Rates for Individuals:
of the amt exceeding 50,000
+ 20% of the amt exceeding 60,000
30% of the amt exceeding 1,5,0000
In the case of every Individual, Hindu undivided family, Association
of person and body of individuals, Surcharge on income-tax is calculated
@10% if the total taxable income exceeds Rs.8,50,000. The Surcharge
is calculated on the net tax. (Tax as reduced by rebate u/s.88, 88B,
88C & 88D but before giving relief u/s.89(1).
of Income-tax and Surcharge shall be further increased by Education
Cess of 2% on Income-tax plus Surcharge.
/ DEDUCTIONS FROM SALARY:
a) Rs.30,000 or 40% of Salary whichever is less for Gross Salary
Rs.5,00,000 or below.
b) Rs.20,000 for Gross Salary exceeding Rs.5,00,000 .
House Rent Allowance Exempt u/s. 10 (13A)
Actual HRA received :
paid in excess of 10% of Salary :
of Salary in Metro Cities or
of Salary in other Cities :
of a), b), c) is excempt
Here Salary means Basic Salary as well as DA if the terms of employment
Any allowance granted to meet the expenditure incurred wholly, necessarily
and exclusively on conveyance in performance of the duties of office
and so certified by the employer is exempt u/s.10(14).
Any allowance granted to an employee to meet the expenditure for the
purpose of commuting between the place of his residence and the place
of his duty to the extent upto Rs.800/- per month is exempt u/s.10(14).
An amount of Rs.15,000 or the actual amount reimbursed by the employer
whichever is less is exempt u/s.17(2)(v).
FROM HOUSE PROPERTY:
out property, deduction of 30% of the Net Annual Value is allowed.
No separate deduction for Repairs, Collection Charges, Insurance Premium,
Annual Charge and Ground Rent.
ON BORROWED LOAN(U/S.24(b)):
FOR SELF OCCUPIED PROPERTY
a) If Property is acquired or constructed with loan taken after 01/04/99
and construction is completed within 3 years from date of loan
Rs.1,50,000 or actual whichever is less is deductible.
b) If new housing loan is taken for repayment of old loan (old loan
taken after 1/4/99) Rs.1,50,000 or actual interest payable
whichever is less is allowed as deduction.
c) If Property is acquired or constructed with loan taken before 01/04/99,
Rs.30,000 or actual interest payable whichever is less is allowed
d) If loan taken for Repairs, renewal, reconstruction of property,
Rs.30,000 or actual interest payable which ever is less is allowed
FOR LET OUT PROPERTY, interest paid/payable can be claimed
FROM CAPITAL GAINS:
The Capital Gain arising out of sale of long term capital asset can
be invested in National Bank for Agriculture and Rural Development,
National Highways Authority of India, Rural Electrification Corporation
Limited, National Housing Bank or Small Industries Development Bank
of India within six months from the date of sale. (Lock-in period
is 3 years)
The Cost Inflation Index for the Financial Year 2004-05 is
Deduction For Family Pension u/s.57(iia):
An amount of Rs.15,000 or 331/3% of family pension whichever is less
is allowed as deduction. If an assessee receives arrears of family
pension, then Relief u/s.89(1) can be claimed by him.
Family Pension received by the widow or children or nominated heirs,
as the case may be, of a member of the armed forces(including para-military
forces) of the union, where the death of such member has occurred
in the course of operation is exempt.
FROM GROSS TOTAL INCOME (CHAPTER VIA):
Any sum paid by cheque to keep in force an insurance on health of
the assessee or his dependants in accordance with the scheme framed
by the General Insurance Corporation of India or any other insurer
and approved by the Insurance Regulatory and Development Authority,
upto Rs.10,000 is allowed as deduction. Where the premium is paid
in respect of a Senior Citizen, the permissible deduction will be
The amount a) of expenditure incurred by way of medical treatment,
training and rehabilitation of a handicapped dependant or b) paid
or deposited under any scheme framed in this behalf by the LIC or
UTI or any other insurer and approved by the Board for the maintenance
of the handicapped dependant, shall be allowed as a deduction up to
Rs.50,000 either under (a) or (b) or aggregate of (a) & (b) on
the production of a certificate from the Government hospital in the
prescribed form and manner, along with the return of income u/s.139
in respect of the assessment year for which the deduction is claimed.
Where such dependant is a person with severe disability, a deduction
of Rs.75,000 can be claimed.
If any amount is actually paid for the medical treatment of specified
diseases or ailments of the assessee or his dependants, then, a deduction
of the amount actually paid or Rs.40,000 whichever is less is allowable
on the production of a certificate in Form No.10-I, issued by a Neurologist,
an Oncologist, a Urologist, a Hematologist, an Immunologist or such
other specialist as may be prescribed, working in a Government Hospital,
while filing the Return of Income. If the expenditure is incurred
in respect of Senior Citizen, the limit of deduction is Rs.60,000.
The deduction shall be reduced by the amount received, if any, under
Applicable to Individuals only. Any amount paid by the assessee in
the previous year out of his income chargeable to tax by way of repayment
of loan, taken by him from any financial/approved Charitable Institution
for the purpose of pursuing his higher education or interest on such
loan is eligible for a deduction not exceeding Rs.40,000.
An assessee not in receipt of HRA incurs any expenditure on rent,
is allowed a deduction of least of the following :
a) Rent paid in excess of 10% of the total income
b) 25% of the total income
c) Rs.2,000 per month
Note: Total Income means Total Income before allowing deduction
under this section.
The above deduction is allowable only if the assessee or spouse or
minor child does not own a house in the place of employment/business.
