m. if the employee is
blind/handicapped)
Note: Partially exempted allowances mentioned above are not complete and includes other
allowances mentioned in section 10(14) of the Act.
R Venkatakrishnan & Associates, Chartered Accountants
2. SALARY INCOME contd..
 Perquisites includes any amount due to or received in lump sum or
otherwise, by an assessee, from an employer. Perquisites are usually
attached to a position, by an organization.
Perquisites Meaning:
 Value of Rent free accommodation given by the Employer.
 Value of Accommodation given at concessional rate.
 Value of benefit given free of cost or at concessional rate.
 Sum paid by employer on behalf of the employees for any obligation payable by
the employee.
 Value of any specified securities or sweat equity shares allocated to employee at
free of cost or at a concessional rate.
 Amount contributed by employer to an approved superannuation fund in excess
of Rs.1,00,000/-.
 Sum paid/payable by the employer towards insurance on the life of the Individual.
Perquisites includes
R Venkatakrishnan & Associates, Chartered Accountants
3.Special Salary Exemptions
House Rent Allowance
• The HRA exemption, that can be claimed for
the Tax Exemption is minimum of the
following:
• Actual HRA received.
• Rent paid less 10% of the Salary.
• 40%/50% of Salary.
• If the rent paid during the year exceeds 1
lakh, you need to submit the PAN of the
landlord or declaration from landlord(if PAN
not available) to employer.
R Venkatakrishnan & Associates, Chartered Accountants
3.Special Salary Exemptions contd..
Leave Travel Assistance (LTA)
• Meaning: Leave Travel Assistance may be provided by the employer to the employee
and his family -
• In connection with his proceeding on leave to any place in India, while in service.
• Proceeding to any place in India after the retirement or termination from service.
• Family of an Individual means:
• Spouse and children of the Individual, and
• Parents, Brothers and Sisters of the individual or any of them, wholly or mainly
dependent on him.
• Conditions for Benefit:
• The Individual can avail the benefit of LTA offered by his employer twice in block of
four years,
• This exemption is available only for two children of an Individual born on or after
01.10.1998. But there is no limit in case of children born before 01.10.1998.
• Amount of Exemption for LTA:
• The maximum amount of exemption is the cost of travel on the shortest route. The
Exemption amounts for various travelling modes are calculated in the following
manner:
Mode of Travel Class of Travel Amount Exempt
Airways Economy Class Travel Charges on the Shortest Route collected by National Airways
Train I class AC Travel Charges on the Shortest Route
Recognized Transport Deluxe Class Travel Charges on the Shortest Route
Other Transport - I Class AC fare as per Railways, equivalent for the distance for Shortest
Route.
R Venkatakrishnan & Associates, Chartered Accountants
3.Special Salary Exemptions contd..
Unfurnished
accommodation
Owned by
Employer
Population > 25L
– 15% of Salary
Population > 10L
– 10% of Salary
Other places
– 7.5% of Salary
Not owned by
employer
Rent paid by
employer or 15%
of salary,
whichever is
lower
Accommodation in
the hotel
24% of salary or
actual charges,
whichever is
lower
Furnished
Accommodation
Furniture owned by
Employer
Value of
Unfurnished
Accommodation +
10% p.a. of Cost
of furniture
Hired from Third
Party
Value
Unfurnished
Accommodation
+ Actual Charges
Taxability of Rent Free Accommodation
R Venkatakrishnan & Associates, Chartered Accountants
3.Special Salary Exemptions contd..
Private purpose Official Purpose Private and official purpose
Car owned by the employee and expenses met by him
Not a perquisite Not a perquisite Not a perquisite
Car owned by the employee and expenses are reimbursed by the employer
Actual Expense
Less : Amount recovered
Not a perquisite Actual Expense Less:
Up to 1.6Ltrs 1800+900 for chauffer
Above 1.6Ltrs 2400+900 for chauffer
Car is owned/ hired by the employer and expenses met by the employer
Actual Expense
Add: Depreciation @10%
/ hire charges
Less : Amount recovered
Not a perquisite Taxable Value
Up to 1.6Ltrs 1800+900 for chauffer
Above 1.6Ltrs 2400+900 for chauffer
Car is owned/ hired by the employer and expenses met by the employee
Depreciation @10% / hire
charges
Less : Amount recovered
Not a perquisite Taxable Value
Up to 1.6Ltrs 600+900 for chauffer
Above 1.6Ltrs 900+900 for chauffer
Taxability of Motor Car Benefits
R Venkatakrishnan & Associates, Chartered Accountants
4.Deductions from Taxable Income
 Tax Saving Sections:
Section 80C
(Lots of Options
discussed in detailed
later)
Section 80CCC
(Pension Products)
Section 80CCD
(Approved Pension
Scheme)
Maximum Deduction of Rs.1,00,000/-
Investment&
Expenditure
R Venkatakrishnan & Associates, Chartered Accountants
Section 80C,80CCC,80CCD
 The Maximum deduction available combining all the following
investments/expenditures is Rs 1 Lakh.
 All the investments in 80C,80CCC,80CCD can be categorized as follows:
Investment
Options (I)
Provident Fund
Public Provident Fund
National Savings
Certificate(NSC)
Senior Citizens Savings
Scheme
Tax Savings Fixed
Deposits
Investment
Options (II)
Life Insurance Premium
Pension plans from
insurance companies
New pension Scheme
Tax Savings Mutual
Funds
Central Govt Employees
Pension Scheme
Expenditures
Principal payment on
Home loan
Stamp duty and
registration cost of the
house
Tuition Fee for 2
children
R Venkatakrishnan & Associates, Chartered Accountants
Tax Saving Sections contd..Donations
Section 80G
Donations to charitable
funds and charitable
institutions
10% on Adjusted GTI
50% or 100% of
donation
Section
80GGA
Donations for scientific
research or rural
development
No limit
Section
80GGC
Donations to political
parties
No limit
HealthandWell
being
Section
80D
Medical
Insurance for
Family and
parents
Deduction up to
Rs.15,000/- or
Rs.20,000/-
Section
80DD
Maintenance and
medical treatment
of Disabled
dependent
Deduction up to
Rs.50,000/- or
Rs.1,00,000/-
Section
80DDB
Treatment of
Certain
disease/ailment
Deduction up to
Rs.40,000/-or
Rs.60,000/-
Section
80U
Physically
disabled
Assessee
Deduction of
Rs.50,000/- or
Rs.1,00,000/-
R Venkatakrishnan & Associates, Chartered Accountants
Tax Saving Sections contd..Others
Section 80GG
Payment of rent in the
place of HRA
Deduction up to
Rs.24,000/-
Section
80CCG
Rajiv Gandhi Equity
Savings Scheme
Deduction up to
Rs.25,000/-(50% of
amount invested)
Section
80TTA
Interest received in
Savings Account
Deduction up to
Rs.10000/-
Loans
Section 80E
Interest payable on
education loan
No limit for deduction
Section 24
Interest payable on
Housing loan
Deduction up to
Rs.1,50,000/- on
housing loan
Section 80EE
(w.e.f. AY 2014-15)
Interest payable on
Housing Loan
Deduction up to
Rs.1,00,000/-
R Venkatakrishnan & Associates, Chartered Accountants
Rajiv Gandhi Equity Savings Scheme(RGESS)
 RGESS is a new tax saving scheme which was announced in 2012 to encourage first time investors in
stock market
 Under RGESS, you are eligible for a tax deduction on 50% of the amount invested
 The maximum amount eligible for investment in a year is 50000.
So limit on max deduction is 50% of 50000=25000
 You can invest in BSE-100 and CNX-100 and public sector enterprises ( Navaratna, Maharatna,
Miniratna)
 Mutual funds which invests only in these companies are also eligible for deduction
Who can Invest in RGESS:
 This scheme is for new investors to come into stock market. Encourage them to invest in stock markets.
 Who didn’t have a Demat A/c on Nov 23, 2011(i.e the date on which the scheme notified.
 Have not transacted in equity or derivative before the above date.
 Had a demat account but as second joint holder.
 Your Gross Total Income Should be less than 12L
Open a Demat
Account
Designate the A/c
as RGESS account
Buy Eligible
Stocks
Submit Demat
statement as proof
to claim tax
benefit
Steps to claim Tax Benefit in RGESS
R Venkatakrishnan & Associates, Chartered Accountants
5.Other Important Information
Home Loan: Interest and Principal
 Buying a house is one of the top most priority for most
 The Good news is you get tax deduction on both principal and interest payment on your
Housing Loan
Home Loan
Principal
Deduction u/s 80C up to
Rs.1 lakh
Interest
Deduction u/s 24 up to
Rs.1.5 lakh
Addl Deduction u/s 80EE
up to Rs.1 lakh
Deduction on Principal payment on Home Loan
Deduction up to Rs 1 Lakh is allowed on the principal repayment of the housing loan if the house is self
occupied or vacant.
The house should be registered in the name of the assessee. (Can be Joint owner as well)
The loan should be from Banks, NBFCS or respective employers. Loans taken from friends/relatives does
not qualify for this deduction.
The deduction is available also for people with multiple properties.
R Venkatakrishnan & Associates, Chartered Accountants
Home Loan: Interest and Principal
Deduction on Interest payment on Home Loan
 Deduction up to Rs.1.5Lakh is allowed on the Interest payment of the housing loan in case of
single non-rented house.
 Incase of rented or multiple houses there is no limit on amount of deduction.
 All the rent you received will be your taxable income(Income)
 Interest paid will be taken as expense(Expense)
 Net amount will be considered as your Income/Loss from House Property.
Additional Deduction on Interest Payment on Housing Loan
A new section 80EE has been inserted w.e.f FY 2013-14, which gives additional deduction of
Rs.1lakh on payment of interest on housing loan subject to following conditions:
The Loan needs to be taken in the financial year 2013-14
Loan should be taken from banks or housing finance companies
Loan < 25L
Value of House <40L
No other property at the time of loan sanction.
The additional deduction on Interest payment of home loans can be claimed in FY 2013-14, in case
you are not able exhaust the limit in FY 2013-14, The balance can be claimed in FY 2014-15
R Venkatakrishnan & Associates, Chartered Accountants
When?
R Venkatakrishnan & Associates, Chartered Accountants
Any Questions
Prepared By:
Korada Devi Vara Prasad
Audit Executive –CA Final , CWA Final
R Venkatakrishnan & Associates
Email us at: assurance@rvkassociates.com
Visit us at : http://www.rvkassociates.com
LOGO

