Income Tax Deductions

9 deductions that people miss out while filing their ITR

Income Tax - Chapter VI A of the Income Tax Act, 1961 provides for various deductions that are available from the total income of an assessee while computing the taxable income. The assessees are normally aware of certain common deductions such as deduction u/s 80C in respect to contribution made towards LIC, provident fund, deduction u/s 80D for [&he...

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Section 80D Deduction in respect of health insurance premia

Income Tax - Deduction in respect of health insurance premia under Section 80D Analysis of Section 80D In case of an Individual (a) Deduction in respect of insurance premium paid for family: A deduction to the extent of ₹ 25,000 is allowed in respect of the following payments- (1) premium paid to effect or keep in force an insurance on […]...

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Deductions under Income Tax Act

Income Tax - There are different investments & expenditures which can be claimed as deduction while computing Total Income. Chapter VIA of the Income Tax Act 'Deductions to be made in computing Total Income' should must be referred before claiming any amount in Income Tax Return to ensure that the conditions mentioned therein are followed....

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Save income tax via medical expenditures under Section 80DDB

Income Tax - Section 80DDB Section 80DDB of the Income Tax Act allows you to save tax by claiming medical expenditures incurred as a deduction from income before levy of tax. You can claim this deduction if these two conditions are satisfied then one can claim a maximum deduction of Rs 50,000 in a financial year for the […]...

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Section 80E: Tax benefit for Interest on Loan taken for Higher Education

Income Tax - Section 80E- Deduction for Interest on Loan taken for Higher Education If you have taken a loan for higher studies (even though pursuing in abroad) and are repaying the same, then the interest paid on that education loan is allowed as deduction u/s 80E. However, the deduction is only available for the interest part of […]...

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Deduction U/s 35AC available only up to previous year ending 31-03-2017

Income Tax - Section 35AC of the Income Tax Act, as amended by the Finance Act, 2016, provides that no deduction under this section shall be allowed in respect of any assessment year commencing on or after 1st April, 2018. Accordingly, the benefit of deduction under section 35AC of the I.T. Act is available only up to previous year ending 31-03-2017 (...

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Govt. Plan to phase out deductions under Income-tax Act, 1961

Income Tax - Press Information Bureau Government of India Ministry of Finance 26-November-2015 09:44 IST Date for sending comments by the stakeholders and general public regarding phasing-out plan of deductions under the Income-tax Act extended till 31st December, 2015 A phasing-out plan of deductions under Income-tax Act was placed in the public doma...

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CBDT makes Claiming of medical expenditure for tax purposes easy

Income Tax - ne of the pillars of the of the taxation proposals included in the Finance Minister’s budget speech for 2015-16 was extension of benefits to the middle class. In this process the Finance Minister announced extension of certain benefits in respect of medical treatment under section 80DDB. This section allows a deduction for expenditure i...

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RGESS – Period, Income Limit Liberalised, Allowed to Invest in MF

Income Tax -  Expanding the scope of deduction and its eligibility u/s. 80CCG The existing provisions of section 80CCG, inter-alia, provide that a resident individual who has acquired listed equity shares in accordance with the scheme notified by the Central Government, shall be allowed a deduction of fifty per cent of the amount invested in such equ...

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LIC Jeevan Sugam – New Single premium plan

Income Tax - LIC’s Jeevan Sugam is a non-linked single premium plan wherein the risk cover is a multiple of premium paid by you. On maturity this plan offers a Maturity Sum Assured chosen by you....

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HC directs AO to verify claim of Section 80IB(10) deduction

DIT Exemptions Vs India Heritage Foundation Gokulam Complex (Karnataka High Court) - DIT Exemptions Vs India Heritage Foundation Gokulam Complex (Karnataka High Court) It is evident that the Assessing Officer has not made any enquiry with regard to the claim of the assessee for deduction under Section 80IB(10) of the Act. The Director of Income Tax (Exemption) in the order passed un...

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Section 80P Deduction eligible on Bonus in the nature of dividend by KMF to Co-op Society

The Mysore District Co-operative Milk Producers Society Union Ltd. Vs ACIT (ITAT Bangalore) - The issue under consideration is whether the deduction u/s 80P is allowed against the bonus received by the Co-operative Society from M/s. Karnataka Co-operative Milk Producers’ Federation (KMF)?...

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Section 80IE deduction allowable on Substantial expansion/modernization of existing industrial unit despite deduction claim U/s. section 80-IB & 10C in earlier periods

Lakshmi Ram Thakuria Vs ITO (ITAT Guwahati) - Assessee was entitled to claim deduction under section 80-IE from Financial year 2008-09 and onwards due to modernization of its plant & machinery by infusing additional capital investment by more than 25 % of initial investment in plant & machinery as envisaged in clause (iii) of sub-section 7 of s...

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Inquiry into Factual Situation required to determine Section 80P Deduction Eligibility

Peruvemba Service Cooperative Bank Limited Vs ITO (ITAT Cochin) - The issue under consideration is whether the AO need to conduct an Inquiry into Factual Situation as to activities of assessee society to determine eligibility of deduction u/s 80P?...

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No Section 80O deduction for income received from foreign enterprise for rendering services in India

Ramnath & Co. Vs CIT (Supreme Court) - Service charges received by assessees from the foreign enterprises did not qualify for deduction in view of clause (iii) of the Explanation to Section 80O as the services rendered by respective assessees were the ‘services rendered in India’ and not the ‘services rendered from India’ and mer...

