Tax Proposals of Budget-201
Finance Minister (FM) Arun Jaitley in his Budget presented on 10.07.2014 announced changes in Income tax Slab for Individual and HUF with effect from Assessment year 2015-16. In his Budget FM has raised the Income Tax Exemption Limit for Individual below 60 Years and HUF to Rs. 2,50,000 and for Senior Citizens below the Age of 80 Years to Rs. 3,00,000/- .
Further FM has increased Limit of Deduction U/s. 80C to Rs. 1,50,000/-
In this article we have analyzed tax rate chart after giving effect to Budget proposals and possible tax saving from these changes.
We have also attached a Income Tax Calculator to calculate your tax liability for Assessment year 2015-16 i.e. Financial Year 2014-15.
Download Income Tax Calculator for A.Y. 2015-16 / F.Y. 2014-15
Tax Proposals of Budget-2014 for Salaried and Retired People along with Tax Calculator
Budget – 2014 has proposed the following income tax rates
For Individuals below 60 years age (including Woman Assessees):
| Income | Tax Rate |
| Upto 2,50,000 | Nil |
| 250,000 to 5,00,000 | 10% of the amount exceeding 250,000 |
| 500,000 to 10,00,000 | Rs.25,000 + 20% of the amount exceeding 5,00,000 |
| 10,00,000 & above | Rs.1,25,000 + 30% of the amount exceeding 10,00,000 |
For Individuals aged 60 years and above but below 80 years (Senior Citizen):
| Income | Tax Rate |
| Upto 3,00,000 | Nil |
| 3,00,000 to 5,00,000 | 10% of the amount exceeding 3,00,000 |
| 5,00,000 to 10,00,000 | Rs.20,000 + 20% of the amount exceeding 5,00,000 |
| 10,00,000 & above | Rs.1,20,000 + 30% of the amount exceeding 10,00,000 |
For Individuals aged 80 years and above (Very Senior Citizen):
| Income | Tax Rate |
| Upto 5,00,000 | Nil |
| 5,00,000 to 10,00,000 | 20% of the amount exceeding 5,00,000 |
| 10,00,000 & above | Rs.1,00,000 + 30% of the amount exceeding 10,00,000 |
Plus 3% education cess on the tax calculated as above. Further, limit to get deduction under section 80C is increased to Rs. 1,50,000/- from Rs. 1,00,000/-
Now, we will study certain income scenarios based on above mentioned budget proposals.
| Person with Age of less than 60 years | ||||
| scenario – 1 | scenario – 2 | scenario – 3 | scenario – 4 | |
| Gross Total Income | 2,70,000 | 3,70,000 | 4,20,000 | 4,20,000 |
| Less:Deductions u/s. 80C Eligible upto Rs. 1,50,000/- |
0 | 1,00,000 | 1,00,000 | 1,50,000 |
| Taxable Income | 2,70,000 | 2,70,000 | 3,20,000 | 2,70,000 |
| Tax on above income | 2,000 | 2,000 | 7,000 | 2,000 |
| Less: Rebate u/s 87A | 2,000 | 2,000 | 2,000 | 2,000 |
| Tax after Rebate | 0 | 0 | 5,000 | 0 |
| Add: Education Cess 3% | 0 | 0 | 150 | 0 |
| Total Tax Liability | 0 | 0 | 5,150 | 0 |
| Person with Age of 60 years or more but less than 80 years | ||||
| scenario – 1 | scenario – 2 | scenario – 3 | scenario – 4 | |
| Gross Total Income | 3,20,000 | 4,20,000 | 4,70,000 | 4,70,000 |
| Less:Deductions u/s. 80C Eligible upto Rs. 1,50,000/- |
0 | 1,00,000 | 1,00,000 | 1,50,000 |
| Taxable Income | 3,20,000 | 3,20,000 | 3,70,000 | 3,20,000 |
| Tax on above income | 2,000 | 2,000 | 7,000 | 2,000 |
| Less: Rebate u/s 87A | 2,000 | 2,000 | 2,000 | 2,000 |
| Tax after Rebate | 0 | 0 | 5,000 | 0 |
| Add: Education Cess 3% | 0 | 0 | 150 | 0 |
| Total Tax Liability | 0 | 0 | 5,150 | 0 |
| Person with Age of 80 years or more | ||||
| scenario – 1 | scenario – 2 | scenario – 3 | scenario – 4 | |
| Gross Total Income | 5,00,000 | 5,10,000 | 6,10,000 | 6,60,000 |
| Less:Deductions u/s. 80C Eligible upto Rs. 1,50,000/- |
0 | 0 | 1,00,000 | 1,50,000 |
| Taxable Income | 5,00,000 | 5,10,000 | 5,10,000 | 5,10,000 |
| Tax on above income | 0 | 2,000 | 2,000 | 2,000 |
| Less: Rebate u/s 87A | 0 | 0 | 0 | 0 |
| Tax after Rebate | 0 | 2,000 | 2,000 | 2,000 |
| Add: Education Cess 3% | 0 | 60 | 60 | 60 |
| Total Tax Liability | 0 | 2,060 | 2,060 | 2,060 |
To calculate the tax for other scenarios, you may use the tax calculator attached herewith.
