SECTIONS FOR TAX REBATE
Basic rules while computing deductions
Deductions cannot exceed amount of Gross Taxable Income(GTI).
Deductions not allowed from LTCG, STCG u/S 111A and Casual incomes.
Entertainment Allowance: The first deduction which you claim from salary is Entertainment Allowance. Entertainment allowance received is first included in the employee’s income and then a deduction is allowed in case of government employees, for a sum equal to 1/5th of salary (excluding all allowances, benefits and other perquisites) or Rs. 5,000, whichever is less.
Professional Tax: Tax on employment by whatever name called, levied by a State under Article 80C 276 of the Constitution shall be allowed as a deduction. [Sec. 16(iii)]
Deductions Permissible under Chapter VI-A: Certain deductions are available from the gross taxable income, under sections 80C to 80U. Important deductions are:
Deposit/Contribution to Life Insurance Premium, deferred annuity, contributions to provident fund, subscription to certain equity shares or debentures, bank deposits under notified scheme, 5 years POTD, Senior Citizen Saving Scheme,etc. [Sec. 80C]
Contribution to Pension Plan or Pension Fund of insurance companies. [Sec. 80CCC]
Contribution to notified Pension Scheme by employees of Central Government or any other employer or by any other individual. [Sec. 80CCD]
Investment in listed equity shares (w.e.f 1-4-2014) A.Y.2014-15 [or listed units of equity-oriented mutual funds] under Rajiv Gandhi Equity savings Scheme. [Sec. 80CCG]
Payment of Medical Insurance Premium (Medi-claim) or contribution to Central Government Health Scheme. [Sec. 80D]: Deductible upto a maximum of Rs. 15,000 (Rs. 20,000 in case the person insured is a senior citizen). Besides, an additional deduction upto Rs. 15,000 (Rs. 20,000 in case the person insured is a senior citizen) [The age limit for a senior citizen from A.Y.2013-14 is 60 years or more] shall be allowable in respect of medical insurance premium for parent(s). w.e.f. A.Y. 2013-14, deduction can also be availed for any payment for preventive health check-up of the assesses, his family and parents, subject to a limit of Rs. 5,000 within the aforesaid ceilings.
Expenditure on medical Treatment etc. and deposit for maintenance of handicapped dependents. [Sec. 80DD]: A deduction is allowed to compensate for any expenditure incurred by an assesses, during a year, for the medical treatment (including nursing), training and rehabilitation of one or more handicapped relatives wholly dependent on him, and for amount deposited in an approved scheme of LIC or UTI, for the benefit of a handicapped dependent. A fixed deduction of Rs. 50,000 is allowable, in aggregate for any or both the purpose specified above, irrespective of the actual amount of expenditure incurred.
Expenditure or Medical Treatment of assess/dependant relative [Sec. 80DDB]: Deduction for the amount of expenditure incurred or Rs. 40,000, whichever is less, is allowable for any year during which expenditure is actually incurred for the medical treatment of specified diseases or ailments for the assesses himself or a dependent relative. If the patient is a senior citizen the deduction allowable shall be the expenditure incurred or Rs. 60,000 whichever is less. Besides, any amount received under a medical insurance policy shall be reduced from the amount of deduction allowable.
Interest on Loan taken for Higher Education. [Sec. 80E]: Any amount paid by way of interest on a loan taken from any financial institution or any approved charitable institution for the purpose of pursing his higher education, is deduction without any limit.
Interest on Loan taken for first residential house. [Sec. 80EE]: Deduction is allowable for interest on housing loan from a bank/housing finance company, for allowable is Rs. 25, 00,000, subject to specified conditions. The deduction is allowable for A.Y. 2014-15 and A.Y. 2015-16 only.]
Donation for Charitable Purposes [Sec. 80G]: There are a number of donations in respect of which deduction is permissible under Sec. 80G. Deduction @ 50% is available for donation to Jawaharlal Nehru Memorial Fund, Prime Minister Drought Relief Fund, [National Children’s Fund] Indira Gandhi Memorial Trust or Rajiv Gandhi Foundation etc. 100% deduction is allowed for donations to National Defense Fund, Prime Minister’s National Relief Fund, [National Children’s Fund,]National Foundation for Communal Harmony, Chief Minister’s/Lt. Governor’s Relief Fund etc. Deduction is granted subject to the prescribed maximum ceiling and on furnishing of appropriate certificate from the done organization.
Donation of a sum exceeding Rs. 10,000 shall be eligible for deduction, only if it paid by a mode other than cash.
Expenditure on Rent. [Sec. 80GG]: Rent paid by an assesses not owning a house and not in receipt of house rent allowance u/s 10(13A) for residential accommodation whether furnished or unfurnished, is deductible subject to the prescribed ceilings. [w.e.f 1-4-2014, for A.Y. 2014-15]
Donations to specified institutions/associations for Research or for Rural Development [Sec. 80GGA]: Donation of a sum exceeding Rs. 10,000 shall be eligible for deduction, only if it paid by a mode other than cash.
Physical Disability [Sec. 80U]: Rs. 50,000 for disability and Rs. 1, 00,000 for severe disability.
