Tax saving investment options for 2012-13

Author: delfeno On: 19.07.2017

May 27, How to , Save Money. This article will help you with your income tax planning by explaining each and every provision that you can use to save your tax. The question that I am asked most often is that my income is Rs. XXXXXXX, what tax planning can I do to save tax? I have created a comprehensive list of all the provisions that you can utilize to reduce your taxable income.

Check prices and reviews of all the latest mobile phones sold in India. Returns on NPS are tax free, but withdrawal is still taxable. The deduction under sec 80CCD is over and above the deduction available under sec 80C. Max deduction allowed is Rs. All education after Class 12 is allowed, either vocational or Fulltime.

Any contribution made by a company to superannuation fund upto Rs. Any Medical Allowance given to an employee is tax free upto Rs. Provident Fund contributions under section 80 C and subject to an overall investment limit of Rs.

The investment will be subject to 3 years lock-in. The benefit will be available for 3 consecutive years. Government has notified this scheme RGESS. Mutual funds and ETFs that invest in BSE or CNX stocks or PSUs which are Navratna, Maharatna and Miniratna will qualify under this scheme. These investments can be traded over stock exchange after 1 year of investment. No tax will be charged on interest earned on balance in savings bank account subject to a maximum of Rs.

Tax rebate of Rs. Have I missed anything? Do you know any other way to save tax? Let me know in comments below. This Savings Bank Interest Clause is only meant for those who have only Salaried Income and Savings Bank Interest.

Tax on their Salary is Deducted at source by their employer and so to give them relief of not filing IT Returns this clause was introduced to make their taxable income nil. FD Interest is not eligible for deduction under this section and is fully taxable. Hi Naimisha, Thanks for this wonderful post. I want know, as a salaried employee income tax payable and having a savings bank account, is the interest taxable? I wish to know about 80D.

The insurance in question was Travel health insurance taken here with the premium paid through credit card which was paid in rupees.

Only the company was not Indian. Sorry… Travel Insurance and Medical Insurance are quite different. The Tax claim can be done only in case of genuine Medical Insurance. The issue with Travel insurance is it also takes care of Medical issues during your Travel, however it takes care of Loss during travel..

These Medical Insurance that can be claimed at 80D, has to be taken within the Taxable year, and are Available for that Complete year!. Hence can be claimed as Tax-free! However, in all probability, interest earned on FD will not qualify for deduction under this clause.

Though you have stated that the position is not fully spelt out,do you have anyfurther views. To tell bank not to deduct, this submit form 15g if you are not senior citizen otherwise form 15h. Interest earned over on SB is taxable not the entire amount. For example if is total interest earned then would be taxable.

Yes Divya, ELSS is still allowed under 80C. At least for one more year before the direct tax code gets implemented. Please Make me sure. Please give any reference if Possible for you. The deduction of Rs. You can cross check the facts on Income Tax India website http: And thank you for your appreciation. Thus tution fees can be claimed for exemption paid for the children upto two children only of assessee can be allowed as deduction upto Rs. There might be some confusion regarding the limits of tution allowance in case of salary head in your mind.

Kindly check the same. Prem, the objective behind this article is to help readers save money on their taxable income. Agriculture income, as you rightly said, is tax free and hence is outside the purview of this write-up. Thank You Ami, This is best article Published on Tax planning till date.

Can you tell me more about Medical Checkup and Interest on Bank SB account. Finance Minister, Pranabda, in his budget speech, announced exemption of additional Rs. Before this announcement, any check-ups were not covered.

Only premium towards health insurance policies was exempted subject to limits. But with this provision, we can now go ahead and get our health check up done and claim exemption on the expense, again subject to Rs. Another announcement made by Pranabda was about interest earned on savings bank account. Till last year, any interest you earn from your savings bank account was added to your total income and taxed accordingly.

However, from this year on ward, interest earned up to a max limit of Rs. Wanted to know how do I claim deduction under sec80D for preventive healthcare. Do I have to specifically go for such packages or can I claim for individual check-ups? Can I claim deduction for that under preventive health care?

Also which are the various tests that are allowed under preventive health care? Vishal, you can claim expenses for preventive health checkup for your own self. All you need to do is preserve the bills.

However, I am not sure if you can claim expenses for check-up of your mom. Also do we have to do the tests only at govt.

I see many labs offering preventive heath check-up packages. Is it mandatory that we have to opt only for such packages or can we get the individual tests done at any lab and preserve the bills? Can any one pls help with the some info. Dil always maange more.. Can you please tell, that if I have earned an interest of say Rs on my savings bank account, then while filing my IT do I need to show the interest as Rs or Rs since interest above Rs is taxable, so should i deduct from my total interest earned?

One can also save on gifting to children I guess. Can you throw some light on it. Awaiting more details from the Finance Ministry. Will keep this post updated.

Still no information on Rajiv Gandhi Equity Scheme. The last that I heard was AMFI pitching to manage this scheme.

