IN THE PREVIOUS ARTICLE , I HAVE LISTED OUT ALL MAJOR DEDUCTIONS FOR AY 2019-20. After Budget 2019 speech , Here is summary of Income Slabs & deductions under Income Tax which will be applicable from 1-4-2020 i.e for AY 2020-21 RETURN FILLING. This chart of Deductions & Slab rates will help you to plan your Income & Investments and help you to minimize your Tax FOR AY 2020-21. Article contains List of All popular deductions with latest limits applicable to coming Income tax return filling season i.e for AY 2020-21.

This chart of Deductions & Slab rates will help you to plan your Income & Investments and help you to minimize your Tax before March 2020. This summary will cover maximum issues related to coming return filling season. I hope this will be helpful in your Tax planning.

A good news – under House property , Now 2 residential house can be claimed from AY 20-21 as self -occupied ( No notional Rent)

FINANCIAL YEAR 2019-2020 / ASSESSMENT YEAR 2020-2021

SUMMARY OF SLAB & DEDUCTIONS UNDER INCOME TAX

This chart of Deductions & Slab rates will help you to plan your Income & Investments and help you to minimize your Tax before March 2020. This summary will cover maximum issues related to coming return filling season.

CATEGORY <60 <80 >80
BASIC EXEMPTION LIMIT ₹ 2,50,000 ₹ 3,00,000 ₹ 5,00,000

A. INCOME TAX SLABS FOR FY 2019-20 / AY 2020-21

INCOME TAX SLABS FOR FY 2019-20

1. Education + Health Cess of 4%

2. Tax Rebate : Tax rebate maximum upto Rs. 12500 for Total income upto Rs. 5,00,000

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 ₹ 5,00,000 ₹ 5,00,000 ₹ 5,00,000
Tax On Total Income ₹ 12,500 ₹ 10,000 ₹ 0
Less: Rebate 87A -₹ 12,500 -₹ 10,000 ₹ 0
Actual Tax Liability ₹ 0 ₹ 0 ₹ 0
So, Effective Tax Exemption Limit At Which , There Is No Tax ₹ 5,00,000 ₹ 5,00,000 ₹ 5,00,000

B. POPULAR DEDUCTIONS UNDER INCOME TAX AVAILABLE TO ALL INDIVIDUALS

PLAN MAXIMUM DEDUCTIONS / INVESTMENTS BEFORE MARCH 2020 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 / Contributions made to certain relief funds and charitable institutions Contributions made to certain relief funds and charitable institutions (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.
Section 80E  INTEREST FOR HOME LOAN
1. SD vaule 50 lacs
2. Loan sanction in FY 16-17
3. HE SHOULD NOT OWN ANY HOUSE BEFORE
4 LOAN < 35 LACS
5 MAX 50000 OVER SECTION  24  i.e 200000
Section 80EEA  INTEREST FOR HOME LOAN
1. SD vaule 45 lacs
2. Loan sanction in FY 19-20 OR 20-21
3. HE SHOULD NOT OWN ANY HOUSE BEFORE
4 . Must not claim Deduction in 80EE
5. MAX 150000 OVER SECTION  24  i.e 200000
Section 80GGC Donations made by any individual to political parties if paid by bank mode

Limit – 100% of Donation or 10% Adjusted Total income ..Whichever is Higher

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. 50,000 Standard deduction for Assessee who has Salary/ Pension Income

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 2019-2020 / ASSESSMENT YEAR 2020-2021
<60 <80 >80
GROSS INCOME 9,35,000 10,00,000 10,00,000
DEDUCTIONS FROM INCOME LESS
STANDARD DEDUCTION 50,000 50,000 50,000
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 5,00,000 5,00,000 5,00,000
TAX ON ABOVE INCOME 12,500 10,000
REBATE AS PER 87A -12,500 -10,000
ACTUAL TAX LIABILITY 0 0 0

Author can be reached at ca.harshilsheth@gmail.com

(Article is been further updated on 06.03.2020)

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38 Comments

  1. SK JANI says:

    MY TAXABLE INCOME FROM PENSION IS RS 534200 .AFTER ALL AVAILABLE DEDUCTION FOR A.Y.20-21.MAI I CLAIM TAX REBATE FOR INCOME OF 500000 AND PAY TAX FOR 34200.MY AGE IS 65 YEARS.

