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Income Tax Planning for
Financial Year-2016-17
Assessment Year-2017-18
131-01-2017 Department of Management Studies RGIPT
...
Income Tax Slab Rate for Individual/HUF:
Tax Slab
For Men/ Women For Senior Citizen For Super Senior Citizen
Below 60 Year...
Various Deduction and their Limit:
31-01-2017 Department of Management Studies RGIPT 3
Section 80C
Limit: Rs 1.5Lakh
Secti...
Section 80C investment avenues or expenses:
PPF
EPF
FD (Bank or Post office)
NSC
ELSS Mutual Fund
Children Tuition F...
Section 80CCD (1B)
Employee can contribute to Government notified Pension Schemes
(like National Pension Scheme – NPS).
Th...
Section 80D:
Health Insurance Policy Premium Tax benefit
Scenario
Health Insurance Premium paid for & Max. tax
deduction l...
Section 24 (B):
• The interest component of home loans is allowed as deduction under
Section 24B for up to Rs 2 lakh in ca...
Section 80EE:
• This is a new proposal which has been made in Budget 2016-17. First
time Home Buyers can claim an addition...
Section 80GG:
As per the budget 2016 proposal, the Tax Deduction amount
under 80GG has been increased from Rs 24,000 per a...
Section 80E:
If you take any loan for higher studies (after completing Senior
Secondary Exam), tax deduction can be claime...
Section 80TTA:
Deduction from gross total income of an individual or HUF, up to a
maximum of Rs. 10,000/-, in respect of i...
Section 16:
Professional Tax paid during financial either state or central govt. or
both are come under 100% tax deduction...
Section 87A:
If your earning below Rs 5 lakh, you can save additional Rs 5,000 in
taxes. Tax rebate under Section 87A has ...
Example:
Income from salary / business or profession / other sources Rs. 7,65,000
Less : Interest on funds borrowed for aq...
Expected Income Tax Slab Rate for
Individual/HUF:
Tax Slab
For Men/ Women For Senior Citizen For Super Senior Citizen
Belo...
Various Expected Deduction and their Limit:
31-01-2017 Department of Management Studies RGIPT 16
Section 80C
Limit: Rs 2La...
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Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction for financial year 2017-18

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Income Tax Slab and Tax Planning for F.Y-2016-17, Assessment Year 2017-18 and Expected Tax slab for financial year 2017-18, Keeping all the burden on government in mind like OROP (16000Crore), 7th Pay Commission(1.2Lakh Crore) etc.

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Income Tax Planning for financial Year 2016-17 & Expected Slab and deduction for financial year 2017-18

