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» » Tax Saving/Planning for Financial Year 2013-14 / Assessment Year 2014-15

1. Interest & Principal repayment on Home Loan – The principal component of your loan, is included under Section 80C, offering a deduction up to Rs. 1,00,000. The interest portion offers a deduction up to Rs. 1,50,000 separately under Section 24

2.Provide Rent Receipt for HRA -  A deduction is permissible under Section 10(13A) of the Income Tax Act, in accordance with Rule 2A of the Income Tax Rules for HRA. You can claim exemption on your HRA under the Income Tax Act if you stay in a rented house and get a HRA from your employer. You need to submit proof of rent paid through rent receipts, duly signed and stamped, along with other details such as the rented residence address, PAN of Landlord, name of the owner, period of rent etc.

If HRA forms part of your salary, then the minimum of the following three is available as exemption.
  • The actual HRA received from your employer
  • The actual rent paid by you for the house, minus 10% of your salary (this includes basic + dearness allowance, if any)
  • 50% of your basic salary (for a metro) or 40% of your basic salary (for non-metro).

3. Conveyance Allowance for commuting between office & Home is exempt up to Rs 800 per month. 

4. Children’s Education Allowance is exempt up to Rs 100 per month per child up to a maximum of two children

5. Deduction Under Section 80C – Section 80C allows a maximum limit of Rs 1 lakh across investments ranging from provident fund, PPF, infrastructure bonds, fixed deposits (5 years or more), NSC, insurance/pension plans, unit linked insurance, equity linked savings scheme etc. It also includes tuition fees of your children and the repayment of principal on your housing loan. To know about Investment which qualify for deduction Under Section 80C

6. Section 80D – Medical insurance plan or a health insurance plan of general insurance company works on the principle of reimbursement of your hospitalization expenses. If you invested in any of such policy then you can claim income tax deduction under section 80D of income tax act, 1961. Medical premia upto a maximum of Rs 15,000 qualifies for deduction, with an additional Rs 15,000 for parents. Additional deduction of 20,000 could be availed in case of a senior citizen.You can claim a separate deduction for medical premium of your parents. 

7. Interest on loan taken for higher education & vocational courses. :- Taxpayers also tend to forget that the interest paid on an education loan taken for higher studies or vocational curses qualifies for deduction under Section 80E of the I-T Act. Deduction is also available where the loan is taken for the purpose of higher education of spouse or children of the individual or the student for whom the individual is a legal guardian. Also remember that the deduction benefit on interest is allowed for maximum eight years, or till the interest is fully paid

8. Medical treatment of specified ailments under section 80DDB:-Deductions of expenses on medical treatment of specified ailments (such as AIDS, cancer and neurological diseases) can be claimed under Section 80DDB. The maximum amount of deduction allowed from gross total income is restricted to Rs 40,000 (which goes up to Rs 60,000 if the age of the person treated is 60 years or more) on condition that no medical reimbursement is received from any insurance company or employer for this amoun

9. Deduction U/s. 80DD -  A person  who have spent money on the maintenance (including medical treatment) of dependant persons with disability, could avail deductions  80DD of the Act.

10. Charitable deductions under section 80G: Deduction is also available under Section 80G of the I-T Act in respect of donations made by an individual to certain funds, charitable institutions and so on. There is no restriction on the amount of charity.  The rate of deduction, however, is either 50 or 100 per cent. However, you cannot use this route to evade tax by bringing down your income tax slab. There is a ceiling on the deduction a taxpayer can claim in a year. The quantum of deduction is limited to 10% of the gross total income of the donor. Also, only cash donations are taken into account. Donations of food, clothes and medicines do not qualify for such a deduction

11. Deduction under section 80U for Person with disability:-Under Section 80U of the Act, an individual who is certified by the prescribed medical authority to be a person with disability shall be allowed a deduction of Rs 50,000 and an individual, who is certified as a person with severe disability, shall be allowed a deduction of Rs 1,00,00

12. Rebate Under Section 87A – Section 87A seeks to provide that an assessee, being an individual resident in India, whose total income does not exceed five hundred thousand rupees, shall be entitled to a deduction, from the amount of income-tax (as computed before allowing the deductions under Chapter VIII of the Income-tax Act) on his total income with which he is chargeable for any assessment year, of an amount equal to hundred per cent of such income-tax or an amount of two thousand rupees, whichever is less

13. Medical Expenses Reimbursement – These are Exempt Up to Rs. 15000 per annum subject to few conditions

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