1 / 36

WELCOME

WELCOME. Salary Taxation. Department Website. The relevant Acts, Rules, Forms and Notifications are available at the website of the Income-tax Department - www.incometaxindia.gov.in. TDS rates for Financial Year 2013-14. SECTION 87A.

wyatt-leon
Download Presentation

WELCOME

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. WELCOME

  2. Salary Taxation

  3. Department Website The relevant Acts, Rules, Forms and Notifications are available at the website of the Income-tax Department -www.incometaxindia.gov.in

  4. TDS rates for Financial Year 2013-14

  5. SECTION 87A • Individual whose net income does not exceed Rs. 5,00,000/-is entitled for rebate u/s 87A for Rs. 2,000/-. • This is in addition to benefits of slab rates given by Govt. • AY 2014-15

  6. Topics WHAT IS SALARY ALLOWANCES INCOMES WHICH DO NOT FORM PART OF TOTAL INCOME. DEDUCTION UNDER SECTION 16 DEDUCTIONS UNDER CHAPTER VI A

  7. What is salary ?(Sec.15,16&17) • Employer and Employee relationship • An income can be taxed under the head salaries only if there is a relationship of an employer and employee between the payer and payee.

  8. What is salary ? Salary includes Wages, Bonus Annuity Pension, Gratuity, Fees, Commission, Perquisites, Leave encashment, Arrears of salary others.

  9. Any salary, bonus, commission or remuneration, by whatever name called, due to, or received by, a partner of a firm from the firm shall not be regarded as “Salary”. What is salary ?

  10. Allowances which are Fully exempted in case of Certain Person • Indian Citizen – Govt. Servant Working Outside India • SC and HC Judge • UNO Employees • Chairman, Member or Retired Member of UPSC [10(45)]

  11. HOUSE RENT ALLOWANCE u/s.10(13A) The least of the following exempted Actual HRA received Rent paid in excess of 10% of salary 50% of salary in metro cities 40% in other places. For this purpose “Salary” includes dearness allowance if terms of employment so provide

  12. House Rent Allowance • The disbursing authorities should satisfy themselves in this regard by insisting on production of evidence of actual payment of rent. • It has been decided as an administrative measure that salaried employees drawing house rent allowance up to Rs. 3,000 per month will be exempted from production of rent receipt. [Cir. 9/2003, dt. 18/11/03]

  13. Allowances exempt, amount received or limit specified, which ever is less Children Education Allowance : Exempt up to actual amount received per child or Rs.100 p.m. per child up to maximum of two children, which ever is less. Transport Allowance : Exempt to the extent of Rs.800 p.m. Washing Allowance : Exempt to the extent of actual expenditure.

  14. S.10 – Incomes which do not form part of total income. These payments will not be part of salary subject to limits prescribed LTC (Sec. 10(5)) The exemption is allowed only in respect of fare only. Gratuity (Sec. 10(10)) Commuted value of pension (Sec. 10(10A)) Leave encashment at the time of retirement (Sec. 10(10AA)) Provident fund receipts and RPF receipts (Sec. 10(11) & 10(12))

  15. LTC • LTA tax exemption can be claimed twice in block of 4 years • 01-Jan-2006 – 31-Dec-2009 • 01-Jan-2010 – 31-Dec-2013 • 01-Jan-2014 – 31-Dec-2017 • Amt spent on self, spouse, children (maximum of two children), parent, brother, sister, and dependent. • Travel within India via rail, air, road through shortest route • lodging, boarding, food, cab fare, auto fare, driver tip/allowance.

  16. Gratuity Death Cum Retirement Gratuity received by the Central Govt./State Govt. /Local Authorities- EXEMPT Covered by gratuity Act, 1972 least of the following is exempted. Actual amount received. 15 days salary (based on last drawn salary) for each year of completed service - (i.e. 15 days Salary x Length of Service) Rs.10,00,000/-.

  17. EL Encashment Central Govt / State Govt Employees – Exempt Other Employees – Earned Leave received During the Tenure of Service -Fully Taxable Earned Leave received on Retirement or Superannuation Least of the Following will be Deducted Amount Actually Received Rs. 3,00,000/- Average Salary x 10 (Maximum 30 Days for each completed year of Service minus Leave Available ) x Average Salary

  18. Deduction under section 16 Tax on employment (professional tax) paid is allowable as deduction from salary. (max:- 2,500/- P.A) Entertainment Allowance : This deduction is allowed only to a Government employee to the least of following. Actual amount received. 20% of salary exclusive of any allowance. Rs.5000.