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CBDT allows donations to PM cares fund through form 16

F. No. 178/7/2020-ITA-1 - (09/04/2020) - Submission of certificate for claiming deductions U/s. 80G of the Income-tax Act, 1961 in respect of donation made by an employee to Prime Minister's Citizen Assistance and Relief in Emergency Situations Fund (PM CARES FUND)...

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FAQ on Rajiv Gandhi Equity Savings Scheme (RGESS) -Section 80CCG

F. No. 1/8/SM/2012 - (05/02/2014) - Frequently Asked Questions on Rajiv Gandhi Equity Savings Scheme (RGESS) 5 February 2014 Contents I. Objectives and legal aspects of RGESS 1. What is RGESS 2. What is the objective of the Scheme?...

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S. 80D Contributory Health Service Scheme of Department of Space notified

Notification No. 6/2014-Income Tax - (15/01/2014) - Notification No. 6/2014-Income Tax In exercise of thy powers conferred by clause (a) of sub-section (2) of section 80D of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies the Contributory Health Service Scheme of the Department of Space for the purposes of the said claus...

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Section 80CCG Govt notifies Rajiv Gandhi Equity Savings Scheme, 2013

Notification No. 94/2013 - Income Tax - (18/12/2013) - Notification No. 94/2013 - Income Tax S.O. 3693 (E).- In exercise of the powers conferred by sub-section (1) of section 80CCG of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby makes the following Scheme, namely:- 1. Short title, commencement and application. - (1) This Sche...

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Sebi notifies Rajiv Gandhi Equity Savings Scheme norms

Circular No. MRD/DP/32/2012 - (07/12/2012) - Under the scheme, announced in the 2012-13 Union Budget, new investors can avail tax benefits who invest up to Rs. 50,000 in the stock market and whose gross total annual income is less than or equal to Rs. 10 lakh. The scheme was notified by the Department of Revenue, Finance Ministry on November 2...

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Recent Posts in "Income Tax Deductions"

9 deductions that people miss out while filing their ITR

Chapter VI A of the Income Tax Act, 1961 provides for various deductions that are available from the total income of an assessee while computing the taxable income. The assessees are normally aware of certain common deductions such as deduction u/s 80C in respect to contribution made towards LIC, provident fund, deduction u/s 80D for [&he...

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Posted Under: Income Tax |

Section 80D Deduction in respect of health insurance premia

Deduction in respect of health insurance premia under Section 80D Analysis of Section 80D In case of an Individual (a) Deduction in respect of insurance premium paid for family: A deduction to the extent of ₹ 25,000 is allowed in respect of the following payments- (1) premium paid to effect or keep in force an insurance on […]...

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Posted Under: Income Tax |

Deductions under Income Tax Act

There are different investments & expenditures which can be claimed as deduction while computing Total Income. Chapter VIA of the Income Tax Act 'Deductions to be made in computing Total Income' should must be referred before claiming any amount in Income Tax Return to ensure that the conditions mentioned therein are followed....

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Posted Under: Income Tax |

Save income tax via medical expenditures under Section 80DDB

Section 80DDB Section 80DDB of the Income Tax Act allows you to save tax by claiming medical expenditures incurred as a deduction from income before levy of tax. You can claim this deduction if these two conditions are satisfied then one can claim a maximum deduction of Rs 50,000 in a financial year for the […]...

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Section 80E: Tax benefit for Interest on Loan taken for Higher Education

Section 80E- Deduction for Interest on Loan taken for Higher Education If you have taken a loan for higher studies (even though pursuing in abroad) and are repaying the same, then the interest paid on that education loan is allowed as deduction u/s 80E. However, the deduction is only available for the interest part of […]...

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List of Allowances/Perquisites/Deductions available to salaried persons

If you are a salaried person, you have a right to claim the benefits of an exemptions available on your few parts of the salary components given either in the form of ‘Allowances or Perquisites’. Here is the list given of most of the common exemptions which can be availed by a salaried person on […]...

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Income Tax Saving Investments For Salaried Individuals

Many individuals who are receiving income under the head salary ask about the methods which can legally help in saving tax on salaried people. It is a fact that are not allowed to claim expenses except those specified under the Income Tax Act. Therefore, they can only invest in or claim certain expenses which are […]...

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Incentive on Purchase of Electric Vehicle on Loan

GOOD NEWS FOR ASSESSEE WHO HAD OR PLANNING TO PURCHASE ELECTRIC VEHICLE ON LOAN To encourage the purchase of ‘electric vehicle’, Govt of India had come with new incentive plan .In the union budget 2019, the government has announced an incentive for purchase electric vehicle. In the budget speech, the finance minister has state...

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Deduction in Respect of Employment of New Employees [Section 80JJAA]

I. Applicability of Section 80JJAA:- In order to promote Employee generation, deduction under section 80JJAA is given to all Assesses, whose books of accounts are required to get audited u/s.44AB. II. Quantum and Duration of Deduction under Section 80JJAA:- Where the gross total income of an assesse to whom section 44AB applies, includes ...