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SECTIONS
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WHO CAN CLAIM
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YOU HAVE TO…
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MAX. DEDUCTION
( Annual )
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ANY REMARKS
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80C
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ALL TAXPAYERS
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PF, PPF, NSCs, FDs(over 5yrs,)
Insurance policies, Ulips, Pension plans, ELLS funds and kids’ school fees and repayment(principal) of home loan
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Rs.1.50 lakh
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80CCC
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ALL TAXPAYERS
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Pension Plans of life Insurance companies ; Sec.80C limit stands reduced by Section 80CCC investment .
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Rs.1,50,000
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80CCD
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(a) To own Pension Account
(b) For Own NPS Account
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(a) Rs.1,50,000
(b) Rs.50,000
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Limit of NPS is above of Rs 150000.
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80CCF
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Subscription of Long Term Infrastructure Bond
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Rs.20,000.00
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80CCG
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For persons whose taxable income is up to Rs. 10 lacs.
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Rajiv Gandhi Saving Scheme
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50% of the amount invested in specified securities. Max. Rs. 25,000/-
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Rajiv Gandhi Equity Scheme has been discontinued starting from April 1, 2017. Therefore, no deduction under section 80CCG will be allowed from AY 2018-19.
However, if you have invested in the RGESS scheme in FY 2016-17 (AY 2017-18), then you can claim deduction under Section 80CCG until AY 2019-20.
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80D
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ALL TAXPAYERS,HUFs
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Buy a medical insurance policy
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Rs.15,000; Rs.5,000 more for senior citizens
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From FY 2015-16 Rs.25,000 & for Sr. Citizen Rs.30,000
The maximum deduction available under this section is to the extent of Rs.60,000/-. (From AY 2016-17, within the existing limit a deduction of up to Rs. 5,000 for preventive health check-up is available).
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80DD
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Resident taxpayers , HUFs
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Pay for maintenance of a dependent suffering from a specified disease
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Rs. 50,000 ; Rs. 25,000 more for senior citizen
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From FY Rs.75,000
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80DDB
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Resident taxpayers , HUFs
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Pay for medical treatment of a dependent suffering from a specified disease
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Rs.40,000 ; Rs.20,000 more for senior citizen
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From FY Rs. 80,000
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80E
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All individual taxpayers
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Take a loan for higher education
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Interest fully deductible
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The deduction is available for a maximum of 8 years or till the interest is paid, whichever is earlier.
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| 80EE |
All taxpayers |
Interest on Home Loan |
Rs 100000 . For Loan amount upto Rs 2500000 and value of Property upto Rs 4000000.
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For First time buyer.Limit above Sec 24(b). |
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80G
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All taxpayers
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Donate to specified charitable institutions
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50-100% of donation depending on income and the charity’s credentials.
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From Financial Year 2017-18 onwards – Any donations made in cash exceeding Rs 2000 will not be allowed as deduction. The donations above Rs 2000 should be made in any mode other than cash to qualify as deduction u/s 80G.
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80GG
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All taxpayers
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Deduction for House Rent Paid Where HRA is not Received
This deduction is available for rent paid when HRA is not received. The taxpayer, spouse or minor child should not own residential accommodation at the place of employment.
The taxpayer should not have self-occupied residential property in any other place.
The taxpayer must be living on rent and paying rent.
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Deduction available is the minimum of:
1.Rent paid minus 10% of total income
2.Rs 5000/- per month
3.25% of total income
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For the financial year 2016-17 – Deduction calculation has been raised to Rs 5,000 a month from Rs 2,000 per month. Therefore a maximum of Rs 60,000 per annum can be claimed as a deduction.
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80QQB
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Deduction in respect of royalty or copyright income received in consideration for authoring any book of literary, artistic or scientific nature other than text book .
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shall be available to the extent of Rs. 3 lacs or income received, whichever is less.
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The assessee must be an individual resident in India who receives such income in exercise of his profession. To avail of this deduction, the assessee must furnish a certificate in the prescribed form along with the return of income.
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80RRB
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Deduction in respect of any income by way ofroyalty in respect of a patent registered on or after 01.04.2003 under the Patents Act 1970
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shall be available as-Rs.3 lacs or the income received, whichever is less.
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The assessee who is a patentee must be an individual resident in India. The assessee must furnish a certificate in the prescribed form duly signed by the prescribed authority alongwith the return of income.
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80 TTA
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ALL taxpayers
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Interest on Savings Accounts (not time deposits), available to Individuals or HUFs.
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(Max. - Rs. 10,000/-)
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80U
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(a) to an individual who suffers from a physical disability (including blindness) or mental retardation.Further,
(b)if the individual is a person with severe disability, deduction of
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Deduction of
(a)Rs.50,000/
(b)Rs.75,000/
- shall be available u/s 80U. W.e.f. 01.04.2010 this limit has been raised to Rs. 1 lakh.
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From FY 2015-16
(a) Rs 75000
(b) Rs 125000
Certificate should be obtained on prescribed format from a notified ‘Medical authority’.
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10(13A)
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Salaried taxpayers
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Live in a rented house
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Least of : HRA ; rent less 10% salary ; 50% salary ( 40% in non-metros )
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24(B)
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All taxpayers
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Take a home loan to buy , construct a house
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Rs.1.5 lakhs
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From FY 2014-15 Rs 200000
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| 87(A) |
Rebate is available only to Resident individuals |
Taxable Income upto Rs 500000 |
Rs 2000 |
From AY 2014-15 |
Source : Income Tax of India , GoI
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