  19. Deduction on income fromHouse property interest up to a maximum limit of Rs. 1,50,000 is allowed Loan taken on or after 1-4-1999 for constructing/acquiring the residential. house and completed within three years from the end of the financial year in which capital was borrowed. No limits for the let out property Only one property is eligible for deduction

  20. Section 80EE Deduction for interest on loan on Residential House • Inserted wide FY 2013-14 • Deduction upto Rs.1,00,000 • Loan taken during FY 2013-14 • Loan Amount does not Exceed 25 Lacs • Value or Residential Property does not Exceed 40 Lacs

  21. Deductions under chapter VIA –u/s.80C,80CC &80CCD The following investments are eligible for deduction: Life Insurance Premium, Statutory Provident Fund, RPF, PPF, NSC, ULIP, Notified Units of Mutual Fund, Re-payment of housing loan, Tuition Fee paid, fixed deposit for 5 years or more with a scheduled Bank, Senior Citizen Saving Scheme, five year time deposit scheme in Post Office etc.

  22. Deductions u/s.80C,80CC&80CCD • Amount of deduction allowable; gross qualifying amount or Rs.1,00,000 which ever is lower.

  23. Deduction u/s.80D • Medical insurance premium (Med claim Policy) paid: On the health of taxpayer, spouse, parents and dependent children • The premium can be paid by any mode other than cash.

  24. Deduction u/s.80D • Amount of deduction Rs.15,000 – • additional deduction Rs.5,000 is allowed if the policy is taken on the health of senior citizen. • Preventive Medical Check up Rs. 5,000 from 2012-13

  25. Deduction u/s.80DD Deduction in respect of maintenance including medical treatment of a handicapped dependent : Furnish a certificate issued by the medical authority in form No.10-IA. Amount of deduction Rs.50,000 is allowed. In case severe disability - Rs.1,00,000 is allowed. The person claiming deduction under this section, he should not claim any deduction under section 80U.

  26. Deduction u/s.80DDB Medical treatment of dependent or self for specified disease/ailment. Amount of deduction Rs.40,000: if the person is a senior citizen Rs.60,000 is allowed. This deduction is not allowable by the employer.

  27. Deductions -u/s.80E Payment of interest on loan taken for higher education: spouse or children The loan has to be taken from any financial institution or approved charitable institution. The deduction is available for a maximum of 8 years

  28. Deductions -u/s.80G Deduction in respect of donations to certain funds, charitable institutions etc. Deduction can be allowed by the employer only in respect of donations made to Prime Minister Relief Fund, Chief Ministers Relief Fund, Earthquake Fund, National Childern Fund, etc. · In respect of donations to charitable institutions, deductions cannot be allowed by the employer.

  29. Deductions -u/s.80GG Deduction in respect of rent paid The assessee should not be receipt of HRA and he should not own any house The least of the following amount is exempted Rent paid in excess of 10% of total income before allowing deduction under this section. Rs.2000 per month. 25% of total income before allowing deduction under this section

  30. Rajeev Gandhi Equity Saving Scheme – 80CCG • Total Income does not Exceed 12 Lacs • Investment – 50,000 (Max.) • Deduction – 50% of Investment. • For 3 Consecutive Years. • Lock-in Period – 3 Years. • Over & above Deduction of 1,00,000/- under 80C

  31. Deduction-u/s.80GGC Any amount of contribution made by a person to a political party or an electoral trust is deductible. This deduction is not allowable by the employer.

  32. Deductions under Chapter VI A-u/s.80U Deduction in case of a person with disability: blindness, low vision, leprosy, hearing impairment, mental retardation and mental illness. Conditions: Furnish a certificate issued by the medical authority in form No.10-IA. Amount of deduction (fixed)Rs.50,000 is allowed. In case severe disability -Rs.1,00,000 is allowed.

  33. Relief u/s.89(1) Relief is available when salary is received in arrears or advance. Application in Form-10E has to be obtained from the employee. Form 10E is required to allow claim of relief u/s. 89(1)

  34. Tax on Provident Funds & various exemptions

  35. Points to Ponder If the House Property is transferred before expiry of five years no deduction in the year of transfer and earlier deductions allowed will become income in the year of transfer . No deductions u/s. 80C for the repayment of principal amount if the loan is taken from the private persons and also not for commercial properties. ?

  36. Thank you

More Related