Author:
CA. Tejas K. Andharia
B. COM, F.C.A., D.I.S.A.(ICAI), D.I.R.M.(ICAI)
Bhavnagar, Gujarat
Email: [email protected]
Click here to Read Other Articles of CA Tejas Andharia
Author Bio
Sir,
A friend of mine received Rs.65 Lacs in Kerala Lottery during July 2014. TDS of 30% and Rs.5 lacs agents commission were deducted and about Rs.40 lacs was given as prize money. He is aged 75 yrs. now.
Now he has received a notice from Tax Dept to pay the Edu.Cess applicable on the above amount. He has not filed Tax Return.Is he bound to pay Educational Cess @3% and submit a return .Will there be any interest for delay?
Await your reply.
HI Sir,,
can Relief under IT Sec 89 -NOT CLAIMED during A.Y.2014-15 ,be claimed now vide A.Y.2016-17 before 31 July 2016
thank you and regards,
Rangan
a was play about 11 lakhs in casino games at nepal in fy 2011-12, all transaction used by credit card only. now notice served against me u/s 142(1) how can solve the problem.
respected sir,
i had paid tax of 2013-14 due to my mistake in chaLLAN I WROTE ASSEMENT YEAR 2014-15 AT THE PLACE OF 2015-16 AND I HAD PAID TAX ON THE DATE OF 31 MARCH,2015 NOW HOW COUKLD I WILL GET BACK MY AMOUNT
Isn’t NPS deduction exempt under SEC80CCE over the limit of 1.5 lacs? I don’t see it in the excel worksheet.
Sir,
My relative sold his property at Rs.70 lac and the buyer deducted TDS 1% from the total value. He has not
a permanent job and not a tax payer. He is working on daily wages and has not any other source of income.
Can he get refunded the amount from Income tax and what to do for that.
Please give your valued reply.
Thanks
Bineesh
HI,
As the per budget 2014, the tax slab limit under 80C is revised to 1.5 lakh, but on online portal for ITR it shows 1 Lakh only, can you please let me know the limit is 1.5 lakh or 1 lakh only for FY 2014-15
Thanks in advance for your response.
Sir,
pl. let me know if the full pension + dearness relief is to be taken for income tax calculation or the residul pension (after 40% commutted) along with the dearness relief is to be reckoned.
parthasarathy H
agricultural income 500000/-
if i want to show agricultural income in Tax return how much tax i need to pay and how it would be calculated.
Kindly let me know that how much amount I would have to pay to income tax?
Dear Sir,
I retired on 31-01-2015 from PSU service after superannuation of 60 yers on 31.01.2015. Now I need to e-file my Income Tax Return for the FY 2014-15 AY 2015-16 complying with Form-16 as per TDS deducted by the employer (Govt. of India).
Kindly let me know under what category my Tax Return should be filed — as Senior Citizen or General citizen ? Will it be automatically calculated in ITR-1 Utility on submission of my date of birth as recorded in my PAN No.?
Thanking you in anticipating your suitable rely soon = Prabir Dey
Sir, my age is 63 years, my annual income for fin. year 2014-15 is less than 3 lakh, I have no saving. Please tell me, is filing of income tax return for the assesment year 2015-16 is compesory for me?
dear sir
i got loan for hp from bank.hp is on the name of my mother.hp loan was taken on the basis of my b/s & bank loan is also on my name.
now my question to you sir what kind of impact on my b/s & on my mother b/ s?
bank loan repayment from my a/c then what will be the effect of rebate?
Hello Sir,
My Gross Salary 420000/- + Consultant Income 110000/- + agricultural income 200000/-
if i want to show agricultural income in Tax return how much tax i need to pay and how it would be calculated.
Kindly let me know that how much amount I would have to pay to income tax?
My salary monthly 36000 how can save income taxes
My salary monthly 36000 how can save income tax
MrSKDubey: It is not that simple as your question! Salary is only only aspect. Yes, all of us wants to minimize the tax. We have to consider various aspects which a financial investment consultant takes into consideration. An example some one took a huge policy but couldnot sustain to pay the premium and discontinued it. (near 50% of the new subscribers fall pray to taking/investing in instruments which are not suitalbe for them. Similary people go for housing loan with a penure of 20-25 years without worrying about the extra money required with the passage of time. But the safest and all must do is to take a pension fund (min: 1000 pm), PPF account with a minimum investment of Rs.1000 pa and ensure you will park 1.5 lakh towards the instruments that qualify for deduction u/s 80-C.
Mr.AKSingh: You have to give all inputs to compute the tax. Use the tax calculator for this. Approx: Salary – 80-C – 2,50,000(basic exemption). Then multiply by 10% as your net comes less than 5 lakhs. You are in 2.5 lakhs to 5.00 lakh btacket. After multiplying by 10% deduct Rs.2000 exemption u/s 87-A. (9880037215)
hello sir
i want to know that my salary is approx 12 laths per year so please tell
me how much
we can maximum save tax by tax planning and where i could invest our money.