Más contenido relacionado

Was ist angesagt?

Public provident fund
Public provident fundPublic provident fund
Public provident fundVarun
 
Income under the 5 heads
Income under the 5 headsIncome under the 5 heads
Income under the 5 headsRishiraj Yadav
 
Income under head salaries
Income under head salariesIncome under head salaries
Income under head salariesANAND KANKANI
 
Income from business or profession
Income from business or professionIncome from business or profession
Income from business or professionParminder Kaur
 
Income from Salary
Income from SalaryIncome from Salary
Income from SalaryRAJESH JAIN
 
Public provident fund 2
Public provident fund 2Public provident fund 2
Public provident fund 2Suresh Murugan
 
Income From Other Sources
Income From Other SourcesIncome From Other Sources
Income From Other SourcesAmeet Patel
 
Tax Planning Concept and tax planning with specific managerial decisions
Tax Planning Concept and tax planning with specific managerial decisionsTax Planning Concept and tax planning with specific managerial decisions
Tax Planning Concept and tax planning with specific managerial decisionsSundar B N
 
Assessment of co operative societies
Assessment of co operative societiesAssessment of co operative societies
Assessment of co operative societiesDVSResearchFoundatio
 
FORMS OF ORGANISATION WITH RESPECT TO TAXATION
FORMS OF ORGANISATION WITH RESPECT TO TAXATION FORMS OF ORGANISATION WITH RESPECT TO TAXATION
FORMS OF ORGANISATION WITH RESPECT TO TAXATION Priya Singh
 
Corporate tax planning
Corporate tax planning Corporate tax planning
Corporate tax planning Anuj Bhatia
 
Tax planning,evasion and avoidance
Tax planning,evasion and avoidanceTax planning,evasion and avoidance
Tax planning,evasion and avoidancepriyanka naik
 

Was ist angesagt? (20)

Public provident fund
Public provident fundPublic provident fund
Public provident fund
 
Tax Planning in india
Tax Planning in indiaTax Planning in india
Tax Planning in india
 
