First Equated monthly instalment (EMI) amount is to be divided into the principal and interest components. The repayment of principal amount of the loan can be claimed as a deduction under section 80C up to a maximum amount of Rs.1 lakh. The repayment of the interest portion of the EMI is also allowed as a deduction under section 24 under the head “income from house property” upto Rs.1,50,000/- for self occupied property and full amount in case of let-out property.

One should not keep any unaccounted or undisclosed money, property or income popularly known as black money. If such a disclosure is made before its detection by the Income Tax Department, the chances of being trapped in a tax raid are minimized. A tax raid may also be conducted against a person in possession of undisclosed income or property not belonging to him but to someone else. It is therefore important for a person who is in possession or in custody of someone else’s jewellery or other valuables, etc. to ensure that they are duly accounted for.

The Commerce Ministry today said it will set up a committee to recast the export-oriented unit scheme so that the scheme remain attractive even after the end of tax sops in 2011. “EOUs should be re-modeled because challenges and environment have cha

The Punjab and Haryana High Court on Monday dismissed a petition challenging tax exemption to Members of the Legislative Assembly (MLAs) of Punjab. Dismissing the petition filed by one Manmohan Singh of Ludhiana, a division bench today held that there was no illegality in the exemption from payment of tax granted to MLAs.

Is Tarun Tahiliani, one of India’s leading fashion designers, an artiste? Those who admire his creations might think so, but not the income-tax [I-T] department. It’s been almost a decade now since the I-T first objected to Tahiliani seeking tax exemption on his foreign income for being an “artiste”, and it still continues to dispute his claim.

After taxing investors for dividend stripping, the Income Tax (I-T) Department is gearing up to tax bonus stripping. Official sources say scrutiny of returns filed by companies, brokers and individuals active in the stock markets and in possession of shares revealed wide use of this mechanism to evade tax.

Premium Punch:- At present, premium payment for a life insurance policy is tax-exempt provided the premium amount is not more than 20 per cent of the sum assured. Similarly, any sum received under a life insurance policy – be it money back at regular intervals, death benefit, maturity benefits, including bonus and loyalty additions – is tax-free.

Business Processing Outsourcing (BPO) centers in India would be subjected to taxation under the new proposed Direct Tax Code (DTC) but some clarifications, especially on double taxation, were still needed, an expert said. The (tax) exception given to BPOs has to be withdrawn under section 10 (A) of Income Tax Act. There is no provision in DTC for any such extension of benefits. The BPOs can be taxed on the basis of the profit they make in India and also overall profit.

Industry body Assocham today asked the government to raise the tax exemption limit on personal income from Rs 1.6 lakh per annum to Rs 4 lakh per annum and for senior citizens up to Rs 5 lakh per annum. The industry body was giving its proposals on the draft direct taxes code which has been put in public domain by the government for comments.

The Supreme Court has decided to examine the issue of whether foreign law firms charging professional fees from Indian companies and businessmen are liable to pay income tax in the country. A bench headed by Justice S H Kapadia has issued notices to a London-based law firm on a petition filed by the Income Tax Department.