itfiling.in

28/07/2014

Income-tax return is a legal document and it should be filed by the assessee with due care and caution. There should be no corrections or overwriting and it should be properly signed and verified by the person authorized to do so under the provisions of the Income-tax Act. The following important points may be taken care of while filling up the return forms:

1. ITR Applicable- Each assessee has to identify the correct ITR Form applicable in its case before filing the return of income.

2. No enclosures to the return- Rule 12(2) of the I.T Rules provides that the return of income and return of fringe benefits required to be furnished in Form No. ITR-1, ITR-2, ITR-3, ITR-4, ITR-4S ITR-5, ITR-6, or ITR-8 shall not be accompanied by a statement showing the computation of tax payable on the basis of return, or proof of tax, if any, claimed deducted or collected at source or the advance tax or tax on self assessment, if any, claimed to have been paid or any document or copy of any account or form or report of audit required to be attached with the return of income or return of fringe benefits under any provisions of the Act.

3. For timely delivery of refunds, ensure correct address and account number on your Return of Income – From 1.10.07 onwards, all income tax refunds in Bangalore, Chennai, Delhi, Kolkata and Mumbai will be delivered by the Refund Banker directly at the communication address mentioned on the Return of Income. Taxpayers are requested to fill in the correct address(available during working hours for delivery) to ensure speedy delivery of refunds. In the case of taxpayers who opt for refunds through ECS, it will be credited directly to the bank account for which correct MICR code/ Bank Account Number has to be furnished on the Return.

4. Manner of filing the new Forms

These Forms can be submitted in the following manner:

(i) furnishing the return in a paper form;

(ii) furnishing the return electronically under digital signature;

(iii) transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V;

(iv) furnishing a bar-coded return in a paper form:

Mandatory E-Filing of Income Tax Return
E-filing of Income Tax return with digital signature is mandatory for Individuals, HUF and firms requiring statutory audit u/s 44AB of the Income Tax Act, 1961.
E-filing of Income Tax return with digital signature is mandatory for all Companies irrespective of Income.
A person, other than a company and a person required to furnish the return in Form ITR-7 ] if his or its total income, or the total income in respect of which he is or it is assessable under the Act during the previous year, exceed [five lakh rupees], shall e-file their Income Tax return either with or without digital signature.
Individual and HUF having assets (including financial interest in any entity) located outside India; or are signing authority in any account located outside India have to e-file their Income Tax return either with or without digital signature.
If Assessee claims any relief of tax under section 90 or 90A or deduction of tax under section 91 of the Act than Assessee have to e-file their Income Tax return either with or without digital signature.
All the Assessee who are required to file ITR-5 and not covered by tax audit provisions have to e-file their Income Tax return either with or without digital signature.
In addition to above all the Assessees who are required to file furnish a report of audit specified under sub-clause (iv), (v), (vi) or (via) of clause (23C) of section 10, section 10A, section 10AA, clause (b) of sub-section (1) of section 12A, section 44AB, section 44DA, section 50B, section 80-IA, section 80-IB, section 80-IC, section 80-ID, section 80JJAA, section 80LA, section 92E, section 115JB or section 115VW or to give a notice under clause (a) of sub-section (2) of section 11 of the Act have to e-file their Income Tax return either with or without digital signature.

5. Filling out acknowledgement- Where the return is furnished in paper format, acknowledgement slip attached with the return should be duly filled in. The new forms are not required to be filed in duplicate.

6. Intimation of processing under section 143(1) – The acknowledgement of the return is deemed to be the intima-tion of processing under section 143(1). No separate intimation will be sent to the taxpayer unless there is a demand or refund.

7. Filing your return through Tax Return Preparers (TRPs)

If you are an individual or an HUF assessee and you are not required to get your accounts audited (called ‘eligible person’) under the provisions of the Income Tax Act, then you can use the services of a Tax Return Preparer (TRP). However, if the ‘eligible person’ is not a resident in India during the previous year relevant to such assessment year, he can not avail of the services of a TRP.