Income under the 5 heads
Income under the 5 headsIncome under the 5 heads
Income under the 5 heads
 
Public provident fund
Public provident fundPublic provident fund
Public provident fund
 
Income under head salaries
Income under head salariesIncome under head salaries
Income under head salaries
 
Income from business or profession
Income from business or professionIncome from business or profession
Income from business or profession
 
Income from Salary
Income from SalaryIncome from Salary
Income from Salary
 
Public provident fund 2
Public provident fund 2Public provident fund 2
Public provident fund 2
 
Income From Other Sources
Income From Other SourcesIncome From Other Sources
Income From Other Sources
 
Tax Planning Concept and tax planning with specific managerial decisions
Tax Planning Concept and tax planning with specific managerial decisionsTax Planning Concept and tax planning with specific managerial decisions
Tax Planning Concept and tax planning with specific managerial decisions
 
Divedend
DivedendDivedend
Divedend
 
Assessment of co operative societies
Assessment of co operative societiesAssessment of co operative societies
Assessment of co operative societies
 
Income from other sources
Income from other sources Income from other sources
Income from other sources
 
Set off and carry forward of losses
Set off and carry forward of lossesSet off and carry forward of losses
Set off and carry forward of losses
 
FORMS OF ORGANISATION WITH RESPECT TO TAXATION
FORMS OF ORGANISATION WITH RESPECT TO TAXATION FORMS OF ORGANISATION WITH RESPECT TO TAXATION
FORMS OF ORGANISATION WITH RESPECT TO TAXATION
 
Tax Saving Investments
Tax Saving InvestmentsTax Saving Investments
Tax Saving Investments
 
Fixed Deposits
Fixed DepositsFixed Deposits
Fixed Deposits
 
income tax
income taxincome tax
income tax
 
Corporate tax planning
Corporate tax planning Corporate tax planning
Corporate tax planning
 
Tax planning,evasion and avoidance
Tax planning,evasion and avoidanceTax planning,evasion and avoidance
Tax planning,evasion and avoidance
 

Andere mochten auch

Take home salary optimisation tips
Take home salary optimisation tipsTake home salary optimisation tips
Take home salary optimisation tipsRakesh Thakral
 
income tax planning (University Pune.) by shivaji lande
income tax planning (University Pune.) by shivaji landeincome tax planning (University Pune.) by shivaji lande
income tax planning (University Pune.) by shivaji landeshivaji lande
 
Employee benefits hr ppt
Employee benefits hr pptEmployee benefits hr ppt
Employee benefits hr pptMark Sammy
 
GAO-05-215 PERFORMANCE Budgeting in States
GAO-05-215  PERFORMANCE Budgeting in StatesGAO-05-215  PERFORMANCE Budgeting in States
GAO-05-215 PERFORMANCE Budgeting in StatesBrian James
 
Performance budgeting - Camila Vammalle, OECD
Performance budgeting - Camila Vammalle, OECDPerformance budgeting - Camila Vammalle, OECD
Performance budgeting - Camila Vammalle, OECDOECD Governance
 
Income Tax and Financial Plan
Income Tax and Financial PlanIncome Tax and Financial Plan
Income Tax and Financial PlanSamarendra Mishra
 
Tax planning for salaried emp. 8.8.2012(final)
Tax planning for salaried emp. 8.8.2012(final)Tax planning for salaried emp. 8.8.2012(final)
Tax planning for salaried emp. 8.8.2012(final)ishan parikh production
 
2014 essential tax and wealth planning guide
2014 essential tax and wealth planning guide2014 essential tax and wealth planning guide
2014 essential tax and wealth planning guideDeloitte United States
 
2015 Individual Tax Planning Supplement
2015 Individual Tax Planning Supplement2015 Individual Tax Planning Supplement
2015 Individual Tax Planning SupplementCBIZ, Inc.
 
Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction ...
Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction ...Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction ...
Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction ...Vivek Kumar
 
Kaiser - Individual Income Taxation slides
Kaiser - Individual Income Taxation slidesKaiser - Individual Income Taxation slides
Kaiser - Individual Income Taxation slideskrk811
 
Employee allowances - compensation management - Manu Melwin Joy
Employee allowances -  compensation management - Manu Melwin JoyEmployee allowances -  compensation management - Manu Melwin Joy
Employee allowances - compensation management - Manu Melwin Joymanumelwin
 
Personal Finance Pyramid and Tax Deduction_Exemption FY2016_17
Personal Finance Pyramid and Tax Deduction_Exemption FY2016_17Personal Finance Pyramid and Tax Deduction_Exemption FY2016_17
Personal Finance Pyramid and Tax Deduction_Exemption FY2016_17Reena Somaiya
 
Personal Income Tax 2016 Guide Part 2
Personal Income Tax 2016 Guide Part 2Personal Income Tax 2016 Guide Part 2
Personal Income Tax 2016 Guide Part 2Joyce Lim
 

Andere mochten auch (20)

Tax Planning
Tax PlanningTax Planning
Tax Planning
 
Take home salary optimisation tips
Take home salary optimisation tipsTake home salary optimisation tips
Take home salary optimisation tips
 
Final ct
Final ctFinal ct
Final ct
 
Perquisites
PerquisitesPerquisites
Perquisites
 
Perquisites & allowance
Perquisites &  allowancePerquisites &  allowance
Perquisites & allowance
 
income tax planning (University Pune.) by shivaji lande
income tax planning (University Pune.) by shivaji landeincome tax planning (University Pune.) by shivaji lande
income tax planning (University Pune.) by shivaji lande
 
Employee benefits hr ppt
Employee benefits hr pptEmployee benefits hr ppt
Employee benefits hr ppt
 
GAO-05-215 PERFORMANCE Budgeting in States
GAO-05-215  PERFORMANCE Budgeting in StatesGAO-05-215  PERFORMANCE Budgeting in States
GAO-05-215 PERFORMANCE Budgeting in States
 
Performance budgeting - Camila Vammalle, OECD
Performance budgeting - Camila Vammalle, OECDPerformance budgeting - Camila Vammalle, OECD
Performance budgeting - Camila Vammalle, OECD
 
Income Tax and Financial Plan
Income Tax and Financial PlanIncome Tax and Financial Plan
Income Tax and Financial Plan
 
Tax planning for salaried emp. 8.8.2012(final)
Tax planning for salaried emp. 8.8.2012(final)Tax planning for salaried emp. 8.8.2012(final)
Tax planning for salaried emp. 8.8.2012(final)
 
2014 essential tax and wealth planning guide
2014 essential tax and wealth planning guide2014 essential tax and wealth planning guide
2014 essential tax and wealth planning guide
 
2015 Individual Tax Planning Supplement
2015 Individual Tax Planning Supplement2015 Individual Tax Planning Supplement
2015 Individual Tax Planning Supplement
 
Indirect tax 2013
Indirect tax 2013Indirect tax 2013
Indirect tax 2013
 
Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction ...
Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction ...Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction ...
Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction ...
 