Sir,My gross salary Rs6,46,884 and saving u/s 80c is Rs89097 respectively. Kindly let me know that how much amount I would have to pay to income tax?
Rashi: He has to file the return and take the exemption u/s 87A and make the taxable income as nil. He has to file the return to get the exemption u/s 87A.
Please let me know whether tax rebate the section 87A continues.???If so then a person who is having the taxable income up to 270000/- need not pay tax.
Please let me know whether tax rebate the section 87A continues.???If so then a person who is having the taxable income up to 270000/- need not pay tax. – See more at: https://taxguru.in/income-tax/income-tax-calculator-fy-201415-effect-tax-proposals-individuals.html#sthash.Ztn8FdFm.dpuf
DEAR SIR,
MY SALARY IS 25000 IN HAND WHAT IS AMOUNT I HAVE TO PAY?
THANKS FOR YOUR TIME.
Mrs.Shephali (hope no error in this): Section 80-C is a part of Chapter VI-A. Express the figures properly. Rs.75,000/= in Chpater VI-A cannot include Rs.1,50,000 u/s 80-C?!
Mr Yogesh:
As your taxable income will be less than Rs.5,00,000/- rebate u/s 87-A is applicable. Taxable income is after rebate under Ch.VI A.
my gross salary is 535284, deduction under VI A is 150000 can i get rebate u/s 87a?
Dear Sir,
My estimated income from salary during the accounting year 2014-15 would be approximately Rs. 5,75,000/-. After taking benefits from all deductions such as chapter VI-A i.e. Rs. 75,000/- and under section 80C Rs. 1,50,000/-, please let me know how much tax i will have to pay for the accounting year 2014-15.
loan amount rs 25,8000/-
cost of house for loan taken on 28 march 2014 rs 42,23,232/-
Eligible for 80EE
Provided the property is a joint holding of 3 persons, loan is sanctioned for that property and the ratio between them is 33.33% each. Max can be 1.5 x 3 = 4.5 lakhs
hello sir,
if loan interst is 300000 for finacial year 2014-15 and brrower is 3 person then full 1 l00000 benifit will get each person
Thnaks should go to TaxGuru for the platform provided. Knowledge is useless uless it is used positively.
its great to c u here with your commendable presence to help out people. regards, tapan
Mr.S.Ramamoorthy, Super Sr. Citizen: Why did you deduct Rs.3.00 lakh? You have to deduct Rs.5.00 lakh from taxable income and pay tax for the rest. i.e. for 8.00 lakh taxable salary, tax to be paid for Rs.3.00 lakh. Rs.6000 plus surcharge etc.
Mr. Naren, Section 87-A is not removed, It is in existance now and in future also!
Mr. Sa: For a salary above 4.2 lakh, you have to pay tax, unless you take housing loan whose interest upto Rs. 2.0 lakh per year is exempt now.
what are the methods to save the arrears of pay in the incometax for the FY 2014-15 for a senior citizen above in addition to the usual pension for that year
i want to know that my salary 5 lac p.a so how we pay zero income tax from new budget
Sir,
I want to know whether any change in the limit for TDS – 194i for rent received from company Lease
For my flat given to company for rent.Please clarify.
T.Selvadorai
Please tell me anyone whether direct tax credit section 87A (Rs.2000 for below 500000 taxable income) is removed from this budget or retained.
Ramamoorthy
Is not the taxable income(total income minus legitimate deductions) is the limit (whether less than five lakhs or more) and NOT the total income.
Please let me know whether tax rebate the section 87A continues.??
I will be drawing more than Rs 5 lakhs during FY 2014-15 and I am a super senior citizen.I am a central Govt.pensioner.After deducting Rs 3 lakhs from my gross income my take home pension will be well within the limit of Rs 5 lakhs provided for senior citizens in the recent budget as. general exemption.
Am I to pay any income tax over and above of Rs 5 lakhs and should I file return.
good job. keep it up.
Regarding the exemption towards Housing Loan interest from 1.5 lakh to 2.00 lakh is given in your another threada and it says…
These amendments will take effect from 1st April, 2015 and will, accordingly, apply in relation to the assessment year 2015-16 and subsequent assessment years – See more at: https://taxguru.in/income-tax/budget-2014-home-loan-interest-exemption-limit-sop-increased-rs-2-lakh.html#sthash.OUUz8EAT.dpuf…
What does it mean.?
dear sir,
will you please advice, whether mediclaim provision increased from 15000/- to ?? how much – or any similer new provision available
with reagards
ganesh bhandarkar
9870680034
Dear Sir,
Please let me know whether tax rebate the section 87A continues.???
If so then a person who is having the taxable income up to 270000/- need not pay tax.
Regards
deepak
what are the present avenues for 80C?
MrCA Sandeep Kanoi may check/get it checked once as the exemption towards Housing loan is taking without limit. The increase in the limit from 1.5 lakh to 2.00 from 2015-16 FY only.