No other details yet. And yes, that conclusion has come. You can visit this site: I have a home loan of 4 lakh taken and I am claiming the tax benefit. Now if I prepay the balance house loan principal and take another house loan to buy another flat at same city. Can u suggest some idea how to save tax in this situation. There are exemptions available under two different sections for Housing loan. Sec 80C allows deduction of upto Rs. You cannot claim deduction under sec 80C for your second house if you are not staying in it.

In all other circumstances, no deduction is allowed. However, you can claim deduction under sec 24 for the interest part even if you are not staying in that house.

However, the maximum exemption stays at 1. So even if you are paying EMI on different properties, you will be allowed exemption only up to Rs. Dear Ami, Interest on housing loan is allowed for aquistion or construction for a self occupied house. Namiksha thanks for your valuable inputs. Its very importance information and i found it very handy. Can u give a best tax planning to save tax, my salary take home is taxable 8L, i am Hey Venu, you have shared very little information to do detailed tax planning.

Point 17 above will also help but the process is not yet clear. Reply Akshay M Page May 29, 1: Please clarify so that readers get a clear idea. Akshay, we are reasaonably sure that the investment in NSC is allowed as deduction, under sec 80C, up to a max limit of Rs. You may still want to clarify with your CA. It was amazing to read all your replies, need a help from you in one of your thread about petrol exemption. Yes, both of you can claim deduction provided both of you contribute towards the EMI.

The deduction will be to the extent of individual contribution and subject to caps mentioned above. This exemption is applicable starting from FY However, interest above Rs. LTA is Leave Travel Allowance. This exemption can be claimed for expenses made on your travel in India only.

INCOME TAX RATES, DEDUCTION FY AY FOR INDIVIDUAL HUF | SIMPLE TAX INDIA

The travel should be made using the shortest route or cheapest mode. You need to maintain all bills and tickets. Hello Sriram, there is savings possible under each of the sections mentioned above. Depends on what all is applicable to you. Do read each one of them in detail and see if you can take advantage of it.

I want to know how much Rs. I get deduction under Clause 80 U of Income tax Act. Its a tricky call. You should ideally consult your CA on this. But not very sure. If your employer is not giving you travelling allowance, you will not be able to claim a deduction for the same. BTW, if possible could you please write an article where how much one has to pay tax?

I have categorized it in the following:. Also, please give us more idea on how to save tax give us all possible ways or areas where we can save tax. I know more people will be happier to know this and I am sure it would help a lot of people.

This article is meant to help in exactly what you are asking for. There are many permutations and combinations of sources of income, expenses and investments. Hence, it is difficult to give exact tax liability and savings. I just want to know that to which extent fuel reimbursement is tax free.

He is getting Rs. I just want to that is this right way or not. Fuel expense reimbursement full amount is tax free provided it is supported by bills as far as I know. Thanks for your blog. It makes the process very simple. I need guidance on Section 80 D.

Both sounded same to me. Apart from that, i would like to know whether i am eligible to take this benefit for my parents, considering i am married now.

However, since my parents have two daughters and i am owning full medical expenses for my parents. My parents are retired now starting from july. Since you claim deduction on payment of up to Rs. In case they are senior citizens, you can claim up to Rs.

I have a question. Any other way where we can save tax. Also if we sell property withing 5 years of purchase then it comes under perview of tax and we have to reverse the deduction claims in previous years.

Preventive Health Check Up Parents and Preventive Health Chec k Up Self with limit up to each. Total for 2 items Preventive Health Check Up Parents and Preventive Health Chec k Up Self with limit up to combined, therefore total is I think the deduction for preventive health check is valid for individual and only up to Rs.

Those who are drawing double Transport Allow disabled persons are eligible for double deduction of Transport Allow i. Its nice and handy article for the current year, but I still have a few questions as follows…. Does it have any maximum limit for interest paid on education loan or it is on actuals? Not considering any donation and interest paid on education loan as dont know the maximum limit.

My answers are as follows: I assume it is on actuals but not sure. I would like to know the new updates for home loan tax exemption. What are the documents required to claim deduction under 80DDB? It is clear that if the interest is upto there is no tax. However if the interest is lets say then does that mean the first is not taxed and tax should be paid only for the remaining ?

Besides, I am not authorised to calculate tax. What about the interest deemed to be accrued to the investor is o be treated in the next year? BTW your blog is well written. By googling only i discovered you. I want to ask u about whether we can claim tax-rebate for home loan principal amount and interest amount even if house is under-construction.

I have just few query on subject to said artical. V good informative article, easy to understand,really nice ,,,,,,one of the best on this topic,,,,, Keep the good work on………. I am not sure with respect to tax treatment of second housing loan.

Besides, it is also jointly help. You should consult an expert. Would like to know, what includes the definition of preventive health check up. What test are included in such health check up. Can we go for any test and claim a sum of per assese. I have home loan and I am claiming the tax exemption for that, but now I am trasferred to a different city and I am staying in a rented house. I can not claim for the principal part as I am not staying there.

