This chart of Deductions & Slab rates will help you to plan your Income & Investments for Financial Year 2018-2019 / Assessment Year 2019-2020 and help you to minimize your Tax before March 2019. List of All popular deductions with latest limits applicable to coming Income tax return filling season i.e for AY 2019-20. Please invest before March 2019. I hope this will be helpful in your Tax planning.
A. INCOME TAX SLABS FOR FY 2018-19 / AY 2019-20
This chart of Deductions & Slab rates will help you to plan your Income & Investments and help you to minimize your Tax before March 2019. This summary will cover maximum issues related to coming return filling season.
INCOME TAX SLABS FOR FY 2018-19 / AY 2019-20
1. Education + Health Cess of 4%
2. Tax Rebate : Tax rebate maximum upto Rs. 2500 for Gross Total income upto Rs. 3,50,000
CONSIDERING REBATE , LETS RECALCULATE THE MAXIMUM TOTAL INCOME AT WHICH , THERE IS NO TAX
| CATEGORY | <60 | <80 | >80 | |
| BASIC EXEMPTION LIMIT | ₹ 2,50,000 | ₹ 3,00,000 | ₹ 5,00,000 | |
| RECALCULATING THE MAXIMUM TOTAL INCOME AT WHICH , THERE IS NO TAX | ||||
| TOTAL INCOME AFTER DEDUCTIONS | ₹ 3,00,000 | ₹ 3,50,000 | ₹ 5,00,000 | |
| TAX ON TOTAL INCOME | ₹ 2,500 | ₹ 2,500 | ₹ 0 | |
| LESS: REBATE 87A | –₹ 2,500 | -₹ 2,500 | ₹ 0 | |
| ACTUAL TAX LIABILITY | ₹ 0 | ₹ 0 | ₹ 0 | |
| SO, EFFECTIVE TAX EXEMPTION LIMIT AT WHICH , THERE IS NO TAX | ₹ 3,00,000 | ₹ 3,50,000 | ₹ 5,00,000 | |
B. POPULAR DEDUCTIONS UNDER INCOME TAX AVAILABLE TO ALL INDIVIDUALS
| PLAN MAXIMUM DEDUCTIONS / INVESTMENTS BEFORE MARCH 2019 TO MINIMIZE YOUR TAXABLE INCOME & ALSO TAX | ||||
| 24 | 24 => Home loan interest | ₹ 2,00,000 | ||
| 80C | 80C => LIC / PPF / KVP / EPF / SSY / NSC / HOME LOAN PRINCIPAL / SCHOOL FEES/ ELSS/STAMP DUTY | ₹ 1,50,000 | ||
| 80CCD(1B) | 80CCD(1B) => NPS | ₹ 50,000 | ||
| 80DD | 80DD => Exp of disabled dependent | 75000/125000 | ||
| 80U | 80U => own Physical Disability | 75000/125000 | ||
| 80TTA | 80TTA => Interest on Savings Account. Only available to Persons other than Senior citizen / Very senior citizen | ₹ 10,000 | ||
| 80TTB | 80TTB => Interest on Savings Account. and Interest on deposits with Post Offices, Banks, Co-operative bank. Only available to senior citizen & Very senior Citizen | ₹ 50,000 | ||
| 80G | 80G => Donation ( Only if paid by cheque/ Bank Mode ) | 50% of Donation or 10% Total income ..W.E.IS HIGHER | ||
| 80GG | 80GG => deduction for the rent paid (Available to all Individuals except to those who gets HRA from Employment ). Eligibility will be least amount of the following :- | |||
| 1) Rent paid minus 10 percent the adjusted total income. | ||||
| 2) Rs 5,000 per month | ||||
| 3) 25 percent of the adjusted total income | ||||
| 80D | 80D => Mediclaim For self, spouse and dependent children ( Only if paid by cheque/ Bank Mode ) | 25000/50000 | ||
| Up to ₹ 25,000 [₹ 50,000 if specified person is a senior citizen or very senior citizen | ||||
| 80D | 80D => Mediclaim For Parents ( Only if paid by cheque/ Bank Mode ) | 25000/50000 | ||
| Upto Rs. 25,000 shall be allowed [Rs. 50,000 if parent is a Senior citizen / Very Senior Citizen | ||||
| Note for 80D | Within overall limit, deduction shall also be allowed up to ₹ 50,000 towards medical expenditure incurred on the health of specified person provided such person is a very senior citizen and no amount has been paid to effect or to keep in force an insurance on the health of such person. | |||
C. ALLOWANCES AND DEDUCTIONS ONLY ALLOWED TO SALARIED INDIVIDUALS
| 1 | HRA EXEMPTION | A salaried individual having a rented accommodation can get the benefit of HRA (House Rent Allowance). However, if you aren’t living in any rented accommodation and still continue to receive HRA, it will be taxable. HRA exemption available to Lower of following three |
| a.Total HRA received from your employer | ||
| b. Rent paid less 10 percent of (Basic salary +DA) | ||
| c. 40 percent of salary (Basic+DA) for non-metros and 50 percent of salary (Basic+DA) for metros | ||
| 2 | STANDARD DEDUCTION | Rs. 40,000 Standard deduction for Assessee who has Salary/ Pension Income |
| the standard deduction of Rs 40,000 replaces medical allowance of Rs 15,000 and transport allowance of Rs 1600 per month i.e. 19,200 per annum |
LET’S FIND BREAK-EVEN INCOME , WHERE YOU HAVE NO TAX TO PAY
ASSUMPTION – THESE CALCULATIONS ARE DONE KEEPING IN MIND SALARIED PERSONS
| FINANCIAL YEAR 2018-2019 / ASSESSMENT YEAR 2019-2020 | ||||
| <60 | <80 | >80 | ||
| GROSS INCOME | 7,25,000 | 8,40,000 | 9,90,000 | |
| DEDUCTIONS FROM INCOME | LESS | |||
| STANDARD DEDUCTION | 40,000 | 40,000 | 40,000 | |
| 24 | 2,00,000 | 2,00,000 | 2,00,000 | |
| 80C | 1,50,000 | 1,50,000 | 1,50,000 | |
| 80TTA | 10,000 | |||
| 80TTB | 50,000 | 50,000 | ||
| 80D | 25,000 | 50,000 | 50,000 | |
| NET INCOME WHERE THERE WONT BE ANY TAX | TOTAL INCOME | 3,00,000 | 3,50,000 | 5,00,000 |
| TAX ON ABOVE INCOME | 2,500 | 2,500 | – | |
| REBATE AS PER 87A | -2,500 | -2,500 | – | |
| ACTUAL TAX LIABILITY | 0 | 0 | 0 | |
Author can be reached at ca.harshilsheth@gmail.com
Author Bio
Whether deduction of interest on SCSS from total income under section 80TTB ( upto Rs.50000/-) is admissible for income tax calculation. May kindly eloberate.
very good.pls update with me of that type of information.
Apart from mediclaim whether the individuals are eligible for deductions up to Rs.5000/- u/s 80D expenses incurred towards lab test, medicines and preventive tests
sir this covers all deductions available from all 5 heads income.. Capital gain exemptions are specific.
Very good submission very informative n useful. One important area is missing. If one has got a capital gain, it can be reduced by opting exemptions u/s 54 EC which may reduce taxable income significantly. Thanks from Australia