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House Rent Allowance – A Tax planning tool for Salaried

Generally employee submits Rent receipt and rent deed to his employer to claim exemption of tax on account of HRA however recently CBDT vide circular :08/2013 dated 10 Oct 2013 has made mandatory that If annual rent paid by the employee to his/her land lord exceeds Rs 1,00,000 per annum...

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Chapter VIA Deductions from Gross Total Income of Individuals & HUF

Deductions from the Gross Total Income of Individuals and Hindu Undivided Family Chapter VI – A Sections 80C to 80U of the Income Tax Act specifies the deductions to be made from the gross total income of an assesses. Gross total Income means the total income, under all the five heads of Income i.e. Salary […]...

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HC directs AO to verify claim of Section 80IB(10) deduction

DIT Exemptions Vs India Heritage Foundation Gokulam Complex (Karnataka High Court)

DIT Exemptions Vs India Heritage Foundation Gokulam Complex (Karnataka High Court) It is evident that the Assessing Officer has not made any enquiry with regard to the claim of the assessee for deduction under Section 80IB(10) of the Act. The Director of Income Tax (Exemption) in the order passed under Section 263 of the Act […]...

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Section 80D Deduction – Medical Insurance Premium

In the present scenario, due to arise of Covid-19, many people are purchasing Health Insurance policies. Premiums paid on such policies are eligible for deduction u/s.80D of Income Tax Act, which is discussed in detail below:- In Case of Individual:- (i) Deduction in respect of insurance premium paid for family:- Deduction to the extent o...

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Section 80P Deduction eligible on Bonus in the nature of dividend by KMF to Co-op Society

The Mysore District Co-operative Milk Producers Society Union Ltd. Vs ACIT (ITAT Bangalore)

The issue under consideration is whether the deduction u/s 80P is allowed against the bonus received by the Co-operative Society from M/s. Karnataka Co-operative Milk Producers’ Federation (KMF)?...

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Section 80EE – Analysis of The Forgotten One

The boon for the first time home buyers, the section 80EE has been reintroduced from FY 2016-17. According to which, the interest paid on loan for buying house property shall be allowed upto Rs. 50,000/-. The said deduction can be claimed over and above Rs. 2,00,000/- under section 24 and Rs. 1,50,000/- under section 80C. […]...

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Conditions for claiming Income Tax deductions under chapter VIA

Important General conditions for claiming deductions under chapter VIA of The Income Tax Act, 1961 Chapter VIA of the Income Tax Act, 1961 contain the sections under which assessee can get deductions from his income to compute total income for income tax liability purpose. Though each sections has stated or provided its separate condition...

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Income Tax Deduction allowable on Housing Loan

Article explains three Deduction Claimed on the payment of principal and Interest amount of Housing Loan which are deduction under Section 24b for Interest on Home Loan, deduction under Section 80EEA which provides deduction on Interest on house loan over and above the eligibility mentioned in the section 24 and deduction under Section 80...

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Income Tax deductions under Chapter VIA

Deductions allowed under the income tax act help you reduce your taxable income. You can avail the deductions only if you have made tax-saving investments or incurred eligible expenses. There are a number of deductions available under various sections that will bring down your taxable income. The most popular one is section 80C of Chapter...

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Deduction under Section 80C

Deductions under section 80C to 80U are allowed from gross total income to compute total income however deduction is allowed only from normal income. Deductions are not allowed from- ♣ Long term capital gains, Section 112 ♣ Casual income, Section 58(4) ♣ Short term capital gains on sale of short term equity shares or short […...

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Section 80GG Deduction on Rent Paid

Generally, Employers give an allowance for house rent as part of the salary paid known as House Rent Allowance or HRA which can be claimed as deduction by the employees for the rent paid by them. However, sometimes the employer pays the entire salary as basic salary without any bifurcation or in cases where the […]...

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Additional Deduction For Home Loan Interest

Budget 2016: In furtherance of the goal of the Government of providing 'housing for all', it is proposed to incentivise first-home buyers availing home loans, by providing additional deduction in respect of interest on loan taken for residential house property from any financial institution up to Rs. 50,000. ...

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Section 80EEA Deduction for Interest on Loan for residential property

Sec 80EEA- Deduction in respect of Interest Payable on Loan taken for residential property Assessee is an Individual and taken a loan for purchase of a residential property, here is the benefit on interest payable over and above deduction claimed u/s 24(b). The above Section 80EEA is inserted by Finance Act, 2019 w.e.f 01.04.2019. 1) [&he...

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Deduction under section 80DD, 80DDB, 80U

Section 80DD: Deduction in respect of maintenance including medical treatment of a Dependent who is person with disability. 1. Eligible Assessee: Resident Individual & HUF 2. Maximum amount of deduction: (Flat deduction irrespective of expenditure) 3. Rs. 75,000 in case of Normal disability*. 4. Rs. 1,25,000 in case of Severe...

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Section 80IE deduction allowable on Substantial expansion/modernization of existing industrial unit despite deduction claim U/s. section 80-IB & 10C in earlier periods

Lakshmi Ram Thakuria Vs ITO (ITAT Guwahati)

Assessee was entitled to claim deduction under section 80-IE from Financial year 2008-09 and onwards due to modernization of its plant & machinery by infusing additional capital investment by more than 25 % of initial investment in plant & machinery as envisaged in clause (iii) of sub-section 7 of section 80-IE....

