Income Tax - Rules and Regulations
This post has some common rules and regulations of personal income tax in India. This would help you to further understand the intricacies of taxes.
Income Tax Slabs/Rates for Financial Year 2011 – 12
1. Women assesses
2. Senior Citizen (60 – 79 Years)
3. Very Senior Citizen (80 Years and above)
4. All other assesses
Least of
Transport allowance is exempt up to Rs.800/- per month provided the person is in India during the month. For people having permanent physical disability, the exemption is Rs.1,600/- per month
Vehicle maintenance exemption can be claimed if you use a car for travel to the workplace. In such case, exemption can be claimed for the petrol and vehicle maintenance amounts. The exemption is available to the tune of Rs.1,200/- per month if the engine capacity is less than 1600cc and Rs.1,600/- per month if the engine capacity is more than 1600cc. In case the amount includes driver’s salary, there is an additional exemption of Rs.600/- per month. When this exemption is claimed, transport allowance exemption is not available.
Medical bills are exempt for self and dependent family, up to Rs.15,000/- per annum
LTA is exempt to the tune of ecomony class Train/ Air /Recognized public Transport fare for the family to any destination in India, by the shortest route.
LTA can be claimed twice in a block of 4 calendar years. The current block is from 01.01.2010 to 31.12.2013. For claim, it is must to provide originals tickets etc.
u/s 24 There is an Exemption for interest on housing loan.(for Self occupied Residence). If the loan was taken before Apr 1, 1999 exemption is limited to Rs.30,000/- per year. If the loan was taken after Apr 1, 1999 exemption is limited to Rs.1,50,000/- per year if the house is self-occupied; There is no limit if the house is rented out.
This exemption is available on accrual basis, which means if interest has accrued, you can claim exemption, irrespective of whether you’ve paid it or not.
If you have rented out your house, enter the total income/loss from the house (after deducting property tax and standard maintenance expenses).
u/s 80D Medical Insurance (such as Mediclaim & Critical illness Cover) premium is exempt upto Rs.15,000/- (for 2011-12) per year. If the premium includes that for a dependent who is above 65 years of age, an extra Rs.5000/- can be claimed ( for 2011-12 ) per year.
u/s 80DD Deduction in respect of medical treatment of handicapped dependents is limited to Rs.50,000/- per year if the disability is less than 80% and Rs.75,000/- per year if the disability is more than 80%
80DDB Deduction in respect of medical treatment for specified ailments or diseases for the assesse or dependent can be claimed upto Rs.40,000/- per year. If the person being treated is a senior citizen, the exemption can go up to Rs.60,000/-
u/s 80E Interest repayment on education loan (taken for higher education from a university of self & dependents) is completely tax exempt.
u/s 80G Donations given for certain charities are tax exempt. Some are exempt to the tune of 50%, whereas others are 100%.
u/s 80GG If you do not get HRA, but have rented a house, an exemption is available. This will be calculated as minimum of (25% of total income or rent paid – 10% of total income or Rs.24,000/- per year)
u/s 80U If you have a permanent physical disability (including blindness), you can take an exemption (subject to maximum of Rs.75,000/- per year)
u/s 80C Investments up to 1 lac in PF, VPF, PPF, Insurance Premium, Housing loan principal repayment, NSC, ELSS, etc. are deductible from the total income (there is no limit on individual items, for example 1 lac can be invested in Insurance)
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I just wanted to know that i get a petrol Reimbursement/ Conveyance allowance from my employer which is Rs 2000/- per month and i do have bills with me for Petrol bills.
so can i claim full amount ie. Rs 2000 per month or will only will be Rs 800/- per month...
We are staying in Chennai and planning to buy an apartment for investment. If we buy an apartment in Chennai will be able to claim HRA till the house is constructed fully and ready for occupation. Obviously in the construction stages we will be paying the pre-EMI on which we will claim tax benefit.
Or is it recommended to buy an apartment in some other city so that we can claim both HRA and tax benefit on house loan?
You are eligible to claim tax benefit on HRA until the house is ready to move. But once the house is ready and you start claiming tax benefit on housing loan, some companies don't agree to both tax benefits. In that case you would need to provide a proof that you are still staying on rent and you cannot shift to your new house. The reason for this could be far from workplace or any thing genuine.
Still if company denies benefit you would need to claim it directly from Income Tax department while filing tax return.
In summary, it would be better if you invest in some other city than Chennai if you want no hassels in claiming HRA & Home Loan Tax benefit, but if you feel Chennai is the place to invest go ahead.
Is there a provision to claim the amount spent on house renovation (repairs, painting etc.,)?
Yes you can claim up to Rs 30,000 exemption on interest paid on Home Renovation Loan payment
Very nice, i suggest Admin can set up a forum, so that we can talk and communicate.
Nancy
I tried setting up a forum but its difficult to handle in the limited time I have. May be some future day!
Most companies ask for rent receipts for giving tax benefit on HRA. You can tell your owner to make a rent receipt there and scan it and email it to you. You are required to anyway submit photocopies of rent receipts. So you can take print out of the same and submit it.