Section 80C Deductions
Section 80C of the Income Tax Act allows certain investments and expenditure to be tax-exempt. The total limit under this section is Rs. 100,000 (Rupees One lakh) which can be any combination of the below:
* Contribution to Provident Fund or Public Provident Fund
* Payment of life insurance premium
* Investment in pension Plans
* Investment in Equity Linked Savings schemes (ELSS) of mutual funds
* Investment in specified government infrastructure bonds
* Investment in National Savings Certificates (interest of past NSCs is reinvested every year and can be added to the Section 80 limit)
* Payments towards principal repayment of housing loans.Also any registration fee or stamp duty paid.
* Payments towards tuition fees for children to any school or college or university or similar institution. (Only for 2 children)
The investment can be from any source and not necessarily from income chargeable to tax.
Section 80D: Medical Insurance Premiums
Medical insurance, popularly known as Mediclaim Policies, provide deduction up to Rs 30,000 . This deduction is additional to Rs.1,00,000 savings. For senior citizens, the deduction up to Rs. 20,000 is allowable. This deduction is available for premium paid on medical insurance for oneself, spouse, parents and children.It is also applicabe to the cheques paid by proprietor firms.
Interest on Housing Loans
For self occupied properties, interest paid on a housing loan up to Rs 150,000 per year is exempt from tax. However, this is only applicable for a residence constructed within three financial years after the loan is taken and also the loan if taken after April 1, 1999.
If the house is not occupied due to employment, the house will be considered self occupied.
For let out properties, the entire interest paid is deductible under section 24 of the Income Tax act. However, the rent is to be shown as income from such properties. 30% of rent received and municipal taxes paid are available for deduction.
The losses from all properties shall be allowed to be adjusted against salary income at the source itself. Therefore, refund claims of T.D.S. deducted in excess, on this count, will no more be necessary.
Section 80C of the Income Tax Act allows certain investments and expenditure to be tax-exempt. The total limit under this section is Rs. 100,000 (Rupees One lakh) which can be any combination of the below:
* Contribution to Provident Fund or Public Provident Fund
* Payment of life insurance premium
* Investment in pension Plans
* Investment in Equity Linked Savings schemes (ELSS) of mutual funds
* Investment in specified government infrastructure bonds
* Investment in National Savings Certificates (interest of past NSCs is reinvested every year and can be added to the Section 80 limit)
* Payments towards principal repayment of housing loans.Also any registration fee or stamp duty paid.
* Payments towards tuition fees for children to any school or college or university or similar institution. (Only for 2 children)
The investment can be from any source and not necessarily from income chargeable to tax.
Section 80D: Medical Insurance Premiums
Medical insurance, popularly known as Mediclaim Policies, provide deduction up to Rs 30,000 . This deduction is additional to Rs.1,00,000 savings. For senior citizens, the deduction up to Rs. 20,000 is allowable. This deduction is available for premium paid on medical insurance for oneself, spouse, parents and children.It is also applicabe to the cheques paid by proprietor firms.
Interest on Housing Loans
For self occupied properties, interest paid on a housing loan up to Rs 150,000 per year is exempt from tax. However, this is only applicable for a residence constructed within three financial years after the loan is taken and also the loan if taken after April 1, 1999.
If the house is not occupied due to employment, the house will be considered self occupied.
For let out properties, the entire interest paid is deductible under section 24 of the Income Tax act. However, the rent is to be shown as income from such properties. 30% of rent received and municipal taxes paid are available for deduction.
The losses from all properties shall be allowed to be adjusted against salary income at the source itself. Therefore, refund claims of T.D.S. deducted in excess, on this count, will no more be necessary.
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