Kaiser - Individual Income Taxation slides
Kaiser - Individual Income Taxation slidesKaiser - Individual Income Taxation slides
Kaiser - Individual Income Taxation slides
 
Employee allowances - compensation management - Manu Melwin Joy
Employee allowances -  compensation management - Manu Melwin JoyEmployee allowances -  compensation management - Manu Melwin Joy
Employee allowances - compensation management - Manu Melwin Joy
 
Personal Finance Pyramid and Tax Deduction_Exemption FY2016_17
Personal Finance Pyramid and Tax Deduction_Exemption FY2016_17Personal Finance Pyramid and Tax Deduction_Exemption FY2016_17
Personal Finance Pyramid and Tax Deduction_Exemption FY2016_17
 
Personal Income Tax 2016 Guide Part 2
Personal Income Tax 2016 Guide Part 2Personal Income Tax 2016 Guide Part 2
Personal Income Tax 2016 Guide Part 2
 
Winter project
Winter projectWinter project
Winter project
 

Ähnlich wie Tax plannig for an employee

Individual txation-fy-2020-21
Individual txation-fy-2020-21Individual txation-fy-2020-21
Individual txation-fy-2020-21pathuriyakub
 
introduction-to-direct-indirect-tax.ppt
introduction-to-direct-indirect-tax.pptintroduction-to-direct-indirect-tax.ppt
introduction-to-direct-indirect-tax.pptTayyabaAkram15
 
Taxation - Rupee saved is a rupee earned !!
Taxation - Rupee saved is a rupee earned !!Taxation - Rupee saved is a rupee earned !!
Taxation - Rupee saved is a rupee earned !!CA Himanshu Jagetiya
 
Salaries presentation presented by Sachin Gujar
 Salaries presentation  presented by Sachin Gujar Salaries presentation  presented by Sachin Gujar
Salaries presentation presented by Sachin GujarRamesh Verma
 
Lab file on corporate tax planing
Lab file on corporate tax planingLab file on corporate tax planing
Lab file on corporate tax planingSukhchain Aggarwal
 
Lecture 7 salary
Lecture 7   salaryLecture 7   salary
Lecture 7 salarysumit235
 
Crack your salary slip
Crack your salary slipCrack your salary slip
Crack your salary slipVaibhav Gupta
 
From Tedious to TDS | Entrepreneur's guide to withholding taxes in India
From Tedious to TDS | Entrepreneur's guide to withholding taxes in IndiaFrom Tedious to TDS | Entrepreneur's guide to withholding taxes in India
From Tedious to TDS | Entrepreneur's guide to withholding taxes in IndiaPrequate Advisory
 
INCOME TAX PLANNING IN INDIA PPT Document 1.pptx
INCOME TAX PLANNING IN INDIA PPT Document 1.pptxINCOME TAX PLANNING IN INDIA PPT Document 1.pptx
INCOME TAX PLANNING IN INDIA PPT Document 1.pptxSunilBhandari51
 
Income under head salaries
Income under head salariesIncome under head salaries
Income under head salariesVaibhav Badgi
 
54317688 personal-taxation-tax-management-4
54317688 personal-taxation-tax-management-454317688 personal-taxation-tax-management-4
54317688 personal-taxation-tax-management-4Trupti2710
 
Budget 2018 for the common man
Budget 2018 for the common manBudget 2018 for the common man
Budget 2018 for the common manAmeet Patel
 
Income tax entitlements
Income tax entitlementsIncome tax entitlements
Income tax entitlementsUday Chava
 
Itr salary ppt
Itr salary pptItr salary ppt
Itr salary pptsunmitt74
 
Income under the head salary
Income under the head salaryIncome under the head salary
Income under the head salaryParminder Kaur
 

Ähnlich wie Tax plannig for an employee (20)

Individual txation-fy-2020-21
Individual txation-fy-2020-21Individual txation-fy-2020-21
Individual txation-fy-2020-21
 
Calculation of tds on salary.bose
Calculation of tds on salary.boseCalculation of tds on salary.bose
Calculation of tds on salary.bose
 
introduction-to-direct-indirect-tax.ppt
introduction-to-direct-indirect-tax.pptintroduction-to-direct-indirect-tax.ppt
introduction-to-direct-indirect-tax.ppt
 
Income from salary
Income from salaryIncome from salary
Income from salary
 
Taxation - Rupee saved is a rupee earned !!
Taxation - Rupee saved is a rupee earned !!Taxation - Rupee saved is a rupee earned !!
Taxation - Rupee saved is a rupee earned !!
 
Salaries presentation presented by Sachin Gujar
 Salaries presentation  presented by Sachin Gujar Salaries presentation  presented by Sachin Gujar
Salaries presentation presented by Sachin Gujar
 
Lab file on corporate tax planing
Lab file on corporate tax planingLab file on corporate tax planing
Lab file on corporate tax planing
 
Lecture 7 salary
Lecture 7   salaryLecture 7   salary
Lecture 7 salary
 
Crack your salary slip
Crack your salary slipCrack your salary slip
Crack your salary slip
 
From Tedious to TDS | Entrepreneur's guide to withholding taxes in India
From Tedious to TDS | Entrepreneur's guide to withholding taxes in IndiaFrom Tedious to TDS | Entrepreneur's guide to withholding taxes in India
From Tedious to TDS | Entrepreneur's guide to withholding taxes in India
 
INCOME TAX PLANNING IN INDIA PPT Document 1.pptx
INCOME TAX PLANNING IN INDIA PPT Document 1.pptxINCOME TAX PLANNING IN INDIA PPT Document 1.pptx
INCOME TAX PLANNING IN INDIA PPT Document 1.pptx
 
