Have you planned your IT for 2015-16 as per Budget?

Have you planned your IT for 2015-16 as per Budget?

Rate this post
As per Budget 2015 introduced in Parliament the Finance Minister has kept the Personal Income Tax rates unchanged for the Financial Year 2015 /2016 (Assessment Year 2016-2017). He had proposed to introduce or extend the Tax Deduction limits Under few Sections of the Income Tax Act. Let us understand all the important sections and new proposals with respect to ‘Income Tax Deductions 2015′. This list will help you in planning your taxes.

Income Tax Deductions 2015

Section 80c
The maximum tax exemption limit under Section 80C has been retained as Rs 1.5 Lakh only. The various investment avenues under this section are:

Section 80CCC
Contribution to annuity plan of LIC (Life Insurance Corporation of India) or any other Life Insurance Company for receiving pension from the fund is considered for tax benefit. The maximum allowable Tax deduction under this section is Rs 1.5 Lakh.

Section 80CCD

Employee can contribute to Government notified Pension Schemes (like National Pension Scheme – NPS). The contributions can be upto 10% of the salary (or) Gross Income and Rs 50,000 additional tax benefit u/s 80CCD (1b) is proposed in Budget 2015. In FY 2014-2015, the maximum tax exemption allowed under Section 80CCD is Rs 1 Lakh only. In Financial Year 2015-2016 or Assessment Year (2016-2017), this will be Rs 1.5 Lakh (u/s 80 CCD 1 ) and additional exemption of Rs 50,000 u/s 80CCD (1b) will be allowed. ( To claim this deduction, the employee has to contribute to Govt recognized Pension schemes like NPS)

(10% of salary is applicable for salaried individuals and Gross income is applicable for non-slaried. The definition of Salary is only ‘Dearness Allowance.’ If your employer also contributes to Pension Scheme, the whole contribution amount (10% of salary) can be claimed as tax deduction under Section 80CCD (2). The ceiling limit of 1.5 Lakh u/s 80CCD is not applicable on employer’s contribution.)
Section 80D
Deduction u/s 80D on health insurance premium will be Rs 25,000, increased from Rs 15000. For Senior Citizens it has been increased to Rs 30,000 from the existing Rs 20,000. For very senior citizen above the age of 80 years who are not eligible to take health insurance, deduction is allowed for Rs 30,000 toward medical expenditure.
Section 80DD
You can claim up to Rs 75,000 (increased from the existing Rs 50,000) for spending on medical treatments of your dependents (spouse, parents, kids or siblings) who have 40% disability. It is also been proposed to increase the limit of deduction from Rs 1 lakh to Rs 1.25 lakh in case of severe disability.
Section 80DDB
An individual (less than 60 years of age) can claim upto Rs 40,000 for the treatment of specified critical ailments. This can also be claimed on behalf of the dependents. The tax deduction limit under this section for Senior Citizens is proposed as Rs 60,000 and for very Senior Citizens (above 80 years) the limit is Rs 80,000
Section 24 (B)
You can claim upto Rs 2 Lakh as tax deduction on the home loan interest payment. If your property is a let-out one then the entire interest amount can be claimed as tax deduction.
Section 80U
This is similar to Section 80DD. (Tax deduction is allowed for the tax assessee who physically and mentally challenged).
The other sections are – Section 80E (tax deduction benefit on the interest payment of an education loan), Section 80 G (Donations), Section 80GG (when HRA is not paid by the company but you incur rental expenses) and 100% TAX DEDUCTION on contributions made to SWACHH BHARAT & CLEAN GANGA initiatives have also been proposed.
It is prudent to plan your taxes early in 2015 instead of waiting until late December 2015 (or) January 2016. I believe that the above list is useful for your Tax Planning purpose.

For Men below 60 years of age
For Senior Citizens (Age 60 years or more but less than 80 years)
For Senior Citizens (Age 80 years or more)
Income Level
Tax Rate
Income Level
Tax Rate
Income Level
Tax Rate
Rs. 2,50,000
Nil
Up to Rs. 3,00,000
Nil
Up to Rs. 5,00,000
Nil
Rs. 2,50,001 – Rs. 500,000
10%
Rs. 3,00,001 – Rs. 500,000
10%
Rs. 5,00,001 – Rs. 10,00,000
20%
Rs. 500,001 – Rs. 10,00,000
20%
Rs. 500,001 – Rs. 10,00,000
20%
Above Rs. 10,00,000
30%
Above Rs. 10,00,000
30%
Above Rs. 10,00,000
30%
The above ‘Income Tax Deductions 2015′ are applicable for Financial year 2015-2016 (or Assessment Year 2016-2017).
(Image courtesy of Stuart Miles at FreeDigitalPhotos.net)

You may also like...

Leave a Reply