But can I claim the interest part and HRA part both? IN ITR 1 Sahaj under which head I will have fill up the amount of Interest on housing loan for gettin g rebate. Is it in the column of 80 C. I am contract employee working as a consultant. How can I include this to claim refund?

As far as I understand, a consultant earning consultation fee under contract is not considered salaried and hence those provisions do not apply.

However, you can claim all expenses under business expenses. I think in case of senior citizens between years the tax rates above Rs. I am a tax assesse havinc paid excess taxes and need to get a refund of about Rs.

You will get the excess tax paid as refund. Returns should be filed before 31st July. Hi Ami Thank u vey much for the blog as it is help full to many guys who are afraid from tax planning, Its a great work done by you Excellent informative article Keep it up. Excess tax paid by you will be refunded separately. It generally takes some time which runs in years for the refund to arrive. The refund process has been quite faster now, I generally get my refunds in around 6 months time, all you need to ensure is complete documents are submitted.

This is a practical problem but still no one is raising this issue-Why? Only people in power will do things as they like? This is only a Pseudo democracy? I am placing this before you so that you can take this forward.

I am aged above 50 years. I am finding it difficult to reach my office using either thru public transport due to poor transport system and infrastructure not in tune with the the demand or two wheeler due to neck pain and diabetes and poor road conditions.

So I started using my own car and incurring fuel costs alone Rs. This is no way near the statutory exempted amount of Rs. What is the solution for this? Company HR department is not entertaining any restructure of other allowances and permitting fule Bills reimbursements only for senior management staff. To force the Income tax department to accept this view with immediate effect what are the options availble to us.

Can the ruling party memebers opposition parties , press and media play meaningful role in this regard. It is really a shame such an experienced person never acquainted himself with these kind of peoples problems and drive the officials in Finance and Taxation departments to find an amicable and logical solutions for this. He is a waste to the country. At least let us see whether this message goes into the head of the next finance minister and whther he can come out with a good statutory solution directing the employers to check the credentials of individual employees claims and allow necessary tax exemption as they are doing for certain senior cadres.

The corporate HR departments are simply turning a deaf ear to our requests to represent to the government and get the necessary justice. Even though so many cars are plying on the roads no one is raising this issue in a big way and no article by the news paper editors or media persons in this regard. I agree with you whole heartedly. Nothing in this country is mend for common man; if you are good, honest, hard working then you either cheated or if not yet get ready for the day.

See all the sections the limits are not feasible at all as per todays scenario and you are bound to pay tax Eg: If you have already invested under sec 80C, investment of additional in infra bonds will not be deductible. Rajiv Gandhi Equity Savings Scheme is under 80CCG. I guess, it will be helpful. Lockin period is 3 years. No further clarity yet. AMFI is pitching to allow mutual fund schemes under this scheme.

If the EPF contribution by your employer is already 1 lac, you cannot claim further exemption under sec 80C. It has not been decided yet whether mutual funds will be allowed under Rajiv Gandhi Equity Scheme. Hi Ami, I am a Govt. You need to claim medical expenses of 70k from your medical insurance provider I hope, you were insured.

You cannot claim it as a deduction from your income. Here is my question: Whats the allowable deduction under 80D: AMi, I am planning to buy Medical Insurance for my MOM 15k and for me as well 15K.

Basically to avoid tax.. My personal health insurance is from Royal Sundaram. I like their service. There are other good options as well. But none which I have experienced personally. Great job of compiling the deduction list. This is just a suggestion to what is other wise a neat compilation.

Hi Namisha, I would like to know wether we can avail Tax benefit for insurance paid for vehicle?? Thanks for the quick response. Can you help me with my tax planning. THANKS FOR SHARING VALUABLE INFO.

I wanted to know sec. Wise deduction benifit and i got it thank u very much. Roby, you are right. I happened to stumble upon this blog of yours and I have to really say, its a marvellous job you are doing. This information on tax exemptions is priceless and all under one roof. Really helpful for the first timers too. Keep up the good work. Slab for senior citizons also changed as 2. No cap for tution fee like Rs.

It can be claimed upto Rs. One of the rare who answered politely to even appreciations and tease. Glad some body like me still out there,, lol. Good job, Keep it up. It appears deductions for individual I think. Hope u can dig out. Hey Ramesh, sincere thanks for your appreciation of my work. There are plenty of ways to make money and I am surely using some of them to make enough myself. But this blog allows me to give back. I like to share my knowledge and help others through this blog.

Tax rules for individuals and huf are similar if not same as far as I know. I have heard about tax benefits of making a trust. But for some reason, have not been able to dig out credible info which I can share. If you can help, I will certainly add it to this post. I am a salaried employed staying in company,s acommodation at construction sites.

My wife stays at other city in a rental acommodation. I am not availing any home loan. Should I claim HRA tax exemtion by producing rent receipts to my present employer? If yes — then Last year FY I did not claim any HRA tax exemtion so it does not reflect in my Form Now I am yet to file my return for the FY Should I claim my HRA tax benefit while efiling my return? Since, the company is providing you accommodation, your salary will not have HRA component.