1384505478.ppt
1384505478.ppt1384505478.ppt
1384505478.ppt
 
Income under head salaries
Income under head salariesIncome under head salaries
Income under head salaries
 
54317688 personal-taxation-tax-management-4
54317688 personal-taxation-tax-management-454317688 personal-taxation-tax-management-4
54317688 personal-taxation-tax-management-4
 
Budget 2018 for the common man
Budget 2018 for the common manBudget 2018 for the common man
Budget 2018 for the common man
 
Session 3 Print
Session 3   PrintSession 3   Print
Session 3 Print
 
Income tax entitlements
Income tax entitlementsIncome tax entitlements
Income tax entitlements
 
Itr salary ppt
Itr salary pptItr salary ppt
Itr salary ppt
 
Assessment procedure 1
Assessment procedure  1Assessment procedure  1
Assessment procedure 1
 
Income under the head salary
Income under the head salaryIncome under the head salary
Income under the head salary
 

Último

Jeremey Tevebaugh Indicted for Check Forgery
Jeremey Tevebaugh Indicted for Check ForgeryJeremey Tevebaugh Indicted for Check Forgery
Jeremey Tevebaugh Indicted for Check ForgeryAbdul-Hakim Shabazz
 
Public Health and Intellectual Property Rights
Public Health and Intellectual Property RightsPublic Health and Intellectual Property Rights
Public Health and Intellectual Property RightsPratiksha Mishra
 
Biography Presentation of Manoj sharma [IPS]
Biography Presentation of Manoj  sharma [IPS]Biography Presentation of Manoj  sharma [IPS]
Biography Presentation of Manoj sharma [IPS]theunheardstories45
 
tort pptx by Abebayehu .pdf extra contractual
tort pptx by Abebayehu .pdf extra contractualtort pptx by Abebayehu .pdf extra contractual
tort pptx by Abebayehu .pdf extra contractualHananAmdemariam
 
GS Holistic Court Opinion in Trademark Dispute
GS Holistic Court Opinion in Trademark DisputeGS Holistic Court Opinion in Trademark Dispute
GS Holistic Court Opinion in Trademark DisputeMike Keyes
 
1038220242024-03-11-527359.pdfKIpokpikfkkovk
1038220242024-03-11-527359.pdfKIpokpikfkkovk1038220242024-03-11-527359.pdfKIpokpikfkkovk
1038220242024-03-11-527359.pdfKIpokpikfkkovkbhavenpr
 
The Concept of Rule of law : origin, development & Indian Constitution.
The Concept of  Rule of law : origin, development & Indian Constitution.The Concept of  Rule of law : origin, development & Indian Constitution.
The Concept of Rule of law : origin, development & Indian Constitution.legalpuja22
 
Canada PR_ Top 10 Eligibility, Requirements, and Criteria.pdf
Canada PR_ Top 10 Eligibility, Requirements, and Criteria.pdfCanada PR_ Top 10 Eligibility, Requirements, and Criteria.pdf
Canada PR_ Top 10 Eligibility, Requirements, and Criteria.pdfvisa gurukul
 
Planned Giving Presentation for Ottawa County Parks Foundation
Planned Giving Presentation for Ottawa County Parks FoundationPlanned Giving Presentation for Ottawa County Parks Foundation
Planned Giving Presentation for Ottawa County Parks FoundationP. Haans Mulder, JD, MST, CFP®
 
VIETNAM - LEGAL ALERT ON CIRCULAR PROVIDING REGULATIONS ON METHOD TO FORMULAT...
VIETNAM - LEGAL ALERT ON CIRCULAR PROVIDING REGULATIONS ON METHOD TO FORMULAT...VIETNAM - LEGAL ALERT ON CIRCULAR PROVIDING REGULATIONS ON METHOD TO FORMULAT...
VIETNAM - LEGAL ALERT ON CIRCULAR PROVIDING REGULATIONS ON METHOD TO FORMULAT...Dr. Oliver Massmann
 
16902_2015_Order_12-Apr-2019.pdfp;kp;kpodk
16902_2015_Order_12-Apr-2019.pdfp;kp;kpodk16902_2015_Order_12-Apr-2019.pdfp;kp;kpodk
16902_2015_Order_12-Apr-2019.pdfp;kp;kpodkbhavenpr
 
Exploring the Essential Elements Included in eSports Licensing Agreements
Exploring the Essential Elements Included in eSports Licensing AgreementsExploring the Essential Elements Included in eSports Licensing Agreements
Exploring the Essential Elements Included in eSports Licensing AgreementsFinlaw Consultancy Pvt Ltd
 
Digital Forensics and Evidence Gathering: A Lawyer's Approach to Phishing and...
Digital Forensics and Evidence Gathering: A Lawyer's Approach to Phishing and...Digital Forensics and Evidence Gathering: A Lawyer's Approach to Phishing and...
Digital Forensics and Evidence Gathering: A Lawyer's Approach to Phishing and...Finlaw Associates
 
Commercialization of IPR – From Lawyerperspective Strategies and Challenges...
Commercialization of IPR – From Lawyerperspective   Strategies and Challenges...Commercialization of IPR – From Lawyerperspective   Strategies and Challenges...
Commercialization of IPR – From Lawyerperspective Strategies and Challenges...vijuchowbe
 
UAE Labour Law - Brief Presentation PPT - 2017.pptx
UAE Labour Law - Brief Presentation PPT - 2017.pptxUAE Labour Law - Brief Presentation PPT - 2017.pptx
UAE Labour Law - Brief Presentation PPT - 2017.pptxhrlestars
 
Doctrine of Part Performance in Transfer of property.pptx
Doctrine of Part Performance in Transfer of property.pptxDoctrine of Part Performance in Transfer of property.pptx
Doctrine of Part Performance in Transfer of property.pptxjanayana1
 
legal-Complaint-emery-unified-assault.pdf
legal-Complaint-emery-unified-assault.pdflegal-Complaint-emery-unified-assault.pdf
legal-Complaint-emery-unified-assault.pdfE'ville Eye
 

Último (20)

Jeremey Tevebaugh Indicted for Check Forgery
Jeremey Tevebaugh Indicted for Check ForgeryJeremey Tevebaugh Indicted for Check Forgery
Jeremey Tevebaugh Indicted for Check Forgery
 