If you are filing your returns through a TRP then you should ensure that:

i) You are eligible to file return of Income under this Scheme;

ii) You give your consent to any Tax Return Preparer to prepare your return of income for any assessment year;

iii) You verify that the facts mentioned in the return are true and correct before you sign the return;

iv) You certify the amount which has been paid by you under this Scheme to the Tax Return Preparer for preparing and furnishing of the return of income; and

v) You take a receipt of the payment made to the Tax Return Preparer and produce the same before the Resource Centre or Assessing Officer, if required,

Incentive to Tax Return Preparers

The Tax Return Preparer shall charge a fee of two hundred and fifty rupees for any assessment year from the eligible person for preparing and furnishing his return of income for that assessment year:

Provided that he will charge no fees for preparing and furnishing the return for any eligible assessment year if the amount disbursable to him as per the scheme notified by the government for that eligible assessment year exceeds two hundred and fifty rupees. If the amount disbursable is less than two hundred and fifty rupees, we can charge the difference between rupees two hundred fifty and the amount disbursable.

8. Verification

The verification must be signed by the authorized person before furnishing the return and the name and designation of the person signing the return should also be written. Any person making false statement is liable to be prosecuted under section 277 of the Act.

WHO CAN VERIFY AND SIGN THE INCOME TAX RETURN?

a) Individual : The individual filing his Income Tax Return has to sign the return. In case the individual is mentally incapable, then the return may be signed by his Guardian or by any other person competent to act on his behalf.

In case the individual is absent from India or because of any other reason he is not able to sign and verify his return of income, then any person duly empowered by him through valid Power of Attorney may sign on his behalf. In such a case, a certified copy of the Power of Attorney must accompany the return.

b) Hindu Undivided Family : By the Karta or where he is absent from India or is mentally incapacitated from attending to his affairs, by any other adult member of such family.

c) Company : In this case by the following :-

1) Resident : Managing Director or, where there is no Managing Director or he is not able to sign and verify the return due to any unavoidable reason, by any director thereof.

2) Non-Resident : The return may be signed and verified by a person holding a valid Power of Attorney from the Company, which should be attached to the return.

3) Wound up/taken over by the Govt. : The return should be signed and verified by the Liquidator or the Principal Officer as the case may be.

d) Firm : Managing Partner, or where there is no Managing Partner or due to some unavoidable reasons, he is not able to sign and verify the return, by any partner thereof not being a minor.

e) Local Authority : By the Principal Officer.

f) Association of Persons : By any member of the Association or the Principal Officer thereof.

9. WHERE TO FILE THE INCOME TAX RETURNS?

An existing assessee must file his Income-Tax Return with the Assessing Officer who had previously assessed him or with the Assessing Officer where his case stands transferred. A new assessee should file the Return with the Assessing Officer having territorial jurisdiction over the area where he resides or his principal place of business is situated or with the Assessing Officer having special jurisdiction over specific assessees or classes of income. For example, where the major source of income of an assessee is the income from contract business, the IT Return should be filed with the assessing officer having jurisdiction over the contractor circles. A doctor or C.A. or an Advocate should file the returns in professional circles if any specified.

The return may be delivered at the counter in the concerned Range/Circle or it may be sent by registered post. The return is attached with two acknowledgement forms which should be duly filled in by the assessee. One copy of the acknowledgement form is to be returned by the official at the counter duly signed, stamped, numbered and dated in support of having received the return. In case of any doubt or problem, the taxpayer should contact the Public Relations Officer for guidance and help.

24/07/2014

How costly can the delay in filing tax returns be?

Due date for Filing Income Tax Return for Assessment Year 2014-15 for Salaried Persons and other Assessees who are engaged in business and profession and whose turnover is less than Rs. 100 lakh (in the case of business) and Rs 25 lakh (in the case of profession) is 31st July 2014. In this article we have detailed in the form of Question answers Consequences of Delay in Filing Return of Income or of Filing Return after the due date.

Question:-First, what are the due dates?

Answer:- Assessees having income from salary have to file return of income before July 31 of the assessment year. This is the `due date’ prescribed in section 139(1) of the Income Tax Act, 1961.

Self-employed businessmen and professionals, and those deriving income from let-out property too have to file their returns by this date.

However, businessmen and professionals with aggregate turnover/annual receipt exceeding Rs 100 lakh (in the case of business) and Rs 25 lakh (in the case of profession) have time up to September 30 for filing their return of income.