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Section 80IBA (Affordable Housing Scheme / House For All)

After section 80-IB of the Income-tax Act, section 80-IBA shall be inserted with effect from the 1st day of April, 2017. The section was inserted by Finance Act, 2016. Where the gross total income of an assessee includes any profits and gains derived from the business of developing and building housing projects, there shall, subject to th...

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Deduction for Interest on deposits in savings account

Section 80TTA has been introduced from this Financial Year [2012-13] and it allows to an employee from his gross total income if it includes any income by way of interest on deposits (not being time deposits) in a savings account a deduction amounting to : (i) in a case where the amount of such income does not exceed in the aggregate ten...

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Guide to meet TDS / TCS Obligations for deductor/Collector

What Is TDS/TCS? Generally the person who earns the income pays tax on such income either in the form of advance tax or in the form of self-assessment tax. However, in certain situations, the person making prescribed payments is required to deduct tax from such payments (at prescribed rates) and deposit the tax so deducted […]...

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Section 80GG: Deduction in respect of Rent Paid

Section 80GG of Income Tax Act, 1961 (Deduction in respect of Rent Paid) According to Section 80GG an individual can claim deduction of expenditure incurred in respect of furnished or unfurnished accommodation occupied by such individual for the purpose of his/her own residence to the extent as allowed by income tax department subject to ...

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Section 80M- Deduction – Inter-corporate dividends

Salient Features on Deduction us 80M with other ancillary aspects of the Income Tax Act, 1961 Amidst high expectations the Finance Bill, 2020 was presented by Hon’ble Finance Minister before The House of Parliament on 1st February 2020. The Finance Bill, 2020 proposes 104 amendments including Re-Taxation of Dividend Income in the hands ...

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Section 80C, 80CCC, 80CCD deduction (Rs. 1,50,000+50,000)

Deduction under Section 80C, Section 80CCC, Section 80CCD (Maximum amount of Income Tax deduction Rs. 1,50,000+Rs. 50,000) Deduction under Section 80C In order to calculate total income of an Individual & HUF certain payments are very important to claim deduction u/s 80. Hence to know about which type of payment that are eligible to d...

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Deduction in respect of Health Insurance Premium (section 80D)

Deduction in respect of Health Insurance Premium (Section 80D) Everybody knows medical emergencies can occur at any time or at any age in the life of any individual and nobody can guess about these emergencies so it is very safe to take health insurance policy. And in order to promote these policies government take very […]...

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Analysis of NPS, ELSS, PPF Investment u/s. 80C of Income Tax

Individuals who are employed and contributing to NPS would enjoy tax benefits on their own contributions as well as their employer’s contribution as under...

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An overview on different types of Income Tax Deductions in India

Income tax can be defined as the percentage of your income which you pay to the government in order to fund infrastructural development. Taxes account for a major portion of the income which is earned by the Indian government. In most cases these taxes can prove to be very harsh on the taxpayer. Hence the government has made some provisio...

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Buy Health insurance for you and your family to save tax

Section 80D provides a deduction for contribution towards the health insurance premium to the extent of Rs 15,000 paid for self and family. If the policyholder is a senior citizen, the benefit can increase to Rs 20,000. Mostly people take only this benefit into account and consider the maximum limit here to be the highest amount that can ...

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Inquiry into Factual Situation required to determine Section 80P Deduction Eligibility

Peruvemba Service Cooperative Bank Limited Vs ITO (ITAT Cochin)

The issue under consideration is whether the AO need to conduct an Inquiry into Factual Situation as to activities of assessee society to determine eligibility of deduction u/s 80P?...

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Tax Saving Investment Options & Deductions for Individual & HUF

Tax Saving Investment Options and Deductions under Income Tax for Individual and HUF I have brief the deductions available to Individual and Hindu Undivided Family for Assessment Year 2020-21. To claim deduction in any year, it is necessary to invest in that year. Due to Covid Pandemic, Govt. has extended the date to 31.07.2020 for [&hell...

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Section 80CCD- Deduction for National Pension Scheme Contribution

Deduction under Section 80CCD for National Pension Scheme Contribution is one of the most popular deduction. Many users take advantages of this deduction at the time of filing of their Income tax Return....

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Utility for computation of Deduction of Rent for Non-Salaried Individuals – 80GG

Rent Deduction U/s 80GG Utility Section 80GG, of Income Tax Act 1961-2020 An assessee  not being person claiming deduction of House Rent Allowance (HRA) or by whatever name its called u/s 10(13A) is eligible to claim deduction under this section. Conditions to be met for this deduction : Assessee or his spouse or minor child […]...

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Myths and misconceptions about Personal Income tax

Gifts received: Gifts received from specified relatives are exempt from income tax, and there is no upper limit also. Similarly, gifts of any amount and from anyone received during your marriage are totally tax-free. Similar is the case with the gifts received under a Will or by way of an inheritance, or from a registered charitable or e...

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No Section 80O deduction for income received from foreign enterprise for rendering services in India

Ramnath & Co. Vs CIT (Supreme Court)

Service charges received by assessees from the foreign enterprises did not qualify for deduction in view of clause (iii) of the Explanation to Section 80O as the services rendered by respective assessees were the ‘services rendered in India’ and not the ‘services rendered from India’ and merely having a contract with a foreign ent...

