Friends, Major effects in Budget 2012-13 on Income Tax on Individuals are detailed given below :-
- Personal Income Tax rates rationalized. Basic exemption limit to be increased to Rs. 2 Lakh for both women and men, thereby removing gender discrimination. 30% rate of income tax to be attracted in respect of total income above Rs. 10 Lakhs.
- Deduction of up to Rs. 10,000 in respect of interest on savings account in bank, post office or co-operative society engaged in the business of banking.
- Deduction of up to Rs. 5,000 in aggregate for preventive health check-up of the assessee, his family and parents. This is within the overall limit specified under section 80D. However, payment for preventive health check-up can also be made in cash to qualify for deduction.
- Senior citizens not having business income to be exempted from payment of Advance Tax.
- Age of senior citizen for availing higher deduction for medical insurance premium, medical treatment of a specified disease or ailment, etc. to be aligned with the reduced age of 60 years for availing higher basic exemption limit of Rs. 2,50,000 applicable to senior citizens.
- Deduction under section 80C in respect of Life Insurance Premium paid to be allowed for only so much of premium as does not exceed 10% of the actual capital sum assured, in respect of policies issued on or after 1st April, 2012. Currently, the limit is 20% of actual capital sum assumed.
- Further, exemption under section 10(10D) in respect of any sum received under a life insurance policy issued on or after 1st April, 2012, would be available only where the premium payable for any of the years during the life of the policy does not exceed 10% of actual capital sum assured.