Question:-Are there any benefits in filing by the due date?

Anwer:- An assessee filing return by the `due date’ provided in the statute is eligible to file a revised return if he discovers any omission or wrong statement therein. Time limit for filing revised return is one year from the end of the assessment year or before completion of assessment. No penalty would be levied for filing a revised return on voluntary basis.

Question:-So, by filing late, does one lose the revision option?

Answer:- Yes. If an assessee does not file his return within the `due date’ and files his return subsequently, he cannot have the benefit of revising the return, as the return filed beyond the `due date’ is treated as `belated return’.

Question:-Any other advantages of sticking to the deadline?

Answer:-The taxpayer gets the advantage of carry forward and set off of losses, such as loss from business and loss under the head `capital gains’. If the return is filed beyond the `due date’ mentioned in section 139(1), these losses cannot be carried and set off against the income of subsequent years.

Yet another advantage of filing return before `due date’ is the eligibility for interest on tax refund from April 1 of the assessment year.

Question:-Can delay, therefore, be wasteful for `refund’ cases?

Answer:-Yes, because where the return is filed after the `due date’, interest on refund is paid only for the period from the month of filing the return to the date of refund. In other words, no interest is paid for the period from April 1 of the assessment year to the date of filing the `belated return’.

Question:-Do those with `nil’ tax liability have anything to fear?

Answer:-Where the return is filed beyond the `due date’, the taxpayer has to pay interest if any, on tax liability existing beyond tax deducted at source (TDS) or tax collected at source (TCS) or the advance tax paid. The question of interest does not arise where tax due for payment is `nil’, as would be in the case of most salaried people who pay their taxes through the TDS route. Legally, a taxpayer can file his return before the end of the assessment year without any penalty (however with penal interest under section 234A). Again, the question of penal interest does not arise in the `nil’ cases discussed above. For the assessment year 2014-15, return of income could be filed up to March 31, 2015.

Question:-How costly can delay in filing IT return be?

Answer:-Apart from interest and penal interest, there are other implications. If the return is filed after March 31, 2015 but before March 31, 2016 the AO (Assessing Officer) could levy a penalty of Rs 5,000 under section 271F. Even when there is no further tax payable on the income admitted, penalty under section 271F is leviable for the delay. If the return is filed after March 31, 2016 then such return would become an invalid return.

19/07/2014

simply uploading Form 16 along with basic details in http://itfiling.in/taxfile.php, you can file your return and you will receive Ack through Mail, Like this post and help others to file their income tax return

18/07/2014

01/07/2014

simply uploading Form 16 along with basic details in http://itfiling.in/taxfile.php, you can file your return and you will receive Ack through Mail, Like this post and help others to file their income tax return

03/05/2014

How to save Tax?
Salaried employees should opt for optimum tax saving salary structure to claim HRA, LTA, transport allowance, Children education allowance, hostel allowance, reimbursement of medical expenses and take perquisites, wherever possible to take tax advantage.



Submit all the expenses details to employer like, children’s Tuition fees, interest on education loan, housing loan, medical expenses, insurance premium paid receipts tax saving investment proof etc.



Invest in tax saving investment check FAQ No.4 to list of tax saving investment, kindly check the return on investment and tax saving in absolute term to select the investment. Select the investment which gives more return on investment don’t blindly invest the amount in the investment recommended by the Insurance agents, most of them will recommend the one which given the highest commission to them


Some tips
1. Life insurance. Life insurance should be taken if you are the only bread earner in your family and not on your children’s name. The sum assured should be such that if your dependent get’s that amount that amount should be in the position to replace your earning for the family so that they won’t suffer financially, if you are getting rental income or any other interest income you needs not go for any Life insurance. This is because traditional life insurance policies give very less return on income. Suggestion Go for Online term insurance which gives only death benefits and no maturity benefits. It will be very cheap approximately it will cost Rs.7,000/- to 8,000/- for Sum assured of Rs.1,00,00,000/- Selecting insurer with high claim settlement ratio.

