TAX FREE MEDICAL PERKS
Salaried employees enjoy special tax shelter for various reimbursements of medical expenditure for self & family!
Section 17(2) of the Income-tax Act provides for taxability of perquisites in the hands of a salaried employee. In this context, a salaried employee must plan to take the benefit of a number of medical facilities provided by an employer to the employee, which are not treated as taxable perquisites as per the Proviso to Section 17(2), which carves out exceptions to the general rule of taxing perquisites. (more…)
WELCOME RELIEF FOR HOUSING DEVELOPERS!
Gujarat HC confirms ITAT’s liberal interpretation on tax holiday for residential projects u/s. 80IB(10)
Housing developers having undertaken the business of developing and building residential housing projects, with a view to avail 100% deduction in respect of their profits as prescribed under Section 80IB(10) of the Income-tax Act, can truly heave a sigh of relief, with the Gujarat High Court finally resolving some burning controversies raised by the Revenue over the past few years.
Around 50 Tax Appeals filed by the Department have come to be recently disposed of under a consolidated order passed in the case of ‘Radhe Developers, Shakti Corporation & Others’ by the Bench comprising of Hon’ble Mr. Justice Akil Kureshi and Ms. Justice Sonia Gokani, who were called upon to decide two key contentions relating to eligibility for claim of deduction under Sec. 80IB(10). (more…)
TAX CONCESSIONS FOR DONATIONS!
Contributions & Donations to approved Charities & Research Institutions qualify for deductions from 50% to 175% !
Section 80G of the Income-tax Act provides for deduction out of gross total income in respect of donations to approved Funds and Charitable Institutions. The benefit of this deduction and consequential tax saving is available to any taxpayer viz. individual, HUF, company, firm, etc., whether resident or non-resident. (more…)
PLANNING RECIPES FOR TAX SAVING
Head of the household must do some smart thinking for maximizing the family’s tax benefits u/s.80C!
A significant relaxation announced at the time of the passing of the Finance Bill, 2005, related to the abolition of the proposed condition for deduction of upto Rs.1,00,000 under Section 80C requiring that “the eligible investments must be made out of a taxpayer’s income chargeable to tax.” With this restriction removed, it became possible for taxpayers to invest in various tax saving schemes or incur eligible expenditure, even by securing loans or gifts or withdrawing out of their exempt incomes or accumulations. This point can be better appreciated by the illustration hereunder:
Illustration: Mr. Smart’s gross taxable income is Rs.9,00,000, on which the income-tax payable for FY 2011-12 would work out to Rs.1,25,660. He is under strain to invest Rs.1,00,000 and avail deduction under Section 80C, since he needs the entire income of Rs.7,74,340 (after tax provision of Rs.1,25,660) for meeting his family obligations.
Mr. Smart is in a position to withdraw Rs.70,000 from his PPF A/c and avail Rs.30,000 as a short term loan from his friend. He should plan to raise this resource of Rs.1,00,000 and out of the same invest Rs.70,000 back in his PPF A/c and also invest Rs.30,000 in any other eligible investment under Section 80C. He would thus be entitled to avail the benefit of deduction of Rs.1,00,000 under Section 80C, which would mean that his taxable income would now work out to Rs.8,00,000, the income-tax payable thereon amounting to Rs.94,760. Out of the tax saved Rs.30,900 (1,25,660 – 94,760), he can smartly repay his friend’s loan of Rs.30,000 and draw satisfaction of having made the new 80C investment of Rs.30,000. (more…)
TAX HOLIDAY FOR LEAVE TRAVEL CONCESSION
Get LTC from your Employer and Enjoy Family Vacation with Tax Exemption
One of the important tax free perquisites available to salaried employees is ‘Leave Travel Concession’ (LTC) or ‘Leave Travel Assistance’ (LTA) which is treated as exempt under Section 10(5) of the Income-tax Act read with Rule 2B of the Income-tax Rules.
TAX INCENTIVES FOR HIGHER EDUCATION
Eight Years Deduction for Interest on Loan for Higher Education, without any Monetary Ceiling
Section 80E provides for deduction in respect of any amount paid by an individual (without any monetary ceiling) by way of interest on loan taken from any bank or notified financial institution or an approved charitable institution for the purpose of pursuing his higher education or the higher education of his relatives viz. his spouse or his child or even in respect of a student for whom the individual is the legal guardian.
This deduction is allowed for a maximum period of eight years starting from the year in which the taxpayer starts paying interest or until the interest payable on such loan stands paid in full, whichever is earlier.
TAX SAVING MAGIC OF SECTION 80C!
Do Not Miss to Buy, Beg or even Borrow…
Be Smart to Invest & Avoid your Tax Sorrow!
‘Be happy and gay … saving tax the 80C way!’ This should be the ‘Magic Mantra’ of all taxpayers with taxable income above Rs.8,00,000, who attract the maximum tax bracket of 30.9%. If you think smart, you can save a good Rs.45,743 as income-tax, without even investing a penny from your pocket! (more…)
TAX SUPPORT FOR DISABLED & AILING!
Income-tax Act provides for Liberal Deductions in the
Computation of Taxable Income in such Special Cases
The Income-tax Act provides for special deductions in computing the taxable income of a taxpayer who is disabled or who is required to incur expenditure for the medical treatment, training or rehabilitation of a disabled dependent or any amount deposited for the maintenance of such disabled dependent.
Similarly deduction is also allowed to a taxpayer who is required to incur any expenditure for the medical treatment of specified diseases or ailments, either for himself or a dependent relative. (more…)
TAX BREAK FOR YOUR CHILDREN’S EDUCATION
If you are spending a lakh on children’s tuition fees
You can reap a cool tax saving of upto Rs.30,900!
Today’s Q & A presentation discusses some interesting issues in relation to the tax incentive offered for your children’s education by Section 80C of the I.T. Act. (more…)
STAR INVESTMENT FOR SENIORS
Senior Citizens Savings Scheme Scores High On Tests Of Security, Return, Tax Saving & Liquidity
A secured investment, offering a reasonable return of 9% per annum (payable on quarterly basis), assuring premature encashment in case of need and enjoying the added benefit of deduction under Section 80C, have made the Senior Citizens Savings Scheme (SCSS) a popular choice of the elderly for catering to their regular income needs.