You will not be able to claim deduction. Thanks for all the details on various queries of readers. I am a retired person with income from pension, house rent and interest from various instruments. Please clarify on the following: Thank you very much for making an excellent publication.

As I am working in the area of Personal Investment and Tax Planning, it is very much helpful for me. Please write whether gains from the balanced mutual funds are taxable or tax free in the hands of the recipients. As per my knowledge in concerned, gains from equity mutual funds are tax free, if the same is held for more than one year. While any gains from debt mutual funds are taxable. Yes, gains from equity mutual funds are tax free. Hence, you need to get into details of each fund to understand its asset allocation which will determine its tax status.

Ami, if i am getting HRA Rs. A very good article and a lot of healthy discussion taking forward the subject and exploring the niche areas. Please keep up the good work. Two more ques; If am declaring tax exemption under 80DD ,is any proof or certificate required for dependent declaration. If yes please assist how can i get. I had already mentioned this in the article. Interest on bank savings account is deductible up to Rs.

This is a new addition from CY. IS IT TRUE THAT contribution to the NPS is exempt over and above Rs 1lac iam working for last 23 yrs in a psubank. How can my organisation join the NPS bandwagon..

Contribution to NPS is exempt over and above 1 lac 80C limit. However, the gains are taxable when you withdraw them. All government organisations are bound to contribute to NPS. Your bank would already be doing it. I want information that can i get TAX saving benefit from my current Education SAP Delphi computech having fees 1. Shekhar, the exemption can be claimed only on interest component of the loan taken for education and only if the institute is recognized by government.

Exemption for investment in infrastructure bonds under sec 80CCF has been withdrawn this year You should definitely buy yourself some medical insurance. I am 26 years old.. You should never rely on company provided insurance. What will you do when you change the company? Medical insurance does not cover all diseases for the first few years after you take it. Hence, the more you delay taking the policy in your name, the higher is the possibility that you will be denied claim for some illness as you grow older.

Depends on which company you claim your bills from. You can claim from either. I have taken medical insurance for my family from Royal Sundaram.

I have a good experience with them in terms of claim settlement and service. Deepak, the definition of political party is available on http: Hey Sindhuja, so nice of you to have pointed this out. By the way, imitation or copying in this case is the biggest form of flattery..

Hey Aam admi, please refrain from using such language. I understand your frustration but bad mouthing does not help. I want to know about Section 80TTA. Is this applicable for FY and Assessment year as i m going to file return for Assessment year and i m deducting Rs from my whole interest earned during FY while calculating Taxable income.

I m also confused about Rs limit. Pls help me out. Slab for Senior Citizen above 60 shown in this article is Tax Free 2. I was surching for a complete list of Tax Exemptions Items Saving Item. Lot of people posted IT slabs an calculatior but without showing a list of IT Exemption Details.

I am a retired senior citizen 67 and approximted TDS for is Rs. By default, TDS of Rs. However, in some cases, TDS is deducted as per law even though your income may not come under taxable bracket i.

In such case, you just need to file your returns to claim the refund. Hi Ami, Thanks for my earlier reply. But now i want to know about TDS deducted by banks on FD interest earned.

Is it inclusive of education and Higher secondary education cess? What if it is not included? Hi Ami, Thanks for earlier reply. It is the duty of bank fixed by government. Follow the above steps and file your return without any worry.

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My CTC for was 12 lacs basic is per month. I have no saving scheme but have paid for medical insurance policy. How can I save the tax and how much? You can save tax on 1 lac of your income if you invest the same under sec 80C. Various options under sec 80C are listed above. So if I open a individual NPS account …. For you to get deduction under sec 80CCD, your employer needs to make contribution to your NPS account. If your employer does not have this provision, then you by yourself cannot invest and claim.

According to the latest information available, tax deduction under sec 80CCD is allowed if the contribution is made by the employer to your NPS account. And yes, this deduction is over and above the deduction under sec 80C. For PPF, the limit is Rs. How can I claim my HRA and How much eligible to claim the HRA. If your company does not give you HRA, you cannot claim it. You need to approach your company and ask them why are they not giving it.

It is a standard part of salary. I have a home loan for own house where my parents are living and i am living at rented place.

Possible to claim both home loan and rent in TDS?? I never said that. What I have said is that from , saving interest up to will not be taxable.

Last financial year I claimed about rupees as medical reimbursement. Is of it taxable???? I have a question: After that I move in to my house purchaged on a loan. My question for your comments is that, I have two houses in joint names.. One is let out fully and in second house I myself stay along with my son. My son pays me rent so that he can benefit from HRA policy. What is my tax implication, particularly for the second house since I too reside. The house is in joint name me and my spouse.

Shubhangi, you cannot claim HRA on owned property. Additionally, the rent paid by your son will be added to your taxable income. I am not claiming HRA as I am not in service. What I would like to know is that is there any kind of benefit I could get for the house where I personally reside but also am getting rent on from my son. Do I have to add both rents for income from house property or is their some rebare I can get since I too reside in the same house.

