From the monthly archives:

August 2009

Medical Insurance (Health Insurance) - Section 80D

Posted by Gopal Gidwani in Insurance ->Uncategorized on August 22nd, 2009

• Under Section 80D a person paying premium for medical insurance for self, spouse and children is eligible for a deduction of upto INR 15000. • In case the person is above 65 years (senior citizen) then deduction of upto INR 20,000 can be availed. • For premium paid for health insurance for parents, an [...]

House Rent Allowance

Posted by Gopal Gidwani in Taxation ->Uncategorized on August 22nd, 2009

• An individual staying in a rented accommodation and paying rent can claim HRA exemption, if HRA component is a part of the salary. • HRA is exempt from income tax upto a certain limit. • The amount that can be availed as exemption from taxable income is the lower of the following 3 items: [...]

Leave Travel Allowance

Posted by Gopal Gidwani in Taxation ->Uncategorized on August 22nd, 2009

• Leave Travel Allowance is a special allowance which employed people get as a part of their salary. This allowance is given for taking vacations and for availing this facility the employee can claim exemption from his taxable salary. • This allowance can be claimed for vacation related travel expenses within the country. • This [...]

Section 80C Tax Deduction for Tuition Fees Paid for Children

Posted by Gopal Gidwani in Taxation ->Uncategorized on August 22nd, 2009

• Tuition fees paid for full time education of 2 children qualifies as deduction under Section 80C • This deduction is allowed only for full time education i.e. part time courses or distance learning courses do not qualify for this deduction. • This deduction can be availed for only 2 children. But husband and [...]

Home Loan Principal Repayment - Section 80C

Posted by Gopal Gidwani in Taxation ->Uncategorized on August 22nd, 2009

• An individual can claim income tax benefits on the principal repayment as well as the interest repayment on a home loan. • The principal repayment of upto INR 1,00,000 qualifies for deduction from taxable income under Section 80C. The interest repayment of upto INR 1,50,000 qualifies for deduction from taxable income under Section 24(b) [...]

Home Loan Interest Repayment - Section 24

Posted by Gopal Gidwani in Taxation ->Uncategorized on August 22nd, 2009

• An individual can claim tax benefits on the principal repayment as well as the interest repayment on a home loan. • The principal repayment of upto INR 1,00,000 qualifies for deduction from taxable income under Section 80C. The interest repayment of upto INR 1,50,000 qualifies for deduction from taxable income under Section 24(b) for [...]

Section 80E – Interest paid on a Education Loan

Posted by Gopal Gidwani in Taxation ->Uncategorized on August 20th, 2009

• Under Section 80E of the Income Tax Act, the interest paid on an education loan is eligible for deduction from taxable income • There is no upper limit to the amount that can be availed as deduction from taxable income for interest paid on the education loan. In short the entire interest amount is [...]

Senior Citizen’s Saving Scheme - SCSS

Posted by Gopal Gidwani in Others ->Uncategorized on August 20th, 2009

• Senior Citizen’s Saving Scheme (SCSS) product was introduced for senior citizens in the annual budget by the then Finance Minister in the year 2004. It is a part of Section 80C of the Income Tax Act. • All senior citizens can invest in this scheme. • Investments of upto INR 1,00,000 made in this scheme are [...]

Kisan Vikas Patra - KVP

Posted by Gopal Gidwani in Others ->Uncategorized on August 20th, 2009

• The minimum investment is INR 500. • The interest rate payable is 8.40% annually. The investment doubles in 8 years and 7 months. The interest earned is fully taxable. • This account can be opened by individuals. NRIs, corporates, trusts and other institutions cannot invest in KVP. • On maturity of the term, if [...]

Post Office Monthly Income Scheme - POMIS

Posted by Gopal Gidwani in Others ->Uncategorized on August 20th, 2009

• Minimum investment is of INR 1000 or in multiples of INR 1000. • The tenure of the investment is 6 years. • The interest rate payable is 8% per annum. The interest is payable monthly. This monthly interest can be directly credit to the savings account, if that is also maintained with the post [...]

Tax Saver Bank Fixed Deposit

Posted by Gopal Gidwani in Others ->Uncategorized on August 20th, 2009

• Investments of upto INR 1,00,000 made in the 5 year tax saver bank FD are eligible for deduction from taxable income.• Any individual or Hindu Undivided Family (HUF) can invest in the Bank FD under this scheme.• Account can be opened in single or joint names. In case of a joint FD the tax [...]

Life Insurance

Posted by Gopal Gidwani in Insurance ->Uncategorized on August 20th, 2009

Investments made in life insurance in the form of paying premiums qualify for deduction under Section 80C of the Income Tax Act. • The premiums paid qualify for tax benefits if the premium paid is equal to or less than 20% of the sum assured (SA). For example if the premium paid is INR 20,000 [...]