Public Health and Intellectual Property Rights
Public Health and Intellectual Property RightsPublic Health and Intellectual Property Rights
Public Health and Intellectual Property Rights
 
Biography Presentation of Manoj sharma [IPS]
Biography Presentation of Manoj  sharma [IPS]Biography Presentation of Manoj  sharma [IPS]
Biography Presentation of Manoj sharma [IPS]
 
tort pptx by Abebayehu .pdf extra contractual
tort pptx by Abebayehu .pdf extra contractualtort pptx by Abebayehu .pdf extra contractual
tort pptx by Abebayehu .pdf extra contractual
 
GS Holistic Court Opinion in Trademark Dispute
GS Holistic Court Opinion in Trademark DisputeGS Holistic Court Opinion in Trademark Dispute
GS Holistic Court Opinion in Trademark Dispute
 
1038220242024-03-11-527359.pdfKIpokpikfkkovk
1038220242024-03-11-527359.pdfKIpokpikfkkovk1038220242024-03-11-527359.pdfKIpokpikfkkovk
1038220242024-03-11-527359.pdfKIpokpikfkkovk
 
The Concept of Rule of law : origin, development & Indian Constitution.
The Concept of  Rule of law : origin, development & Indian Constitution.The Concept of  Rule of law : origin, development & Indian Constitution.
The Concept of Rule of law : origin, development & Indian Constitution.
 
Canada PR_ Top 10 Eligibility, Requirements, and Criteria.pdf
Canada PR_ Top 10 Eligibility, Requirements, and Criteria.pdfCanada PR_ Top 10 Eligibility, Requirements, and Criteria.pdf
Canada PR_ Top 10 Eligibility, Requirements, and Criteria.pdf
 
Planned Giving Presentation for Ottawa County Parks Foundation
Planned Giving Presentation for Ottawa County Parks FoundationPlanned Giving Presentation for Ottawa County Parks Foundation
Planned Giving Presentation for Ottawa County Parks Foundation
 
VIETNAM - LEGAL ALERT ON CIRCULAR PROVIDING REGULATIONS ON METHOD TO FORMULAT...
VIETNAM - LEGAL ALERT ON CIRCULAR PROVIDING REGULATIONS ON METHOD TO FORMULAT...VIETNAM - LEGAL ALERT ON CIRCULAR PROVIDING REGULATIONS ON METHOD TO FORMULAT...
VIETNAM - LEGAL ALERT ON CIRCULAR PROVIDING REGULATIONS ON METHOD TO FORMULAT...
 
16902_2015_Order_12-Apr-2019.pdfp;kp;kpodk
16902_2015_Order_12-Apr-2019.pdfp;kp;kpodk16902_2015_Order_12-Apr-2019.pdfp;kp;kpodk
16902_2015_Order_12-Apr-2019.pdfp;kp;kpodk
 
Report Centre of Policy and Legal Reform 2022.pdf
Report Centre of Policy and Legal Reform 2022.pdfReport Centre of Policy and Legal Reform 2022.pdf
Report Centre of Policy and Legal Reform 2022.pdf
 
Exploring the Essential Elements Included in eSports Licensing Agreements
Exploring the Essential Elements Included in eSports Licensing AgreementsExploring the Essential Elements Included in eSports Licensing Agreements
Exploring the Essential Elements Included in eSports Licensing Agreements
 
Digital Forensics and Evidence Gathering: A Lawyer's Approach to Phishing and...
Digital Forensics and Evidence Gathering: A Lawyer's Approach to Phishing and...Digital Forensics and Evidence Gathering: A Lawyer's Approach to Phishing and...
Digital Forensics and Evidence Gathering: A Lawyer's Approach to Phishing and...
 
Commercialization of IPR – From Lawyerperspective Strategies and Challenges...
Commercialization of IPR – From Lawyerperspective   Strategies and Challenges...Commercialization of IPR – From Lawyerperspective   Strategies and Challenges...
Commercialization of IPR – From Lawyerperspective Strategies and Challenges...
 
UAE Labour Law - Brief Presentation PPT - 2017.pptx
UAE Labour Law - Brief Presentation PPT - 2017.pptxUAE Labour Law - Brief Presentation PPT - 2017.pptx
UAE Labour Law - Brief Presentation PPT - 2017.pptx
 
Aggressive Advocate for Assault Charges
Aggressive Advocate for Assault ChargesAggressive Advocate for Assault Charges
Aggressive Advocate for Assault Charges
 
Doctrine of Part Performance in Transfer of property.pptx
Doctrine of Part Performance in Transfer of property.pptxDoctrine of Part Performance in Transfer of property.pptx
Doctrine of Part Performance in Transfer of property.pptx
 
Project Esther Qualifications for Kairos Capital
Project Esther Qualifications for Kairos CapitalProject Esther Qualifications for Kairos Capital
Project Esther Qualifications for Kairos Capital
 
legal-Complaint-emery-unified-assault.pdf
legal-Complaint-emery-unified-assault.pdflegal-Complaint-emery-unified-assault.pdf
legal-Complaint-emery-unified-assault.pdf
 