The planning you have done is good , but it share some consequences , only portion let out to your shall be treated as rented property and distinction has to be made although segregation not done.

Thus your second house has to be segregated into two portions , one is self occupied and another is let out. Also you have the option to choose among the houses to treat as SOP, depending upon the facts of your case. I am working on contractual basis.

Income Tax Planning (Assessment Year ) - Value Research: The Complete Guide to Mutual Funds

Employer asks to raise invoice every month. Its like I am working as a consultant for my employer. However, you can show some of these expenses as business expenses and claim deduction. I recieved my pension backlog of five years from From to I had no income as this money was held up. In I started to get rental income and my pension from Since the return is being filed for — I have tp pay tax on my total salary payment.

As per the provisions given under sec 15 , Salary is charged to tax on due or receipt basis which ever is earlier , hence in your case arrears of salary has been received , which was not due earlier , thus it shall be taxable only in the year in which it is received ; although it can relate to any previous year.

Look at a Draconian law which the IT Deptt has created to enrich themselves. He is single with no family no liability own house. Every year a huge portion of his income gets deducted as TDS which is refunded by the IT department next year with interest. Still you can submit form 15G or H. It is assuming that applicaant will adjust the tax appropriatetly. This came across and it helped me a lot.

If you post any such useful article on personal finance, just mail it across. I am salaried employee and studied MBA in distance education. Is it possible to claim tax exemption for my college tution fee? Hi Ami, Thank you for the info. I am working as a Consultant. Appreciate if you could help me with these queries. Assuming that the yearly remuneration is 30 Lakhs. What will be the applicable TDS?

ELSS Mutual Funds

Is CESS and Education CESS applicable on top of the TDS? Tax shall be levied over Net taxable Income with some filthy long procedural calculations, and need to done by a professional for accuracy and escape from default. Request you to help in getting the information on paper gold , and also need to knw that paper gold is exempted,if invested in that.

Dear Ami Liked your efforts very much, would like to know how should we plan our Investments apart from Tax planing i. Your investment can either be safe but give low returns PPF, Tax saving 5 year FD or riskier ELSS but may give better returns. You have to decide based on your risk appetite. I know that yearly we can invest from to 1Lakh. My question is , is there any restriction that we have to invest same amount for the next year as we paid in previous year?

Assume that I have invested RS 10, this year. And next year can i invest more ot less than 10,? PPF comes under 80C for tax saving 2. Under PPF you can claim a deduction of maximum Rs.

There is no rule that you should invest the same amount next year 4. PPF is a better option than FD as returns are not taxable. However, lock-in is longer. If you invest in FD, deduction will be applicable for the year of investment. No deduction for next year. Really I appreciate U and your patiancy that u r answering all questions from all coreners of people. This is an excellent illustration of Tax Saving Schemes I have ever seen.

Thanks a ton for sharing such a useful information!! Prashanth, as I have replied earlier, I prefer PPF over FD as returns are not taxable though the lock-in is higher.

There is no rule to keep investing the same amount every year in PPF. Hence, you can invest 15k next year. Thirdly if you have a business income , then after consulting your financial adviser and looking to the other facts , the whole amount can be claimed under business expenditure.

First year it will be around assuming 8. Yes you are correct………. Their is a Chart displayed on Income Tax website for calculation of Interest on NSC. You can use that chart for your reference for calculation.

My annual salary is Rs. Will my contribution of Rs. Your contribution will not qualify for deduction 2. Employer contribution will be added to your income and you can claim deduction on it.

There are legal ways in which one can utilise more than one his own PAN for tax planning. They are HUF, adult children, wife etc. One can divert familt gifts etc to HUF which is a seperate tax entity under IT act and Karta of HUF can invest the funds on its behalf. Thus one can say adult unemployed children also can contribute to family income.

Hey Srinivas, this is awesome info. I should have shared this, but it completely skipped my mind. Now agricultural land can be classified under two: Does the limit of 1. Now i got a more clear picture that it wont come under 80C, Thanks for your article. Ami…… I am confused regarding surcharge So pls. Please clarify, if a person is 60 Year in Dec When he file the tax return for F. If you already have a demat account since 3 years and if you have already invested even once, you will not qualify for deduction.

Sir, For saving Income tax How much amount to be invest in Fix Deposite for 5 years. How much deduction are allowable. Please clearify the point with the examples.. I have a NPS Tier1 Account and I pay towards it annually to accumulate pension.

Under which section can I claim exeptiom for this payment made? Did the Fin Min introduce any new plans to save tax as Infra bonds under sec 80CCF is withdrawn?

Based on your calculation you say 1,00, is taxable. You still not included HRA, PF, health insurance If your company provides. After considering these facts you can plan your saving to avoid tax.

Of course saving money is not bad at all. PF contribute by me is and by company is i. Now in PF how much amount i can invest more. Thanx for updating Naimisha. Its great that u r spending ur valuable time in giving inputs.