2. Medi-claim insurance to take care of your hospital expenses. Don’t just take any insurance to save tax. it is very important to take care of your family hospital expenses, take some time to see the advantage and limitation in that policy so that it will help in future to save hospital expenses.

for more details http://itfiling.in/faq.html

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03/05/2014

What is the tax saving investments eligible for deductions AY 2014-15?
1.Life Insurance Premiums
2.Contributions to Employees Provident Fund (EPF)
3.Public Provident Fund (PPF)
4.National Savings Certificates (NSC)
5.Unit Linked Insurance Plan (ULIP)
6.Repayment of Housing Loan (Principal)
7;Equity Linked Savings Scheme (ELSS) of Mutual Funds
8.Fixed Deposit (FD) with Banks having a lock-in period of five years
9.Pension Funds
10.Senior Citizens Savings Scheme (SCSS)
11.Five years Post office Time deposit.
12.Contribution to approved annuity plan.
13.Payment of tuition fees by an individual assessee at the time of admission or thereafter to any university, college, school or other educational institutions with in India for the purpose of full time education of any two children of the individual.
14.Health insurance premium
Maximum deduction available :
a. Rs.1, 00,000/- for investment specified in serial No.1 to 13.
b. Rs.20, 000/- for expenditure specified in serial No. 14.
c. Rs.35000/- for expenditure specified in serial No. 15( For Senior citizen Rs.20,000 and for others Rs.15000/-)

update by http://itfiling.in/taxfile.php

02/05/2014

Are you a dealer under K-Vat and your yearly turnover is more Thant 50L ?

Then you have to furnishing of bill wise details in respect of purchases, sales and receipt/ dispatch of goods otherwise than by way of purchase/sales (i.e. stock transfer) electronically. This would be effective immediately commencing from the tax period May, 2014 so with in 20th June you need to upload all the details electronically along with Vat returns.

1. Effect dealers are required to upload bill wise sales and Purchase including Interstate stock transfer and consignment transfers with party TIN No and Invoice NO.
2. Department may reject the input claim if your dealer has done some mistake and I will lead too many practical difficulty.
3. Be care full in respect of TIN No while uploading the returns.
4. Mistake in TIN No will lead to selection of Case for Audit.


Reference Notification vide Circular No: CCW/CR 44/2013-14 dated 29-04-2014 issued by Department of Commercial Taxes, Karnataka


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01/05/2014

Corporate Identification Number in letter heads
Section 12(3)(c ) of the Companies Act, 2013 which has come into effect from 1st April, 2014 provides that (3) Every company shall— (c) get its name, address of its registered office and the Corporate Identity Number (CIN) along with telephone number, fax number (if any), e-mail and website addresses, if any, printed in all its business letters, billheads, letter papers and in all its notices and other official publications; and (d) have its name printed on hundies, promissory notes, bills of exchange and such other documents as may be prescribed: Provided that where a company has changed its name or names during the last two years, it shall paint or affix or print, as the case may be, along with its name, the former name or names so changed during the last two years as required under clauses (a) and (c).
If any default is made in complying with the requirements of this section, the company and every officer who is in default shall be liable to a penalty of INR 1,000 for every day during which the default continues but not exceeding INR 1,00,000/-.
Important Changes
The Corporate Identity Number which is a 21 digit number allotted by the Ministry of Corporate Affairs – this needs to be now printed in the company letter heads/ invoices and any other official documents of the company. Where there is a change in the name of the company during the last two years then the former name shall also be mentioned along with the current name. The period for which the old name should be mentioned is not specifically stated, but from the language one would infer that it is a requirement for two years. The old name should also be mentioned in the name plates which is required to be prominently affixed outside the registered office of the company. So all companies are requested to please start complying with this new requirement from 1st April, 2014 onward s.
The CIN gives a unique identity to the company. The constitution of the 21 letters is not random. Below is the constitution:


You can check the CIN number of your company on the Registration certificate or can use the following link:
http://www.mca.gov.in/DCAPortalWeb/dca/MyMCALogin.do?method=setDefaultProperty&mode=31
Type first few characters of the company name and click on search, from the list select the company, it would display the CIN No.