  2. TANMAY RAJ SINGH says:

    DEAR SIR ,
    SECTION 80E IS FOR INTEREST ON EDUCATIONAL LOAN,HOW EVER IN YOUR ARTICLE YOU MENTION 80E FOR INTEREST ON HOME LOAN.

  3. Alok says:

    Dear Sir, i have invested in mutual fund of different schemes in FY 19-20,since i have invested in this year what will be balancesheet value i will show as on 31st narch 2020? should i put value as on 31st march 2020 or the amount invested?

  4. pankaj says:

    Excellent article.

    can you share this article in pdf file format? can be highly useful. you may use your watermark. that’s alright.

  5. shashank bhargava says:

    In A,Y 2020-21 I have paid Rs16230 towards payment of Medical Insurance of self and my family.I have also paid Rs 50335 for medical insurance of my parents(one of them is senior citizen) . Plz guide me how much rebate can I claim?

  6. NAGABHUSHANA says:

    I WANT TO INVEST IN INFRA BONDS ONLINE MARKET THROUGH MY DE MAT ACCOUNT FOR RS.20000/- . SHALL I GET U/S.80 CCF REBATE FOR RS.20000/-.

  7. SS Dhiman says:

    I am a salaried individual. My mother is undergoing treatment for malignant brain tumor from PGIMER chandigarh. I apply for reimbursement of treatment costs from my employer and get reimbursement for 70 to 80 percent of actual costs for which the employer has specially instructed mr to provide my pan details. I want to know that whether I am eligible to claim deduction under section 80ddb and also what proofs i need to retain with me for any future queries. Please provide detailed answer as I am confused about it. Thanks in advance

  8. Dipti Saxena says:

    I want to know about 80D –
    My Health insurance Policy Premium – 18000,
    In this year expenditure of medical tests – Self – Rs. 6000,
    Daughter – Rs. 4000.
    Then I want to know how much amount I will show in 80D on my ITR.

  9. Ashok Akhani says:

    I take vrs From semi gov.job.at the age of 55 year on oct-18.My query about other income due to(1) extra duty for electoral roll corrections.gov.pay us RS.1000/- per month.(2)Interest on saving with employee credit soc.(3)share dividend income (4)lic money back policy’s installment. Above income not showing in form no -16.So I want to desclose above income in filling of it returns of this year.pl.guide me that which income is exempt or taxable.

  10. MAYANK AGARWAL says:

    IF Tax payer is about 86 year old and he had no mediclam policy then can he eligible of 80 D ? if yes, then what is the limit ?

  11. neerav says:

    Dear harshilji
    Summary of Slab & Deductions under Income Tax AY 2020-21 part -B B. POPULAR DEDUCTIONS UNDER INCOME TAX AVAILABLE TO ALL INDIVIDUALS
    80C 80C => LIC / PPF / KVP / EPF / SSY / NSC / HOME LOAN PRINCIPAL / SCHOOL FEES/ ELSS/STAMP DUTY ₹ 1,50,000

    DISCUSS BRIEFLY STAMP DUTY WORD WITH ACTUAL STAMP DUTY DEDUCTIABLE AGAINST WHICH HOME LOAN/ ANY TYPE OF STAMP DUTY

  12. Dr Sandip Kadam says:

    You missed to add RS 50,000/- additional deduction under 80DD (NPS) which is over & above 80C limit. If salaried person having income of RS 9,85,000/- & age is below 60 years then tax will be zero. Plz make the correction

  13. VINAYKUMAR MARUTI SAPALE says:

    Whether u/s 80TTA exemption for interest on deposits with post office, bank, co-op. banks available. Information provided above is very very useful.

  14. S C Biswal says:

    Sir, I am Sr. Citizen getting bank interest 3.5 lakha
    For the FY 2019 (AY 2020-21) have to submit 15 H form before 31 Ist March 2019 not to deduct tax at source.
    How to fill up 15 H form not to deduct tax by bank?
    Hopping your responds will be appreciated.
    Regards

    1. YOGESH SHRIMAL says:

      No, Nishant Medical insurance is allowable on paid bases not due bases hence in which year its paid such year its claimable so your total claim amount 25000 or 50000 as your age

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