I purchased that flat in Vizag,currently i am staying in Bangalore. Can i show the House Rent for Tax exemption as the house rents are very high in Bangalore. If you pay principal of 1 lac and interest of 1.

Principal under sec 80C up to 1 lac and interest under sec 24 up to 1. You can claim both HRA and Housing loan deduction if you live in a different city to where your purchased property is which in your case is true. You cannot claim deduction on each of them individually. Do read through the article again to understand in detail. My total taxable pay as being reflected is Rs Yours is a slightly different case as you belong to the Army and are under a few Army schemes.

You should check with a CA. You can look at SIP in HDFC Tax Saver Fund instead to claim deduction up to Rs. The monthly maintenance charges are paid my me and it contains a Municipal Tax element. Can I take exemption on the HRA?? You can give rent to your Dad for staying in his house. Do remember to collect rent receipts. You can show rent paid for claiming HRA. ECHS means Exservicemen Contributory Health Scheme. Believe rent receipts are not required below Rs.

Can I claim rebate under section 80C for FY The premium was not claimed in FY and this is the last premium of the policy. Dear Sir, My contribution towards New Pension Scheme for the FY will Rs. So, will the total amount stated above tax free??? Hi Naimisha, First would like to appreciate your work. I have confusion on my investments to save tax. Pls correct me if I am wrong. Which one do you suggest.

I agree it depends upon the commitment if someone can wait for 15yrs, but would like to know your suggestion. I have invested in NSC last year, can I show the interest amount gained in the 1 yr in this year 80C investment. How do I calculate this, please help Thanks, Lakshmi.

This blog is very informative and simply written. I had a query. I have an housing loan for which have taken insurance coverage too. I am paying the EMI for the insurance now. Can this be claimed for tax deducton? If so under which section? Loan insurance cover is an insurance cover on borrowers life. Hence, it qualifies as life insurance under sec 80C. Thanks 4 ur co-operation. Ur Article has been no doubt very clear to understand I have just started my Tax Consultancy but was in service for last 12 yrs.

Last weekend my friend ask me a question on 80G and as i do not have much data.. Q- Currently my friend pays a income tax which comes upto 10, for the year FY So when he gets a refund from the dept does he get 5, back?? I have taxable income around 1 lacs after deducting all the tax exempted allowances, and tax free slab. I read your article and could find only that almost all the tax saving investments are long terms like 5-years lock-in.

I had some plans in next years, so i dont want to lock my money for 3 or 5 years. Can i do some short term investments which can save my tax and keep my money available for next 1 or 1. I can at maximum lock in money for next 1. No tax investment has such a short lock-in. I suggest you look at taking the HRA benefit if possible. And some of my friends said showing savings in your Saving Account saves tax.

I know it sounds silly. Investing in stock market does help you save money. Please refer my post on RGESS here: You do not get any benefit for showing savings in your bank account. On a serious note, you should be looking at large companies with minimum debt and a good business model to invest in. You will not get multi-bagger returns but your money will remain safe and also grow.

Nimisha I think you are not very clear about the provisions. I guess tax planning is possible only when the provisions are clear. So if you are not sure regarding the provisions then at least stop confusing the people. There are plenty of hardcore finance blogs around explaining the provisions of tax planning in jargon-laden detail.

My intention was not to hurt you. But I appreciate some of your comments. Actually I was searching for some amendments on google n I got the link of your article on amendments. But still I think one should b specific while giving any financial advice. Wish you all the very best……!!!!!!!

I am a KVS Employee joined after , We have NPS managerial share of Rs. Whether this amount is excluded from the Rs. You can claim deduction under sec 80CCD for NPS.

This deduction is over and above Rs. Max you can claim deduction on is Rs. The remaining 99 lacs cannot be claimed as deduction and you will need to pay tax on interest income as well. Thanks naimisha… what if i will deposite this amount by different names of my siblings…and tell me the procedure how can i save the tax…. This is not the right place to discuss this. Consult a CA or a tax consultant before moving ahead. There are plenty of good tax saver funds viz.

Is it safe to have fixed deposits in Jaiprakash Associates Limited or DHFL Ltd. Because I came to know these offer better interest rates even on short term deposits like 1 year.

Company deposits are never as safe as bank deposits where there is an insurance. Therefore, the interest rate offered by them is always higher. Higher risk, higher gain. We can do saving up to 1 lac for tax saving.

Is there any other way so that we can have some more tax saving benefit means to say apart from PPF,LIC,Medical claim. Hi, I am working in software company and getting dearness allowances DA. Please send me if you get any related link. You will be able to claim deduction for your own home only.

I am assuming that the figures mentioned by you are monthly figures. I have purchased a flat which is under construction and I am paying 30k EMI every month, The possession is still 2 years. Can I show this as investment? You should look at investing in FDs or debt Mutual Funds if you want your money back in 2 years. But you cannot show it as investment. Under Section 80 C Limit the maximum limit is 1 lakhs. Is that included LIC,PPF,ULIP etc or each one has a limit of 1 lakh?