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Section 80D Deduction & Tips for buying Health Insurance Plan

Deduction Under Section 80D In Relation To Health Insurance Premium/Medical Expenditure & A Few Important Points To Be Kept In Mind Before Investing In A Health Insurance Policy! Medical or Health Insurance is gaining popularity in India these days. After the spread of COVID-19 pandemic, having a health insurance policy has become...

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Comparison of Deduction under section 80TTA & 80TTB

Extract of Section – 80TTA – Deduction in respect of interest on deposits in savings account 80TTA. (1) Where the gross total income of an assessee (other than the assessee referred to in section 80TTB), being an individual or a Hindu undivided family, includes any income by way of interest on deposits (not being time [&hellip...

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All about NPS (National Pension Scheme) of Section 80CCD(1B)

All about NPS (National Pension Scheme) of Section 80CCD(1B) of the Income Tax Act, 1961 With this article, I am going to answer a few questions which come in your mind before making a proactive investment in NPS (National Pension Scheme) along with the deduction under section 80CCD(1B). Q 1. What does Section 80CCD talk […]...

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All about form 15CA & Form 15CB

What stand customer can take if Bank demand Form 15CA but service is not taxable? In such cases, the possible recourse is to submit a declaration in form of a note to Bank stating the nature of remittance and reason as to why it is not chargeable to tax and consequently exempted from the submission of Form 15CA. ...

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Section 80G Deduction For Donation made

The amount donated towards charity attracts deduction under section 80G of the Income Tax Act. Section 80G has been in the law book since financial year 1967-68 and it seems it's here to stay. Several deductions have been swept away but the tax sop for donations appears to have survived the axe. The main features of tax benefit with respe...

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Tax Deduction/Collection Account Number (TAN)

Article discusses about Meaning/ Structure/ Relevance of TAN, Persons liable to apply for TAN, Consequences of not quoting TAN, Procedure to obtain TAN, Places from where to obtain Form 49B, Authority empowered to allot TAN, Procedure for online TAN application....

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Tax benefit on Insurance Premium, Mediclaim & Medical Expenses

Article discusses about Deduction in respect of Life Insurance Premium, PPF, NSC, etc. [Section 80C]/ medical insurance premium [Section 80D]/ expenditure on training/ medical treatment of a dependent, being a person with disability [Section 80DD]/ expenditure on medical treatment of specified diseases [Section 80DDB], Amount of deduction...

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Section wise Income Tax Deductions for AY 2021-22/ FY 2020-21

In this article we have discussed Income Tax deduction available to Taxpayers from various sources of Income for A.Y. 2021-22 / F.Y. 2020-21 and subsequent Years. Deductions include deduction Against Salaries, Against ‘income from house properties‘, Against ‘profits and gains of business or profession‘ Against R...

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Section 80JJAA Deduction In Respect of Employment of New Employees

ANALYSIS OF SECTION 80JJA A. Applicability of Section 80JJA 1. This section applicable to all assesses i.e. corporate and non-corporate assessee. It is also applicable to non-resident carrying on business in India. 2. This section applies to any assessee to whom section 44AB applies i.e. applicable to a person who is required to get his [...

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Countrywise Withholding Tax rates as per IT Act vis a vis Tax Treaties/DTAA

Certain income of non-resident, inter-alia, dividend, interest, royalty or fees for technical services shall be taxable as per the rates prescribed under the Income-tax Act or as per the rates prescribed under the DTAAs, whichever is more beneficial to such non-resident. ...

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Section 80EEB deduction for interest on Loan for Purchase of Electric Vehicle

Section 80EEB deduction for interest on Loan for Purchase of Electric Vehicle- Section 80EEB as introduced by Finance Act, 2019. Q 1. Who is eligible to get benefit under Section 80EEB? Ans: An Individual who has taken a Loan for purchase of an Electrical Vehicle from any Financial Institution. Q 2. What is the benefit […]...

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Section 80EEA Deduction of Interest on home Loan (Affordable Housing)

Section 80EEA Deduction in respect of Interest paid on Loan Taken for Acquisition of Residential House Property (Affordable Housing) {Sec. 80EEA as introduced by Finance Act, 2019.} Q 1. Who is eligible to get benefit under this Section 80EEA? Ans: An Individual who has taken a Loan for acquisition of residential house property from any [...

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Section 80IB deduction allowable only on Income having direct nexus with developing a housing project

Satern Griha Nirman Pvt. Limited Vs ITO (ITAT Kolkata)

The issue under consideration is that whether the disallowance made by the Assessing Officer on account of assessee’s claim for deduction under section 80IB(10) of the Income Tax Act, 1961 in respect of interest received amounting to Rs.11,10,810/- and other income amounting to Rs. 6,36,746/- is correct or not?...

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Tax Deducted at Source (TDS): FAQs

1) Whether capitalization of interest payable attracts TDS U/S 194A? Whether conversion of out standing interest on loan into loan attracts TDS? Difference between Form-15G and Form-15H? Difference between TDS and TCS? What is due date for remittance of TDS certificates? (Form-16 and Form-16A)...

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Tax benefits from Investment in Mutual Funds

Let me begin by describing the meaning of a Mutual Fund. It is a financial product that pools money of different individuals and invests on their behalf into various assets such as equity, debt or gold as per the objective of the scheme. Based upon the investor’s financial goals and risk appetite, there are several funds to choose from....