  1. 1. Income Tax Planning for Financial Year-2016-17 Assessment Year-2017-18 131-01-2017 Department of Management Studies RGIPT Vivek Kumar M1617 “Tax Planning is not a goal but a tool”
  2. 2. Income Tax Slab Rate for Individual/HUF: Tax Slab For Men/ Women For Senior Citizen For Super Senior Citizen Below 60 Years of age Age 60 years or more but less than 80 years Age 80 years or more Income Level Tax Rate Income Level Tax Rate Income Level Tax Rate 0 Up to Rs 2,50,000 Nil Up to Rs 3,00,000 Nil Up to Rs 5,00,000 Nil I Rs. 2,50,001- Rs.5,00,000 10% Rs. 3,00,001- Rs.5,00,000 10% Rs. 5,00,001- Rs.5,00,000 20% II Rs. 5,00,001- Rs.10,00,000 20% Rs. 5,00,001- Rs.10,00,000 20% Above Rs. 10,00,000 30% III Above Rs. 10,00,000 30% Above Rs. 10,00,000 30% 31-01-2017 Department of Management Studies RGIPT 2
  3. 3. Various Deduction and their Limit: 31-01-2017 Department of Management Studies RGIPT 3 Section 80C Limit: Rs 1.5Lakh Section 80D Limit: Rs 30K/30K Section 80CCD (1B) Limit: Rs 50K Section 24B Limit: Rs 2Lakh Section 80EE Limit: Rs 50,000 Section 80GG Limit: Rs 60K Section 80E Limit: NA Section 80TTA Limit: Rs 10K Section 16 Limit: NA Section 87A Limit: Rs 5K
  4. 4. Section 80C investment avenues or expenses: PPF EPF FD (Bank or Post office) NSC ELSS Mutual Fund Children Tuition Fee Principle repayment of Home Loan Life Insurance Premium 31-01-2017 Department of Management Studies RGIPT 4
  5. 5. Section 80CCD (1B) Employee can contribute to Government notified Pension Schemes (like National Pension Scheme – NPS). The contributions can be up to 10% of the salary (or) Gross Income and Rs 50,000 additional tax benefit u/s 80CCD (1b) was proposed in Budget 2015. 31-01-2017 Department of Management Studies RGIPT 5
  6. 6. Section 80D: Health Insurance Policy Premium Tax benefit Scenario Health Insurance Premium paid for & Max. tax deduction limit Tax Deduction under Section 80DSelf, Spouse & Dependent Children Parents (whether dependent or not) No one in your family attained 60years of age Up to Rs 25,000 Up to Rs 25,000 Rs 50,000 Only parent are above 60 years of age Up to Rs 25,000 Up to Rs 30,000 Rs 55,000 Eldest member of family and parent are above 60years of age Up to Rs 30,000 Up to Rs 30,000 Rs 60,000 31-01-2017 Department of Management Studies RGIPT 6
  7. 7. Section 24 (B): • The interest component of home loans is allowed as deduction under Section 24B for up to Rs 2 lakh in case of a self-occupied house. • If your property is a let-out one then the entire interest amount can be claimed as tax deduction 31-01-2017 Department of Management Studies RGIPT 7
  8. 8. Section 80EE: • This is a new proposal which has been made in Budget 2016-17. First time Home Buyers can claim an additional Tax deduction of up to Rs 50,000 on home loan interest payments u/s 80EE. The below criteria has to be met for claiming tax deduction under section 80EE. • Loan amount should be less than Rs 35 Lakh. • The value of the house should not be more than Rs 50 Lakh & • The home buyer should not have any other existing residential house in his name. 31-01-2017 Department of Management Studies RGIPT 8
  9. 9. Section 80GG: As per the budget 2016 proposal, the Tax Deduction amount under 80GG has been increased from Rs 24,000 per annum to Rs 60,000 per annum. Section 80GG is applicable for all those individuals who do not own a residential house. The extent of tax deduction will be limited to the least amount of the following; • Rent paid minus 10 percent the adjusted total income. • Rs 5,000 per month. • 25 % of the total income. 31-01-2017 Department of Management Studies RGIPT 9
  10. 10. Section 80E: If you take any loan for higher studies (after completing Senior Secondary Exam), tax deduction can be claimed under Section 80E for interest that you pay towards your Education Loan. This loan should have been taken for higher education for you, your spouse or your children or for a student for whom you are a legal guardian. 31-01-2017 Department of Management Studies RGIPT 10
  11. 11. Section 80TTA: Deduction from gross total income of an individual or HUF, up to a maximum of Rs. 10,000/-, in respect of interest on deposits in savings account with a bank, co-operative society or post office can be claimed under this section. 31-01-2017 Department of Management Studies RGIPT 11
  12. 12. Section 16: Professional Tax paid during financial either state or central govt. or both are come under 100% tax deduction. 31-01-2017 Department of Management Studies RGIPT 12
  13. 13. Section 87A: If your earning below Rs 5 lakh, you can save additional Rs 5,000 in taxes. Tax rebate under Section 87A has been raised from Rs 2,000 to Rs 5,000 for FY 2016-17 (AY 2017-18). In case if your tax liability is less than Rs 5,000 for FY 2016-17, the rebate u/s 87A will be restricted up to income tax liability only. 31-01-2017 Department of Management Studies RGIPT 13
  14. 14. Example: Income from salary / business or profession / other sources Rs. 7,65,000 Less : Interest on funds borrowed for aquiring the house property Rs. 2,00,000 Gross Total income Rs. 5,65,000 Less : Deduction available under Sec. 80C Rs. 1,50,000 Less : Deduction u/s 80CCD(1B) (Contribution to NPS scheme) Rs. 50,000 Less : Deduction u/s 80D for medical insurance of self, spouse and dependent children Rs. 25,000 Less : Deduction u/s 80D for medical insurance of parents (assumed both are senior citizens) Rs. 30,000 Less : Deduction u/s 80TTA for Saving account interest Rs. 10,000 Total Income Rs. 3,00,000 Tax payable Rs. 5,000 Less : Rebate u/s 87A Rs. 5,000 Net Income Tax Liability Nil 31-01-2017 Department of Management Studies RGIPT 14
  15. 15. Expected Income Tax Slab Rate for Individual/HUF: Tax Slab For Men/ Women For Senior Citizen For Super Senior Citizen Below 60 Years of age Age 60 years or more but less than 80 years Age 80 years or more Income Level Tax Rate Income Level Tax Rate Income Level Tax Rate 0 Up to Rs 3,00,000 Nil Up to Rs 3,50,000 Nil Up to Rs 6,00,000 Nil I Rs. 3,00,001- Rs.5,00,000 10% Rs. 3,50,001- Rs.5,00,000 10% Rs. 5,00,001- Rs.5,00,000 20% II Rs. 5,00,001- Rs.10,00,000 20% Rs. 5,00,001- Rs.10,00,000 20% Above Rs. 10,00,000 30% III Above Rs. 10,00,000 30% Above Rs. 10,00,000 30% 31-01-2017 Department of Management Studies RGIPT 15
  16. 16. Various Expected Deduction and their Limit: 31-01-2017 Department of Management Studies RGIPT 16 Section 80C Limit: Rs 2Lakh Section 80D Limit: Rs 30K/30K Section 80CCD (1B) Limit: Rs 50K Section 24B Limit: Rs 2Lakh Section 80EE Limit: Rs 50,000 Section 80GG Limit: Rs 60K Section 80E Limit: NA Section 80TTA Limit: Rs 10K Section 16 Limit: NA Section 87A Limit: Rs 5K

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