The premium amount I pay is Rs 1,11, One point I want to add regarding Home loan, ALL the STAMP DUTY and registration fee cost can be claim under 80C deduction clause. I can claim Principal and Interest of home loan. Case A if it is rented out: I need to consider the rental income and compute Annual value while deciding the income from house property. This house is considered as self occupied property and i can claim max.

If so, how can I declare a property as self occupied and still show notional rental income. The basic underlying fact is if a house is said to be self occupied, There is a cap imposed on Interest on housing loan Regarding income tax exemption for preventive health checkup, could u please clarify would sonography tests during pregnancy come under the purview of preventive health checkup?

Can we claim membership fee of any professional society related to working field of assesses for tax deduction like Donation given to these societies..? Dear Ami I appreciate the way u replied back all the quires. Can u help me? If Tds deducted on winning from game shows then again this income will be taxable under individual hands according slab rate applicable.

It is missing a main component. If you declare the house bought as Let out, then there is no limit on the interest paid. Hi Naimisha, I want to know the tax implications for equity holdings short term , around 2 Lakhs as it swings between profit and loss. Another thing is the divedends, though small gets credited directly to my savings bank ac-are the subject to tax?

You need to worry about tax implication only when you sell your equity holdings. Dividends are taxed at source and are free in the hand of investor.

Hence, no tax implication on dividends that are getting credited in your account. Thanks for your reply. Actually I trade in short terms even intraday, so quite a few buying and selling done in last 1 year, some at profit and some at loss. In that case how will i-tax be applied? Thanks a ton Naimisha. You have been really helpful. Take care and wish you all the best. Till I confused regarding 80DD. Six months back I took treatment for pulmonary embolism.

Many medical checkups have done including angiogram. Also, I have not taken any health insurance so far. Is it possible to claim as refund from paid tax. Sorry but you will not be able to claim any deduction as you have not taken any medical insurance policy. Shall I get the deduction up to Rs. I do not understand the medical terms. However, I have added the list of diseases covered under sec 80DDB above.

Hi Naimisha, I am contributing for NPS section 80CCD. As per your article, this deduction is over and above the deduction under section 80C Rs Does it mean that NPS contribution can be directly deducted from taxable income? Hi Naimisha, i need ur guidance: I purchased a house of 10 lac in year and now i am selling it in 60 lac, The circle rate has appriciated from 8 lac to 45 lac.

Means the purchaser will pay stamp duty on 45 lac. But my questions are: Is there any formula or law to calculate tax on property selling?

How much should i pay tax? Is it per month or per month? Can I get a tax exemption for the yr on this purchase. Do investments in ULIP qualify for 80 C tax exemption? Hi Naimisha, When can I file for tax returns on the savings I made between 1st April and31st March ? A lot of thanks for such a nice post … I need a valuable suggestion. Now looking for additional saving as i have reached the limit for 80C. Deduction for NPS is over and above 1 lakh allowed under 80C.

Hence, you can invest 40k more under 80C. Very good post to improve knowledge and save tax. It is not clear that the remuneration received by the retired pensioners appointed as consultants in the different departements for a fixed period of six months or one year will be treated as salaried income or income from profession? Although the designation for these Rtired people is consultant but many of them are not professionally qualified like doctor engineer advocate etc. These so called consultants are also bound to follow all the rules for attendance time punctuality etc except leave and liable for proportionate deduction in contracted remuneration for their absence from office in which they are appointed consultants.

Thish need to be clarified as now a days it has been almost essential to run the day to day show with the consultants aken from the retired personnel due to ban on fresh recruitemens. Non availability of sanction for new posts and man power escarcity. Thanks for you post as this helped me a lot but i have a concern if the annual income is above 30L what would be the ideal things i can save my tax to..

I am permanent physically handicaped with one hand and one leg both right side. Pl specify what amount I can claim as deduction? Under sec 80U you should be able to claim a deduction of Rs. My whole hearten appreciation for the work you are doing months for the readers. Here my question is — I am a salaried employee having taxable income and also a short term share trader. If I have loss in the share trading, can I adjust the same with the salary income?

For example I have a taxable salary income after all deductions will be 2,00, and TDS has deducted by the employer. At the same time I have a loss of Rs. Can I adjust the same loss in the ITR and claim for the refund? You cannot adjust your trading loss against salary income.

Though, you can carry forward your loss to the next year. Thnks for your wonderful writeup. Recently i read in TOI dt Is it like FD or equity linked where risk are more?. Is FMP operated by banks? FMP Fixed Maturity Products are not the same as FDs. They are products that have a fixed maturity date and they invest in company deposits and not bank depostis. You can invest in 1 yr, 2yrs, 3yrs, etc FMPs and these FMPs have risk grade based on type of company deposits they are investing in.