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Taxation of Cooperative Societies under Direct & Indirect Tax

U/s 2(19) of the Income Tax Act 1961, ‘cooperative society’ means a cooperative society registered under the Cooperative Societies Act, 1912 (2 of 1912), or under any other law for the time being in force in any State for the registration of the cooperative societies....

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Section 80JJAA 2.0: Old Wine in a New Bottle or New Wine in a New Bottle?

This article makes an attempt to analyse the new provisions of section 80JJAA introduced vide Finance Act 2016 and the issues in implementing the said provisions in practice. Historical Background The erstwhile section 80JJAA of the Income Tax Act 1961 (‘the Act’) was introduced vide Finance Act 1998 (No.2). The said section was intro...

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Deductions in respect of Profits and Gains from Housing Projects

Deductions in respect of Profits and Gains from Housing Projects (Section 80-IBA)- In order to provide impetus to affordable housing sector to achieve the larger objective of 'Housing for All', section 80-IBA has been inserted....

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Section 80IC deduction allowed for service charges based on direct nexus between service rendered & product

Xalted Information Systems Pvt. Ltd. Vs ITO (ITAT Banglore)

The issue under consideration is that whether deduction u/s 80-IC will be allowed against service charges since services rendered were part of business and also involved manufacturing activity?...

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Section 80D Tax deduction for Mediclaim Insurance & Medical expenditure

Taking medical insurance has become extremely relevant in the current days and medical expenditures for purchase of medicines for life style diseases have also started becoming a regular expenditure especially for senior citizens. Medical expenditure can cover even the  hospitalization expenses also of the senior citizen. The Income Tax ...

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Disability based deductions under Section 80DD & Section 80U

Article explains Deduction under Section 80DD: Expenses for Dependent Relative or Provision for the Same (Depends On Expenses Incurred / Contribution Made) and under Section 80U: For Disability of the Assessee Herself or Himself (Does Not Depend On Expenses Incurred/ Contribution Made). 1. Section 80DD: Expenses for Dependent Relative or ...

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Posted Under: Income Tax |

Section 80CCD Deduction in current and New Tax Regime

Deduction u/s 80CCD in Current and New Tax Regime and Maximum Exemption Limit for Employer’s Contribution A new regime of Income Tax for individuals and HUFs was announced in Budget 2020 which is applicable from A.Y. 2021-22 (relevant to F.Y. 2020-21). The concessional slab rates were introduced by insertion of new section 115BAC. Howev...

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Posted Under: Income Tax |

Section 80 IBA | Affordable Housing Scheme | Income Tax Deduction

Sub: Opinion on Section 80-IBA of Income Tax Act, 1961 (i.e Affordable Housing Scheme) (I) Facts of the Case: Brief Description on Section 80-IBA of Income Tax, 1961 (Housing For All) Scheme. (II) Analysis : Provisions of Section 80- IBA of Income Tax Act, 1961: (1) Deduction of 100% profits to Affordable Housing Projects: Where […...

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Posted Under: Income Tax |

Tax Treatment of Co-operative Credit Society

Co operative Credit society providing banking or credit facility to its members is taxable under section 80P or not? Meaning and Definitions: 1) Meaning of Co operative Society: Section 2(19) of IT Act, 1961: ‘Cooperative Society’ means a co-operative society registered under the Co-operative Societies Act, 1912 (2 of 1912), o...

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Posted Under: Income Tax |

PM Cares Fund – Tax Benefits and All You Wanted To Know About

The Taxation and other laws (Relaxation of certain provisions) Ordinance , 2020 has made amendments to section 80G of the Income tax act, 1961 thereby making contributions to this PM Cares fund eligible for 100% deduction under Section 80G(1) read with clause (iiia) of section 80G(2)....

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Posted Under: Income Tax |

CBDT allows donations to PM cares fund through form 16

F. No. 178/7/2020-ITA-1 (09/04/2020)

Submission of certificate for claiming deductions U/s. 80G of the Income-tax Act, 1961 in respect of donation made by an employee to Prime Minister's Citizen Assistance and Relief in Emergency Situations Fund (PM CARES FUND)...

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Section 80G No deduction if donation in cash exceeds Rs. 2000

A new clause has been added to sub-section (5C) of Section 80G vide Finance Bill 2012 where no deduction shall be allowed under this section in respect of donation of any sum exceeding ten thousand rupees, unless such sum is paid by any mode other than cash. As per the new sub-section (5D) to Section 80G any payment exceeding a sum of ten...

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Posted Under: Income Tax |

Donation to PM CARES Fund -100% deduction- Section 80G

A special fund ‘Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES FUND)’ has been set up for providing relief to the persons affected by the outbreak of Coronavirus. Contribution towards PM CARE Fund was eligible for 50% deduction in view of it being notified under section 80G(5), as again...

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Posted Under: Income Tax |

Section 80D Deduction for health insurance premium

It is proposed to amend this section 80D to include any payment made by an assessee on account of preventive health check-up of self, spouse, dependant children or parents(s) during the previous year as eligible for deduction within the overall limits prescribed in the section. However, the proposed deduction on account of expenditure on...

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Posted Under: Income Tax | ,

Taxation of NPS & Return From the Scheme

NPS is entitled to get additional tax benefit up to Rs.50,000 in a financial year u/s 80CCD (IB) of Income Tax Act which is over and above the deduction of Rs. 1,50,000 available u/s 80C /80CCE of Income Tax Act. Earlier the tax-free withdrawal on retirement were allowed up to 40% of corpus, which has been increased to 60%. ...