Tax plannig for an employee

  • 1. LOGO R Venkatakrishnan &Associates Chartered Accountants Offices at Chennai Bangalore Hyderabad Salem Devanahalli http://www.rvkassociates.com Tax Planning for Employee
  • 2. R Venkatakrishnan & Associates, Chartered Accountants Topics Introduction1 Salary Income2 Special Exemptions in Salary Income3 Deductions from Taxable Income4 Other Information5
  • 3. Confusions in Jan to Mar R Venkatakrishnan & Associates, Chartered Accountants How do I learn about my investment and taxes? Can I use both HRA and Home loan to save taxes? What is the max I can save on Taxes? How much tax I Need to pay this year? PPF,FD or Insurance for Tax saving? What is the mystery of 80’s in tax planning? Why did I buy that insurance thing which I never require? How much benefit I can get for my home and education loan?
  • 4. R Venkatakrishnan & Associates, Chartered Accountants 1. Introduction  Income tax:- Tax on the income earned. Income tax is an important source of revenue for government in all the countries today.  Income :- Income means some monetary returns periodically received from some definite source.  Who is supposed to pay income tax :- - An individual - A company - A firm - A HUF - A local authority - A BOI or AOP - AJP
  • 5. R Venkatakrishnan & Associates, Chartered Accountants Total Income of an Individual Assessee Particulars Amount Income from Salary 7,50,000 Income from House Property (1,50,000) Profits/Gains from Business or Profession 50,000 Income from Capital Gains 35,000 Income from other source 15,000 Gross Total Income 7,00,000 Less : Deductions under Chapter VI-A (1,20,000) Total Income 5,80,000 * The above figures are illustrative
  • 6. R Venkatakrishnan & Associates, Chartered Accountants 2. SALARY INCOME (SECTION 15,16 & 17) What is salary?  Every payment made  By employer to employee  For services rendered  Includes both monetary and non monetary facilities  Foregoing salary is salary income  Tax free salary should include the tax paid by the employer Basis of Charge  Salary is chargeable to tax when it is due to be paid whether it is paid or not  Salary is chargeable to tax when any amount is paid whether it is due or not  Arrears of salary paid to employee is chargeable to tax (in the year of receipt)
  • 7. R Venkatakrishnan & Associates, Chartered Accountants 2. SALARY INCOME contd.. Salary includes…
  • 8. R Venkatakrishnan & Associates, Chartered Accountants 2. SALARY INCOME contd.. Income from “Salary” includes Salary Allowances Fully Taxable Fully Exempted Partially Exempted Special Exemptions Perquisites Taxable Perquisites Non Taxable Perquisites Profit in lieu of salary
  • 9. R Venkatakrishnan & Associates, Chartered Accountants 2. SALARY INCOME contd.. Salary includes:  Basic salary and allowances  DA  Advance salary  Arrear Salary  Leave salary Fully Taxable Salary:  Family Allowance  Overtime, servant, warden Allowance.  Lunch or Tiffin allowance  Leave encashment during service  Monthly or uncommuted pension  Bonus  Commission  Profit in lieu of salary
  • 10. R Venkatakrishnan & Associates, Chartered Accountants 2. SALARY INCOME contd..  Travelling Allowance  Daily Allowance  Conveyance Allowance  Helper Allowance  Academic Allowance  Uniform Allowance Fully Exempted Allowances: Note: Allowances received should be expensed towards official performance of duties only. Partially Exempted Allowances: Type of Allowance Amount of Exemption (in Rs.) Children Education Allowance `100 p.m. per child (restricted to 2 children) Children Hostel Expenditure Allowance `300 p.m. per child (restricted to 2 children) Transport Allowance `800 p.m. (`1600 p.m. if the employee is blind/handicapped) Note: Partially exempted allowances mentioned above are not complete and includes other allowances mentioned in section 10(14) of the Act.
  • 11. R Venkatakrishnan & Associates, Chartered Accountants 2. SALARY INCOME contd..  Perquisites includes any amount due to or received in lump sum or otherwise, by an assessee, from an employer. Perquisites are usually attached to a position, by an organization. Perquisites Meaning:  Value of Rent free accommodation given by the Employer.  Value of Accommodation given at concessional rate.  Value of benefit given free of cost or at concessional rate.  Sum paid by employer on behalf of the employees for any obligation payable by the employee.  Value of any specified securities or sweat equity shares allocated to employee at free of cost or at a concessional rate.  Amount contributed by employer to an approved superannuation fund in excess of Rs.1,00,000/-.  Sum paid/payable by the employer towards insurance on the life of the Individual. Perquisites includes
  • 12. R Venkatakrishnan & Associates, Chartered Accountants 3.Special Salary Exemptions House Rent Allowance • The HRA exemption, that can be claimed for the Tax Exemption is minimum of the following: • Actual HRA received. • Rent paid less 10% of the Salary. • 40%/50% of Salary. • If the rent paid during the year exceeds 1 lakh, you need to submit the PAN of the landlord or declaration from landlord(if PAN not available) to employer.
  • 13. R Venkatakrishnan & Associates, Chartered Accountants 3.Special Salary Exemptions contd.. Leave Travel Assistance (LTA) • Meaning: Leave Travel Assistance may be provided by the employer to the employee and his family - • In connection with his proceeding on leave to any place in India, while in service. • Proceeding to any place in India after the retirement or termination from service. • Family of an Individual means: • Spouse and children of the Individual, and • Parents, Brothers and Sisters of the individual or any of them, wholly or mainly dependent on him. • Conditions for Benefit: • The Individual can avail the benefit of LTA offered by his employer twice in block of four years, • This exemption is available only for two children of an Individual born on or after 01.10.1998. But there is no limit in case of children born before 01.10.1998. • Amount of Exemption for LTA: • The maximum amount of exemption is the cost of travel on the shortest route. The Exemption amounts for various travelling modes are calculated in the following manner: Mode of Travel Class of Travel Amount Exempt Airways Economy Class Travel Charges on the Shortest Route collected by National Airways Train I class AC Travel Charges on the Shortest Route Recognized Transport Deluxe Class Travel Charges on the Shortest Route Other Transport - I Class AC fare as per Railways, equivalent for the distance for Shortest Route.
  • 14. R Venkatakrishnan & Associates, Chartered Accountants 3.Special Salary Exemptions contd.. Unfurnished accommodation Owned by Employer Population > 25L – 15% of Salary Population > 10L – 10% of Salary Other places – 7.5% of Salary Not owned by employer Rent paid by employer or 15% of salary, whichever is lower Accommodation in the hotel 24% of salary or actual charges, whichever is lower Furnished Accommodation Furniture owned by Employer Value of Unfurnished Accommodation + 10% p.a. of Cost of furniture Hired from Third Party Value Unfurnished Accommodation + Actual Charges Taxability of Rent Free Accommodation