Thanks Naimisha, Could you pls inform from where to buy these FMP. Is there any other better option available to save tax on interest of FDs without holding money for long term like PPF or tax saving bonds etc. Helo M working with defence and my motnhly salary is Including Basipc pay rs, x group pay rs , class pay , DA , Hygien allownce 75 rs , LRA RS , military service pay RS , TPTL RS , Grade pay I wana to knw frm all above pay and allownce which r nt come under taxble income?

And i got ration allownce rs pm and house rent rs pm in every six month. Plz help me hope u r nt irritiating by my way of asking! My mom is a Sr. My question is that can she claim that 1 lac in her income tax returns? IF she has a medical insiurance, she can claim this amount from the company she has taken medical insurance from. Otherwise, she cannot claim it. She does not have medical insurance.

Can she put the amount in the head Medical in the IT return? She can put it under Medical Expenses provided her employer provides her Medical allowance. That too is capped at Rs. You can if you are staying in the second home and the second home is in a different city than your first home. Keep up the great work!! I have couple of question regarding deduction under Medical Expenses 1.

Can any one claim this under Medical Expenses? What if my company gives me a medical allowance of Rs. Can I still claim ? What is procedure to claim? I have to submit the bills to my company and get taxable Income reduced or have to mention at the time of filing returns?

Your company needs the bills as proof to reduce your TDS. The issue is I have changed my job this January. I am not sure whether they will accept my medical bills and approve them. What should I do? My total income from current and past employer exceeds taxable income hence I will have to show the total income from both the employers,Right? No need to submit the bills to your new employer.

Preserve them with you so that you can show them in case there is an enquiry from IT department. Is there any cap on the intrest to be tax free. Thank you for such a collabrated information. I seek your advice on TAX excemption for my housing loan and my HRA if live in a different city from the place where I own a house through housing loan. Am I exempted for HRA and also for my housing loan principle and interest.

As far as I know, no deduction of Rs. However, this deduction of Rs.

tax saving investment options for 2012-13

An employer cannot claim this deduction for his employee. Mutual funds that are eligible for deduction are called Equity Linked Saving Schemes ELSS. Some ELSS examples are as follows: HDFC Tax Saver Fund Reliance Tax Saver Fund Franklin Templeton Tax Plan. Shiv, I am no tax consultant but for last two years i have e-filed my own income tax returns. I am providing the links where you can e-file your income tax returns https: The first link is of Income tax department where you can file tax returns for free.

The last link is also free. I think other two sites charge you something for e-filing. I hope it helps you. It is just so awesome when you know that you have a community of readers who are all willing to help each other!!

I need your help. I had filled 15G form in bank so that there is no TDS deduction. Priyanka, whether income tax gets deducted from you salary depends on a lot of other factors as listed above in the article. But since you have made an investment of 55k in 5 yr FD, you will definitely get appropriate deduction for the same. And my salary is I am fresher so know very little about income Tax.

For tax exception If i have shown FD amount of 40, for 5 years, Its valid for that first year or for total 5 years. Can u please tell me about the benefit of Rs. You can spend upto Rs. Hi Naimisha, Very helpful info.

Keep up the good work!!!! I have a few doubts which are: Thanking in anticipation, Nilesh. I have income from comission up to Rs lace. So how I can save maximum income tax on above mentioned income. Kindly arrange to provide exect detail regarding aforesaid matter. I have received TDS certificate after 31st july after that there is any provision to file income tax return or not.

If I have a Medical Insurance premium for myself 6,, my mum 9, and my dad senior citizen , Does 80C include all the below exemptions: PF Employees contribution — do not see this option explicitly mentioned in your tax calculator.

Could you also clarify on 5 year FD tax saving option: Can I invest in a 5 year tax saving FD today and use it for tax exemption for all subsequent 5 yrs.

I have invested Rs. What you invest in 5 year tax saving FD this year can be claimed only in this year. You cannot claim the deduction for subsequent years. Here my question is — I am a salaried employee, I am using my car for official purpose. I am getting reimbursement for the same from the company.

Is there any limit for the same? Do you know which section belongs to this? Dear Ami, We both are in State govt job. We have taken home loan. I am Co applicant. My wife is taking tax benefit from Home loan.

Can I also take be eligible for tax benefit? I am getting pur month. I have lic premier pur month and my two son are studying in Nepal. I travel once in a year to visit them in Nepal. Sainath, you need to pay tax only on amount left over after deducting 2. Everything Else Tax Calculator Mobile Phone Reviews RSS Twitter Login. Tax Planning — How to save income tax in FY AY: There is only so much you can do to save money by optimizing your taxes. However, you can also save money by cutting down on your shopping bills.

Make sure you compare prices and buy always at the lowest price. Using discount coupons and offers can also help you reduce the cost of shopping. Hope these discount coupons help you save some additional bucks.

Related Posts Tax Planning — How to save tax in FY AY: Save 5k using Rajiv Gandhi Equity Savings Scheme RGESS — Sec 80CCG We explain Rajiv Gandhi Equity Saving Scheme RGESS in simple language and tell you how you can save an additional Rs.

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