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Posted Under: Income Tax |

New Section 80JJAA Deduction for Salaries paid to New Employees

The Government of India, to promote employment generation activities, had introduced Section 80JJAA under Chp. VIA of Income Tax Act, 1961 which allows for deduction in respect of employment of new employees. Section 80JJAA enables an employer to enjoy tax sops or you can say – cashback for payment of salaries to new employees employed ...

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Posted Under: Income Tax |

Section 80JJAA: Tax incentive for employment generation

The existing provisions of Section 80JJAA provide for a deduction of thirty percent of additional wages paid to new regular workmen in a factory for three years. The provisions apply to the business of manufacture of goods in a factory where 'workmen' are employed for not less than three hundred days in a previous year. ...

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Posted Under: Income Tax |

Section 80D CGHS benefit extended to other similar schemes

The existing provisions of section 80D, inter alia, provide that the whole of the amount paid in the previous year out of the income chargeable to tax of the assessee, being an individual, to effect or to keep in force an insurance on his health or the health of the family or any contribution made towards ...

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Posted Under: Income Tax |

Section 80D deduction on GST on health insurance premium

Mr X has paid a health insurance premium amounting to INR 11,800 which included GST of INR 1800.Whether, Mr X be eligible for a deduction under section 80 D of the Income Tax Act,1961 of entire INR 10000/-(i.e., health insurance premium excluding GST) or for entire amount of INR 11800. Ans: Section 80 D of […]...

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Posted Under: Income Tax |

Get HRA rebate till you move into Your own house

If you have receipts of house rent allowance and if you are paying rent, exemption u/s 10(13A) will be available. Section 24, which allows a deduction in respect of interest on capital borrowed for purchase/construction of a house property, permits this deduction for the interest that relates to the previous year in which the property is ...

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Posted Under: Income Tax |

Tax Deduction for Contribution or Donation to Political Parties

Article explains What is the Political Party, What is the Electoral Trust, Who eligible to contribute or donate to the Electoral Trust or Political Parties, What is the Donation to Political Parties, What is Section 80GGC of Income Tax Act, 1961, What is the Eligibility Criteria for Claiming Tax Benefits under Section 80GGC, What is [&hel...

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Posted Under: Income Tax |

Interest on FDR of co-op society with co-op bank eligible for Section 80P(2)(d) deduction

Jaipur Zila Dugdh Utpadak Sahakari Sangh Ltd. Vs DCIT (ITAT Jaipur)

Interest income derived by assessee, co-operative society from its investments held with a co-operative bank, was entitled for claim of deduction under section 80P(2)(d) as for the purposes of section 80P(2)(d) of the Act, Cooperative Bank Ltd shall be treated as a co-operative society....

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HRA Exemption on maintenance Charges Paid Separately?

I am paying a house rent for Rs 14,000/- per month and additional Rs. 1,200/- towards maintenance for which receipt is being given to me every month. Will I get House Rent Allowance (HRA) exemption on Rs. 14,000/- or Rs 15,200/-. Please clarify....

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Posted Under: Income Tax | ,

House Rent Allowance (HRA)

If you are a Salaried Employee then you must know about the HRA. The Term HRA stands for House Rent Allowance. Generally every employee receives a HRA from their employers as part of his salary package, in accordance with terms and conditions of employment....

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House Rent Allowance – Income Tax provisions

In this article I have discussed provisions regarding exemption from House Rent Allowance -As per Section 10 (13A) and rule 2A exemption in respect of house rent allowance is based upon the following –1) An amount equal to 50 per cent of the salary, where the residential house is situated at Bombay, Kolkata, Delhi or Chennai, and an am...

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Posted Under: Income Tax | ,

HRA Taxability & Section 80GG Deduction on Rent Paid

House Rent Allowance (HRA) is a common component of the salary structure. Although HRA is a part of the salary, unlike basic salary, is not entirely taxable. Subject to certain conditions, a part of HRA gets exempted under Section 10 (13A) of the Income-tax Act. The tax benefit on HRA is available only to a salaried individual who has the...

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Public Provident Fund (PPF) – Tax benefit and Returns

Eligibility - Individuals who are residents of India are eligible to open an account under the Public Provident Fund scheme. A PPF account may be opened under the name of a minor by his/her legal guardian. However, each person is eligible for only one account under his/her name....

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Posted Under: Income Tax |

Tax Benefit on Home Loan

Repayment of housing loan is through Equated Monthly Installments (EMI) which consists of principal and interest component. As the repayment comprises of 2 different components, the tax benefit on home loan is governed by different sections of the Income Tax Act and these are claimed as tax deductions under different sections while filing...

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Section 80IBA Time limit for approval of project extended to 31.03.2021

Extending time limit for approval of affordable housing project for availing deduction under section 80-IBA of the Act extended to 31st March, 2021. The existing provisions of section 80-IBA of the Act, inter alia, provide that where the gross total income of an assessee includes any profits and gains derived from the business of developi...

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Posted Under: Income Tax |

Section 80EEA Time limit for sanctioning of loan extended till 31.03.2021

Budget 2020: Extending time limit for sanctioning of loan for affordable housing for availing deduction under section 80EEA of the Act to 31st March, 2021. The existing provisions of section 80EEA of the Act provide for a deduction in respect of interest on loan taken from any financial institution for acquisition of an affordable residen...