30/04/2014

TDS on Salaries – Section 192- Procedure to deduct TDS – Compliance with Income Tax Act and rules there under

Back Ground: Under Section 192, the employer is required to deduct income-tax while making the payment of salary during financial year to the employees, at the rate of the income-tax applicable to the individuals. For deduction of Tax at source (TDS), the tax has to be calculated according to slab wise rate. The applicable slab wise rate for deduction of tax at source will be informed through the Finance Act.

Applicable rate of Tax on income chargeable under the head “Salaries” for the financial year 2013-14 (i.e., Assessment Year 2014-15) is as follows:

Sl.No. Total Income Rate of Tax
1. Where the total income does not exceed Rs. 2,00,000/- NIL

2.Where the total income exceeds Rs. 2,00,000 but does not exceed Rs. 5,00,000/- 10 % of the amount by which the total income exceeds Rs. 2,00,000/-

3. Where the total income exceeds Rs. 5,00,000/- but does not exceeds Rs. 10,00,000/-. Rs. 30,000/- +20% of the amount by which the total income exceeds Rs. 5,00,000/-.

4. Where the total income exceeds Rs. 10,00,000/-.
Rs. 1,30,000/- + 30% of the amount by which the total income exceeds Rs. 10,00,000/-


TDS should be deducted at applicable rates as above alongs with 3% on incometax as additional deduction towards Education Cess, Secondary & Higher education cess (2% & 1% respectively).

Every person who is paying salary has to comply with the provisions of the Income tax Act and the rules made there under. The following are the steps / Points that may be following in complying with the same:

1. Declaration from Employees: Take a declaration from the employees at the beginning of the financial year i.e., April with regard to their savings, investments or sums qualified for deduction or exemption under salaries.

Points to be considered by the employer at the time of taking declarations from employees for TDS purpose:

a. Salary from more than one employer:
◦Section 192(2) deals with situations where an individual is working under more than one employer or has changed from one employer to another.
◦In Such circumstances it provides for deduction of tax at source by such employer (as the taxpayer may choose) from the aggregate salary of the employee who is or has been in receipt of salary from more than one employer.
◦The employee is now required to furnish to the present/chosen employer details of the income under the head “Salaries” due or received from the former/other employer and also tax deducted at source therefrom, in writing and duly verified by him and by the former/other employer
◦The present/ chosen employer will be required to deduct tax at source on the aggregate amount of salary (including salary received from the former or other employer).

b. Income under any other Heads:
◦Section 192(2B) enables a taxpayer to furnish particulars of income under any head other than “Salaries”. If the employee furnishes the details of any other income, then the same need to be considered at the time of deduction of TDS under salaries.
◦Not being a loss under any such head other than the loss under the head income from house property received by the assessee for the same financial year and of any tax deducted at source thereon.
◦Employee has to declare if he has gained any other income should be intimated to employee through declaration form.

2. Calculation of Taxable Salary:

Calculate the taxable salary by giving the effect of the following:

A. Allowable exemptions under Salaries

B. Deduction under Section 24(a) – Interest on Housing Loan

A. Allowable Exemptions under Salaries:

i. House Rent allowance: If the employee is receiving the House Rent allowance (HRA) and paying the Rent, then least of the following amount is to be allowed as exemption under HRA.

a) HRA Receive
b) 40% of Basis plus DA if it is part of retirement proceedings.
c) Rent Paid Less: 10% of Basic plus DA if it is part of retirement proceedings.



The lower of the above three will be allowable as exemption from HRA allowance.

Note: The Employer has to take the lease deed / rental agreement or rent paid receipt from the employee for giving the above exemption

ii. Conveyance Allowance: If the employee is receiving the Conveyance allowance for commuting between the place of residence and duty (coming to office and going back to home), a sum of Rs.800 per month or actual conveyance allowance received whichever is lower is allowable as exemption.

iii. Medical Allowance: If the employee is receiving the medical allowance is exempted Rs.1,250 per month or actual expenditure whichever is less.

iv. Uniform Allowance: When the employee is receiving the uniform allowance to meet the terms and conditions of the working culture, then the actual allowance amount or expenditure incurred on buying of the Uniform whichever is lower is exempted.

The above allowances are illustrative only. The allowances would be based on the HR policy on providing the allowances to the employees as part of salary and the exemption would be based on the provisions of the Income Tax Act and the rules made there under.

