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Income Tax Saving Schemes
Exemptions:
Basic : No exemption (Full taxable) Section 10 & 17 1. HRA : Exempted up to certain conduction (need to produce house rent slips) – Sec 10 2. Conveyance : Exempted up to 800 per month. – Sec 10 Professional Tax : Full exemption – Sec 16 Gratuity – Sec 10 LTA – Sec 10 Leave Encashment – Sec 10 Medical bills: Sec 17 80 C: EPF & public and voluntary PF Children education, Tuition fees NSC (National Saving Certificate) Insurance Premium (life insurance) Saving in post office Bank fixed deposits (not less than 5 years) Insurance pension scheme NSS (National Saving Scheme) 80 D: Medical insurance premium ((max Rs.10, 000/-)) 80 D D: Medical for handicapped dependants (max Rs.50, 000/-) 80 D D B: Dependent's Medical treatment / Medical specified disease (max Rs.40, 000/-) 80 E: Higher education loan repayment including therom 80 G: Donation to certain relief fund, charitable institutions 80 GGA: Donation for scientific resear & rural der 80 U: Person with disability / Deduction for permanent disability ((max Rs.50, 000/-) These are the income tax saving schemes, 1. National Savings Certificates (NSC) 2. Public Provident Fund (PPF) 3. Kisan Vikas Patra (KVP) 4. Post Office Scheme (POS) 5. Special Schemes For Retiring Person 6. Postal Life Insurance 7. Dividend Forms: Form 16: Full details of salary & Tax Gross Exemptions Deductions TDS Balance tax payments Form 12 B: Particulars regarding salaries received previous employers Form 12 C: Details of any loss under the head com for m house property Process to calculate TDS (Example & Form with example): Consolidated Salary details (Basic, HRA, Medical, Incentives, Allowances, Conveyance… ===è Total amount Less Exemption on allowances (HRS, Medical, Conveyance…) ===è Total amount of exemption Less Standard deductions (P.T, PF, LTA, Gratuity, Leave encashment…) ===è Total amount of Standard deductions Gross Total Income (Consolidated Salary - Exemption on allowances - Standard deductions) Less Deduction (80 C, 80 CC) ===è Total amount of Deduction (80 C, 80 CC) Grand Total Income (Gross Total Income - Total amount of Deduction (80 C, 80 CC)) ====è Taxable amount (based on tax slabs rates, gender & age) Tax payable Rebate Balance Tax payable + Surcharge if any Calculate for monthly tax amount Finally deducting monthly tax amount, monthly wise |