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Posted Under: Income Tax |

Deductions In Respect of Certain Incomes (Section 80IA To 80IE)

Simple And Latest Version of Deductions In Respect of Certain Incomes (80IA To 80IE) The Deductions in respect of section 80IA to 80 IE is quite confusing. Therefore those sections create so many problems to Commerce Professionals, teachers and students. Hence, I tried to simplify these section through this article for the benefit of not ...

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Posted Under: Income Tax |

House Rent Allowance – Taxability & Exemption

In my today’s article I will discuss about the House Rent allowance (HRA). Now the catch here is that you an employee might trust your employer for allowing you the HRA, but at the same time you should know the right way of treatment of HRA in your Income Statement while you are filing your Income Tax Return....

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Posted Under: Income Tax | ,

Taxability of Leave Travel Allowance (LTA) | Section 10(5)

Leave Travel Allowance (LTA) is the most common element of compensation adopted by employers to remunerate employees due to the tax benefits attached to it. Section 10(5) of the Income-Tax Act, 1961, read with Rule 2B, provides for the exemption and outlines the conditions subject to which LTA is exempt. Through this write-up, I want t...

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Posted Under: Income Tax |

HRA: How to compute exemption

What is House Rent Allowance? Employees generally receive a house rent allowance (HRA) from their employers. This is a part of the salary package, in accordance with the terms and conditions of employment. HRA is given to meet the cost of a rented house taken by the employee for his stay....

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Posted Under: Income Tax |

Pre Budget Recommendations of Income Tax for Union Budget, 2020

As we all are aware that The Union Budget for 2020-21 will be presented in the Lok Sabha on 1st February, 2020) at 11.00 am by our Finance Minister Nirmala Sitharman. As per every year, this year also Institute of Chartered Accountants of India has submitted its Pre Budget Memorandum to the government. Today we […]...

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Tax Incentive for Additional Employee Cost – Section 80JJAA -Analysis

Article explains Background of Section 80JJAA, Conditions to be fulfilled for claiming deduction under Section 80JJAA, Amount of Deduction under Section 80JJAA and Illustration on deduction under Section 80JJAA. Before I delve into my topic of discussion, lets have a little background of Section 80JJAA of the Income Tax Act 1961. Backgrou...

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Posted Under: Income Tax |

Avenues to Save Tax in F.Y. 2019-20

Author discusses 7 Avenues to Save Tax in F.Y. 2019-20 which includes Deduction under Section 80C on Specified Investments or Expenses, Deduction for Contribution to the National Pension System, Deduction for payment of Health Insurance/Mediclaim Premiums, Deduction on Home rent paid by you, Deduction on the interest on your home loan, De...

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Posted Under: Income Tax |

100% Deduction in Respect of Profits from Housing Projects

Who can claim deduction under this section? Any assessee (may be an individual, HUF, firm, company or any other person) can claim deduction under this section....

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Posted Under: Income Tax |

80JJAA: Deduction in respect of employment of new employees

As the IT Return due date is near for A.Y 2017-18 now everyone is looking for tax saving by various section. Here is the option to claim additional expense that to without any additional investment of 30% for new employee’s u/s 80JJA of IT Act. This purpose behind this section is to employment generation across all sectors....

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Posted Under: Income Tax |

Interest earned by Co-op Society on Investment with Co-op Bank eligible for Deduction

Technopolis Premises Co-operative Society Limited Vs PCIT (ITAT Mumbai)

Technopolis Premises Co-operative Society Limited Vs PCIT (ITAT Mumbai) We are of the considered view that though the co-operative bank pursuant to the insertion of sub-section (4) of Sec. 80P would no more be entitled for claim of deduction under Sec. 80P of the Act, however, as a co-operative bank continues to be a co-operative [&hellip...

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Section 80C Deduction for tuition / school / education fees

Deduction for tuition fees u/s. 80c of the Income Tax Act 1961 is available to Individual Assessee and is not available to HUF. Maximum Child: Deduction under this section is available for tuition fees paid on two children’s education. If Assessee have more then two children then he can claim tuition fees paid of only two children’s. ...

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Contributions to National Pension System (NPS) u/s 80CCD(1B)

As the Financial Year 2017-18 is nearing completion, individual tax payers are having hardly one month time to save tax. For individual assessees whose Rs.1.5 lakh savings limit as available u/s 80C, 80CCC and 80CCD(1) are exhausted the only option left is contribution to NPS....

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Posted Under: Income Tax |

Save more with Health Insurance

Health insurance is viewed as a significant investment and therefore tax deductions are offered u/s 80D of the Income Tax Act, 1961. Under this section, deductions are provided on the policies for self, spouse, dependent children and parents. Section 80D of the Income Tax Act, 1961 allows for deduction of money towards health insurance an...

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Posted Under: Income Tax |

How to extend PPF account beyond 15 years

We have to initially open the Open the PPF account for 15 years and after the initial period of 15 years is over, one can keep on extending the deposit for a period of 5 years at a time. In fact, this is where the magic of PPF begins. One need not start a fresh PPF account and continue it for all of 15 years — just extend the old one fo...

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Posted Under: Income Tax | ,

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