B. Deduction under Section 24(a) – Interest on Housing Loan: Section 24(b) of the Act allows deduction from income from house property on interest on borrowed capital as under:-
◦The deduction is allowed only in case of house property which is owned and in the occupation of the employee for his own residence.
◦However, if it is not actually occupied by the employee in view of his place of the employment being at other place, his residence in that other place should not be in a building belonging to him
◦The quantum of deduction allowed as per table below:

Sl.

No.
Purpose of Borrowing Capital Date of Borrowing Capital Maximum Deduction Allowable
1 Repair or renewal or reconstruction of the

house
Any time Rs. 30,000/-
2 Acquisition or construction of the house Before 01.04.1999 Rs. 30,000/-
3 Acquisition or construction of the house On or after 01.04.1999 Rs. 1,50,000/-
◦ The house so acquired or constructed should be completed within3 years from the end of the financial year in which the capital was borrowed. Hence it is necessary to acquired completion certificate of the house property against which deduction is claimed either from the builder or through self-declaration from the employee.
◦Further any prior period interest for the financial years up to the financial year in which the property was acquired and constructed shall be deducted in equal installments for the Financial year in which it was completed and subsequent four Financial years.
◦The employee has to furnish to the Employer a certificate from the person to whom any interest is payable on the borrowed capital specifying the amount of interest payable. In case a new loan is taken to repay the earlier loan, then the certificate should also show the comprehensive picture of Principal and Interest of the loan so repaid.

3. Calculation of Tax deducted at Source:After calculating the Taxable Salary as mentioned in previous steps, give the allowable deduction as given below:

Allowable Deductions under Sec. 80C to 80U

i. SEC 80C:

Section 80C, entitles an employee to deductions for the whole of amounts paid or deposited in the current financial year in the following schemes, subject to a limit of Rs. 1,00,000/-.

a. Investments in capital issues of equity shares and/or Debentures and/or Units of Mutual Funds/Public limited Companies, Engaged in developing, maintaining or operating an infrastructure/power generation or distribution/Telecom facility, approved by Central Board of direct taxes (CBDT)

b. Interest accrued on National Savings Certificates, (VIII Issue) is eligible for tax relief under Section 8OC of the Income Tax Act, 1961. The rates of interest are given behind the certificate.

c. Life insurance Premium paid

d. Contribution to statutory PF and recognized PF

e. Contribution to 15 years P.P.F.

f. Contribution towards approved superannuation fund

g. Any sum paid as subscription to Home Loan Account Scheme of the National Housing Bank

h. Any sum paid as subscription to National Saving Certificate issues

i. Contribution to ULIP of UTI

j. . Contribution to Equity – Linked Saving Scheme of a Mutual Fund/UTI

k. A) Any installment as part payment of the amount due under any self financing or other scheme of any development authorities, Housing Board engaged in the construction and sale of the house property

B) Any installment as part payment of the amount due to any company or co-operative society of which the individual is a scheme holder or member towards the cost of the house Properties.

C) Repayment of the amount borrowed by the individual from 1. Central or State Government, 2. Any Bank including Co-operative Bank, 3. LIC, 4. National Housing Bank, 5. Any Public Company with the main object of providing long term finance for Construction/purchase of houses..

l. Any amount deposited in scheduled bank fixed deposit scheme for a period exceeding 5 years.

m. Any contribution by an individual to any notified pension fund setup by notified mutual fund or UTI

n. Tuition Fees:subject to the following conditions

1) The taxpayer is an individual.

2) He has paid tuition fees. It does not include payments towards any development fees or donation or payment of similar nature

3) Such fee is paid at the time of admission or thereafter.

4) It is paid to a university, college, school or other educational institutions situated in India

5) It is paid for full time education.

6) It is paid for any two children of the taxpayer. Children may (or may not) be dependent upon the taxpayer; moreover, children may (or may not) be minor.

If the aforesaid conditions are satisfied, then the tuition fees paid per child subject to a maximum of 2 children. (Only those payments, which were made between 1st April to, 31st March has to be considered and proper receipt for the same has to be produced to the concerned disbursing officer)

ii. SEC 80CCG:

Newly inserted Section 80CCG provides deduction w.e.f. assessment year 2013-14 in respect of investment made under notified equity saving scheme. The deduction under this section is available if following conditions are satisfied.

