Income Tax Calculation

 It is mandatory for every employee to choose one of the two options 

 

(TDS to be deducted as per NEW TAX SLAB RATE) 

                                     OR                                   

(TDS to be deducted as per OLD TAX SLAB RATE) 

 

So that the tax can be computed and deducted accordingly. This option can be exercised only once in a financial year and cannot be changed within that financial year. 

Income Tax rate mentioned below as per your Income Range

NEW TAX SLAB RATE
Income Range	Tax Rate
Upto Rs. 2,50,000.00	NIL
Rs. 2,50,001 to Rs. 5,00,000.00	5% (Tax rebate of Rs. 12,500.00 U/s. 87A is allowed)
Rs. 5,00,001.00 to Rs.7,50,000.00	10%
Rs.7,50,0001.00 to  Rs.10,00,000.00	15%
Rs. 10,00,001.00 to Rs. 12,50,000.00	20%
Rs. 12,50,000.00 to Rs. 15,00,000.00	25%
Rs. 15,00,000.00 and above	30%
OLD TAX SLAB RATE
Income Range	Tax Rate
Up to Rs. 2,50,000.00	NIL
Rs.2,50,001 to Rs. 5,00,000.00	5% (Tax rebate of Rs. 12,500.00 U/s. 87A is allowed)
Rs. 5,00,001.00 to Rs. 10,00,000.00	20%
Rs.10,00,000.00 and above	30%

 

Exemptions and deductions are not allowed under NEW TAX SLAB Rate. 

 You Can Save your Income tax by using below Sections under Old Tax SLAB Rate

 

Under 80 C - Limit 1,50,000/-

 

Life Insurance Premium Paid 

a. All the Receipts should be dated in between Current financial Year. 

b. The policy should be in the name of Self, Spouse and Children only.

Contributions/Deposits in Public Provident Fund A/c - 

a. The Contribution should be in the name of Self, Spouse and Children only.

 

Investments in NSC VIII issue

 

Contribution made to Unit linked Insurance plan of UTI/LIC

 

Contribution made to Mutual Fund/UTI

 

Amount spent on Children Education towards tuition fee only (maximum of 2 Children)

 

Annual Repayment of Housing loan - (Mention your Home Loan Principal Amount only)

 

Investments in Infrastructure Companies

 

Premium Paid towards Jeevan Suraksha(U/S 80 ccc)

 

Amount deposited for 5years or more  in schedule banks and 5 years time deposit scheme in post office under Income Tax benefit scheme (Please confirm with Bank and Post office)

 

Sukanya Samriddhi Yojana

 

Deposit in NSS

 

Deposit in Post Office Savings Schemes

 

Equity Linked Savings Scheme ( ELSS )

 

Kisan Vikas Patra (KVP)

 

Long term Infrastructure Bonds

 

NABARD Rural Bonds

 

National Pension Scheme

 

Stamp duty and Registration charges

 

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS 80D

 

Mediclaim for Self and Family = 25,000

Mediclaim For Parents < 60 = 25,000

Mediclaim For Parents > 60 = 50,000

Medical Bills - In case of Senior Citizen Age 65years and above = 50,000

Health Checkup - Dependent Parents Age < 60 =  25,000

Health Checkup - Dependent Parents Age > 60 = 50,000

 

  

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80DDB

 

Medical Treatment ( Specified Disease only ) - 40000

 

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80CCD1(B)

 

Contribution to NPS 2015 = 50,000

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80CCD(2)

 

Employer Contribution to NPS = 7,50,000  

(10 % of Annual Basic Salary) - (Annual Employee PF)

= Employer Contribution to NPS (Max Limit 7,50,000)

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - Section -24

 

Interest on Housing Loan  = 2,00,000

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80EE

 

Additional Interest on housing loan borrowed as on 1st Apr 2016  = 50,000

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80EEA

 

Additional Interest on Housing loan borrowed as on 1st Apr 2019 = 1,50,000

 

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80EEB

 

Interest on Electric Vehicle borrowed as on 1st Apr 2019 = 1,50,000

 

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80TTB

 

Interest on Deposits in Savings Account, FDs, Post Office And Cooperative Society for Senior Citizen = 50,000

 

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80G

 

Donation - Children Education - 9,99,99,999

Donation - Political Parties - 9,99,99,999

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80TTA

 

Interest on Deposits in Savings Account, FDs, Post Office And Cooperative Society = 10,000

 

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80E

 

Interest on Loan of higher Self education = 9,99,99,999

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80U

 

Permanent Physical Disability (Above 80%) = 1,25,000

Permanent Physical Disability (Between 40% - 80%) = 75,000

 

INVESTMENTS/EXPENDITURE UNDER SECTIONS  - 80CCG

 

Rajiv Gandhi Equity Scheme = 25000

 

 

Exemptions - Under Section 10 (13A)

 

House Rent Allowance = Actual HRA received

                                                    or

                                          40% of salary (50% of the salary if the rented property is in Metro City 

                                          i.e. Mumbai, Delhi, Chennai or Kolkata)

                                                                or

                                          Actual rent paid less 10% of salary

                                                              

                                           Whichever is Lower

Example

Basic Salary + Dearness Allowance (Rs 1,00,000 * 12) = 12,00,000

HRA (Rs 45,000 *12)

Rent of house in Mumbai (Rs 30,000 * 12)

Answer - 

A - HRA received - 5,40,000

B - 50% of the salary as the rented property is in metro city - 6,00,000

C - Actual rent paid less 10% of salary (3,60,000 – 1,20,000) -= 2,40,000

HRA Exempt under section 10(13A) (least of the above) = 2,40,000

 

Additional Health and Education cess @ 4% on tax amount. Surcharge as applicable. 

 

Surcharge : Surcharge is levied on the amount of income-tax at following rates if total income of an assessee exceeds specified limits:-

 

Rs. 50 Lakhs to Rs. 1 Crore = 10%

Rs. 1 Crore to Rs. 2 Crores = 15%

Rs. 2 Crores to Rs. 5 Crores = 25%

Rs. 5 crores to Rs. 10 Crores = 37%