  • 15. R Venkatakrishnan & Associates, Chartered Accountants 3.Special Salary Exemptions contd.. Private purpose Official Purpose Private and official purpose Car owned by the employee and expenses met by him Not a perquisite Not a perquisite Not a perquisite Car owned by the employee and expenses are reimbursed by the employer Actual Expense Less : Amount recovered Not a perquisite Actual Expense Less: Up to 1.6Ltrs 1800+900 for chauffer Above 1.6Ltrs 2400+900 for chauffer Car is owned/ hired by the employer and expenses met by the employer Actual Expense Add: Depreciation @10% / hire charges Less : Amount recovered Not a perquisite Taxable Value Up to 1.6Ltrs 1800+900 for chauffer Above 1.6Ltrs 2400+900 for chauffer Car is owned/ hired by the employer and expenses met by the employee Depreciation @10% / hire charges Less : Amount recovered Not a perquisite Taxable Value Up to 1.6Ltrs 600+900 for chauffer Above 1.6Ltrs 900+900 for chauffer Taxability of Motor Car Benefits
  • 16. R Venkatakrishnan & Associates, Chartered Accountants 4.Deductions from Taxable Income  Tax Saving Sections: Section 80C (Lots of Options discussed in detailed later) Section 80CCC (Pension Products) Section 80CCD (Approved Pension Scheme) Maximum Deduction of Rs.1,00,000/- Investment& Expenditure
  • 17. R Venkatakrishnan & Associates, Chartered Accountants Section 80C,80CCC,80CCD  The Maximum deduction available combining all the following investments/expenditures is Rs 1 Lakh.  All the investments in 80C,80CCC,80CCD can be categorized as follows: Investment Options (I) Provident Fund Public Provident Fund National Savings Certificate(NSC) Senior Citizens Savings Scheme Tax Savings Fixed Deposits Investment Options (II) Life Insurance Premium Pension plans from insurance companies New pension Scheme Tax Savings Mutual Funds Central Govt Employees Pension Scheme Expenditures Principal payment on Home loan Stamp duty and registration cost of the house Tuition Fee for 2 children
  • 18. R Venkatakrishnan & Associates, Chartered Accountants Tax Saving Sections contd..Donations Section 80G Donations to charitable funds and charitable institutions 10% on Adjusted GTI 50% or 100% of donation Section 80GGA Donations for scientific research or rural development No limit Section 80GGC Donations to political parties No limit HealthandWell being Section 80D Medical Insurance for Family and parents Deduction up to Rs.15,000/- or Rs.20,000/- Section 80DD Maintenance and medical treatment of Disabled dependent Deduction up to Rs.50,000/- or Rs.1,00,000/- Section 80DDB Treatment of Certain disease/ailment Deduction up to Rs.40,000/-or Rs.60,000/- Section 80U Physically disabled Assessee Deduction of Rs.50,000/- or Rs.1,00,000/-
  • 19. R Venkatakrishnan & Associates, Chartered Accountants Tax Saving Sections contd..Others Section 80GG Payment of rent in the place of HRA Deduction up to Rs.24,000/- Section 80CCG Rajiv Gandhi Equity Savings Scheme Deduction up to Rs.25,000/-(50% of amount invested) Section 80TTA Interest received in Savings Account Deduction up to Rs.10000/- Loans Section 80E Interest payable on education loan No limit for deduction Section 24 Interest payable on Housing loan Deduction up to Rs.1,50,000/- on housing loan Section 80EE (w.e.f. AY 2014-15) Interest payable on Housing Loan Deduction up to Rs.1,00,000/-
  • 20. R Venkatakrishnan & Associates, Chartered Accountants Rajiv Gandhi Equity Savings Scheme(RGESS)  RGESS is a new tax saving scheme which was announced in 2012 to encourage first time investors in stock market  Under RGESS, you are eligible for a tax deduction on 50% of the amount invested  The maximum amount eligible for investment in a year is 50000. So limit on max deduction is 50% of 50000=25000  You can invest in BSE-100 and CNX-100 and public sector enterprises ( Navaratna, Maharatna, Miniratna)  Mutual funds which invests only in these companies are also eligible for deduction Who can Invest in RGESS:  This scheme is for new investors to come into stock market. Encourage them to invest in stock markets.  Who didn’t have a Demat A/c on Nov 23, 2011(i.e the date on which the scheme notified.  Have not transacted in equity or derivative before the above date.  Had a demat account but as second joint holder.  Your Gross Total Income Should be less than 12L Open a Demat Account Designate the A/c as RGESS account Buy Eligible Stocks Submit Demat statement as proof to claim tax benefit Steps to claim Tax Benefit in RGESS
  • 21. R Venkatakrishnan & Associates, Chartered Accountants 5.Other Important Information Home Loan: Interest and Principal  Buying a house is one of the top most priority for most  The Good news is you get tax deduction on both principal and interest payment on your Housing Loan Home Loan Principal Deduction u/s 80C up to Rs.1 lakh Interest Deduction u/s 24 up to Rs.1.5 lakh Addl Deduction u/s 80EE up to Rs.1 lakh Deduction on Principal payment on Home Loan Deduction up to Rs 1 Lakh is allowed on the principal repayment of the housing loan if the house is self occupied or vacant. The house should be registered in the name of the assessee. (Can be Joint owner as well) The loan should be from Banks, NBFCS or respective employers. Loans taken from friends/relatives does not qualify for this deduction. The deduction is available also for people with multiple properties.
  • 22. R Venkatakrishnan & Associates, Chartered Accountants Home Loan: Interest and Principal Deduction on Interest payment on Home Loan  Deduction up to Rs.1.5Lakh is allowed on the Interest payment of the housing loan in case of single non-rented house.  Incase of rented or multiple houses there is no limit on amount of deduction.  All the rent you received will be your taxable income(Income)  Interest paid will be taken as expense(Expense)  Net amount will be considered as your Income/Loss from House Property. Additional Deduction on Interest Payment on Housing Loan A new section 80EE has been inserted w.e.f FY 2013-14, which gives additional deduction of Rs.1lakh on payment of interest on housing loan subject to following conditions: The Loan needs to be taken in the financial year 2013-14 Loan should be taken from banks or housing finance companies Loan < 25L Value of House <40L No other property at the time of loan sanction. The additional deduction on Interest payment of home loans can be claimed in FY 2013-14, in case you are not able exhaust the limit in FY 2013-14, The balance can be claimed in FY 2014-15
  • 23. R Venkatakrishnan & Associates, Chartered Accountants When?
  • 24. R Venkatakrishnan & Associates, Chartered Accountants Any Questions Prepared By: Korada Devi Vara Prasad Audit Executive –CA Final , CWA Final R Venkatakrishnan & Associates Email us at: assurance@rvkassociates.com Visit us at : http://www.rvkassociates.com
  • 25. LOGO