ü The assessee is a resident individual (may be ordinarily resident or not ordinarily resident)

ü His gross total income does not exceed Rs. 10 lakhs

ü He has acquired listed shares in accordance with a notified scheme

ü The assessee is a new retail investor as specified in the above notified scheme

ü The investment is locked-in for a period of 3 years from the date of acquisition in accordance with the above scheme

ü The assessee satisfies any other condition as may be prescribed

Amount of deduction:

The amount of deduction is at 50% of amount invested in equity shares. However, the amount of deduction under this provision cannot exceed Rs. 25,000. If any deduction is claimed by a taxpayer under this section in any year, he shall not be entitled to any deduction under this section for any subsequent year.

A scheme named “Rajiv Gandhi Equity Savings Scheme (RGESS)” is being notified for the purpose of this deduction.

iii. SEC 80D:

Section 80D provides for deduction available for health insurance premia paid, etc. which is calculated as under:

Sl.No. Persons for whom payments made Nature of payment Mode of payment Allowable Deduction
Employee or

his family
1.the whole of the amount paid to effect or to keep in force an insurance on the health of the employee or his family or
2.Any contribution made to the CGHS or
3.Any payment on account of preventive health check-up of the employee or family, [restricted to Rs. 5000/-; cash payment allowed here]
any mode

other than

cash
Aggregate allowable is Rs.

15,000/{For Senior

Citizens it is Rs. 20000/-}

Parent or

Parents of

employee
1.the whole of the amount paid to effect or keep in force an insurance on the health of the parent or parents of the employee or
2.any payment made on account of preventive health check-up of the parent or parents of the employee [restricted to Rs. 5000/-; cash payment allowed here]
any mode

other than

cash
Aggregate allowable is Rs.

15,000/ than {For Senior cash Citizens it is Rs.

20000/-}


Here the employee must ensure that the medical insurance referred to above shall be in accordance with a scheme made in this behalf by-
◦the General Insurance Corporation of India formed under section 9 of the General Insurance Business (Nationalization) Act, 1972 (57 of 1972) and approved by the Central Government in this behalf; or
◦any other insurer and approved by the Insurance Regulatory and Development Authority established under sub -section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999(41 of 1999).

4. Arriving of Total Income: After giving the deduction under Section 80C to 80U, as mentioned above, from the taxable salary the arrived amount would be treated as Total Income on which the TDS need to be deducted.

5. Calculation of Tax: After giving the deduction under Section 80C to 80U, as mentioned above, calculate the tax according to slab wise.

6. Rebate under section 87A: After arriving the tax liability, if the net income of the employee does not exceed Rs.5,00,000, a rebate of Rs.2,000 before adding Secondary and Higher Education cess or tax liability whichever is lower need to be given as rebate.

7. Deduction of TDS from Salaries: The TDS as calculated according to the previous steps, deduct the TDS by calculating average for 12 months, then deduct the TDS on monthly basis.

8. Obtain Confirmations / Proofs for investments or Savings: During the month of December or January, the employer has to obtain the proofs for the savings or investments made by the employee. If the employee has not submitted or not invested as given in his declaration, then calculate the Tax assuming the employee has not invested or done any savings and accordingly deduct the balance TDS from his salary before the payment of Salary.

9. Depositing of TDS deducted: The employer has deposit the TDS which was deducted from the Salaries. The due date for the same are, for the month of April to Feb of the Financial year the due date is 7th of the subsequent month in which the TDS was deducted. For example in the month of April 2014 if TDS was deducted the same should be remitted to the Government account by before 7th of May 2014. 30th April with respect to TDS for the month of March.

10. Filing of E-TDS Returns: The Employer has to file the E-TDS return in Form-24Q for each quarter. The following are the due dates for filing of the online E-TDS returns.

PERIOD DUE DATE OF FILING
April to June 15TH JULY
July to September 15th OCTOBER
October to December 15th JANUARY
January to March 15th MAY

11. Issue of Form-16 to the Employees: The Employer has to issue the Form-16 along with Form – 12BA to the respective employees on or before 31st May (after ending of the financial year).