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Know More About Tax Deduction In India

The Indian government imposes tax on income earned by the individuals, HUF (Hindu Undivided Families), business men, and companies on a yearly basis. The rate of these taxes is decided from time to time annually in the Union Budget presented in last week of February by the Finance Minister.

Income Tax Slabs for the FY 2013-14 was presented on 28th Feb 2013 by the Finance Minister with the following features

(1)      There is no change in the Tax slab for Women and Senior citizen from the previous FY i.e. 2012=13.

(2)      No change in amount has been incorporated in the 10%, 20%, and 30% slab rates.

(3)      The tax slab for male Indian citizen below the age of 60 has been raised fromRs.1,80,00 to 2,00,00 providing a tax benefit of Rs 2,000.

(4)      The tax exemption of Rs 20,000 on tax saving infrastructure bonds has been retained in the present tax structure.

(5)      The standard Tax exemption on savings made under various sections of Income Tax has been maintained at RS. 1,00,000.

Standard sections of Income Tax rules which can benefit the Tax Payer

  • Section 80C - Investments in PPF/GPF/EPF, Post Office Fixed deposit for five years, Life Insurance Policies, Mutual Funds, National Saving Certificate, Principal part of Housing Loan availed etc qualify for combined Rs. 1,00,000 exemptions under this section.
  • Section 80D - Mediclaim policies provide a maximum exemption of Rs 35,000 apart from the savings under Section 80C.
  • Section 80G - Donations of 10% of amount made to registered institutions and relief organizations, registered religious places are exempted under this section
  • Section 24: Interest paid on Housing Loan availed during the Financial Year up to a maximum of Rs. 1,50,000 is exempted from the income tax and this deduction is in addition to the deductions made under other sections of Income tax.

Tax Deduction in India and Tax filing

Tax is deducted at source for the Individuals by the employer after calculating the total tax and dividing  it into monthly installments. These taxes collected get deposited with Income Tax department on a quarterly basis. All the Tax Payers are required to submit return in the relevant ITR form by the end of 31st Jul every year. This is called as Tax filing.

So, try to know more and more information about Income Tax rules, slabs and Filing returns to enjoy the benefits offered by various sections.

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