To claim such a deduction, the assessee should file a declaration
in Form No.10BA.
Applicable to Individual and HUF. A deduction of up to Rs.12,000 is
available in respect of certain interest incomes, Post office MIS
etc. An additional deduction of Rs. 3000/- is available if income
includes interest on Government Securities.
Any income by way of Dividends from company, Income received in respect
of units from the Unit Trust of India, Income received in respect
of the units of a mutual fund are exempt.
Any assessee suffering from a permanent physical disability (including
blindness) or is subject to mental retardation, on the production
of medical certificate from Government Hospital in the prescribed
form and manner, along with a Return of Income, shall be allowed
a deduction of Rs.50,000. Where such assessee is a person with severe
disability, a deduction of Rs.75,000 can be claimed.
DEDUCTIBLE FROM GROSS TAX (CHAPTER VIII A):
u/s.88 Applicable For Individual & HUF:
The qualifying amount for calculation of Rebate to be deducted from
gross tax is Rs.70,000 comprising of contributions toward PF, PPF,
LIC Premium, NSC, Repayment towards Principal on Housing loan upto
Rs.20,000, Tuition fees of Rs.12,000 per child to the maximum of two
children etc. An additional amount of Rs.30,000 is available when
such sum is invested in specified investments.
a) Gross Total Income less than or equal to Rs.1,50,000/-, a Rebate
of 20% of qualifying amount.
b) Gross Total Income more than Rs.1,50,000/- and less than or equal
to Rs.5,00,000/-, a Rebate of 15% of qualifying amount.
c) Gross Total Income exceeds more than Rs.5,00,000/-, Rebate is NIL
Total Income means Income before giving effect to deduction under
u/s. 88B for Senior Citizens:
For a resident individual who has attained the age of 65 years or
more, at any time during the previous year is entitled to a deduction
of 100% of the income-tax or Rs.20,000 whichever is less from the
u/s. 88C for women below the age of 65years
A resident woman individual below the age of 65 years is entitled
to a deduction of Rs.5,000 or actual tax payable whichever is less
from the tax payable.
A resident individual whose total income does not exceed Rs.1,00,000
before allowing any other Rebate is eligible for Rebate of 100% of
Income-tax. However, where the total income exceeds Rs.1,00,000, Rebate
u/s.88D will be available as calculated under if total income is below
A) Calculate tax on Total Income before Rebate
B) Calculate the difference between total income and Rs.1,00,000
C) Rebate u/s.88D = A - B
If a person who is required to furnish a return of income as required
under section 139(1) or by the proviso to sub-section, fails to furnish
such return before the end of the relevant assessment year, shall
be liable to pay by way of penalty a sum of Rs.5,000.
Where the return of Income of any assessment year u/s.139(1) or 139(4)
or in response to a notice u/s.142(1), is furnished after the due
date as specified in sub-section 1 of section 139, or is not furnished,
the assessee shall be liable to pay simple interest at the rate of
one percent for every month or part of a month comprised in the period
commencing on the date immediately following the due date.
Where an assessee who is liable to pay advance tax under section 208
has failed to pay such tax or, where the advance tax paid by such
assessee under the provisions of section 210 is less than 90% of the
assessed tax, the assessee shall be liable to pay simple interest
at the rate of one percent for every month or part of a month comprised
in the period from the 1st day of April following the financial year.
Where an assessee other than a Company, who is liable to pay advance
tax under section 208 has failed to pay such tax or,
1) The advance tax paid by the assessee on his current income on or
before the 15th day of September is less than 30% of the tax due on
the returned income or the amount of such advance tax paid on or before
the 15th day of December is less than 60% of the tax due on the returned
income, then, the assessee shall be iable to pay simple interest at
the rate of one percent per month for a period of three months on
the amount of the shortfall from 30% or, as the case may be, 60% of
the tax due on the returned income.
2) The advance tax paid by the assessee on his current income on or
before the 15th day of March is less than the tax due on the returned
income, then, the assessee shall be liable to pay simple interest
at the rate of one percent on the amount of the shortfall from the
tax due on the returned income.
Dates for Filing Return of Income:
All Individuals/HUF/Firms deriving Income from Salary, House Property,
Capital Gains, Business or Other Sources and not covered under section
44AB are required to file the Return of Income by 31st July. All
Tax Audit Cases covered under section 44AB, Company returns and
persons satisfying any one of the Six Economic Criteria (2C) are
required to file the Return of Income by 31st October.
Every assessee is required to obtain 10 Alpha numeric Permanent
Account Number (PAN) and quote the same in his returns, challans
& correspondence. PAN can be obtained by applying in new Form
No.49A at the designated Service Centres of UTIISL OR NSDL(Log
on to our website). PAN is essential for processing the Return
of Income and for giving credit for taxes paid. If a person
who is required to quote his Permanent Account Number fails to do
so or intimates false number, the Assessing Officer may direct that
such person shall pay, by way of penalty, a sum of Rs.10,000.
Advance tax payments and Self-assessment tax payments have to be
made in Challan No.280. Please obtain counterfoil of challan containing
Challan Identification Number (CIN) from the Bank and enclose
copy of the same with the return or quote CIN in the return.
brochure should not be construed as an exhaustive statement of law.
In case of doubt, reference should always be made to the relevant
provisions of Income Tax Act, Rules or Notifications.
further information, please contact:
Public Relations Officer
Income-tax Department, C.R.Building, Queen's Road,
Bangalore-560 001. e-mail : email@example.com
Website : www.incometaxbangalore.in