Saturday, February 2, 2013

Deduction for Salaried Employees

 Deduction is major question for salaried employees.  Each employee wants to know that what type of deduction can be claimed by him to avoid deduction of Income Tax from his salaries.  Keeping in view of these things all Deductions are framed below to watch the All deductions relating to Salaried Employees. 

Deductions at a Glance to Salaried assessee
Serial No’s
Assessee to whom allowed
Quantum of Deduction
Deduction in respect of contribution to certain pension funds
Only Individuals
Max. Rs. 1,00,000
Deduction in respect of contribution to new pension scheme
Any employee or a self-employed person
In case of employees maximum 10% of salary and in case of self-employed persons 10% of Gross Total Income
Limit of deduction u/s. 80C,80CCC and 80CCD (only employees contribution to New Pension Scheme to be included for the limit of Rs. 1,00,000)
Individual or HUF
Max. Rs. 1,00,000
Deduction in respect of Long-Term infrastructure bonds.
Individuals or HUF
Max. Rs. 20,000.  Removed w.e.f.  F.Y. 2012-13
Deduction in respect of medical insurance premia w.e.f. A.Y. 2011-12 any contribution made to the Central Government Health Scheme (CGHS) shall also be eligible for deduction
Individual or HUF whether resident or non-resident.
In Case of Individuals
(i) For individual himself, spouse and dependent children   Rs. 15,000
For parents of the individuals, whether dependent or not. RS. 15,000
In case of HUF   Rs. 15,000
Note:- Addl. Rs. 5,000 if any of the above person insured is a senior citizen.
Rule 11A
Deduction in respect of maintenance including medical treatment of person with physical disability.
Individual or HUF resident in India:
1)      With disability

2)      With severe disability.

Rs. 50,000

Rs. 1,00,000

Rule 11DD
Deduction in respect of medical treatment etc.
Individual or HUF resident in India
For senior citizen
Rs. 40,000

Addl. Rs. 20,000

Deduction for interest paid on loan taken for pursuing his higher education or for the purpose of higher education of his relative.  Higher education shall cover all post schooling courses.
“Relative” means the spouse and children of the individual.
Individual whether resident or not.
Actual amount paid.
80G/Rules 11AA & 18AAA
Deduction in respect of donations to certain funds, charitable institutions, etc.
All assesses
(a)    100% or 50% of eligible donations, without applying qualifying limit in certain cases.
(b)   100% or 50% of eligible donations, after applying Qualifying limit of 10% of adjusted GTI.
80GG and Rule 11B
Deductions in respect of Rent Paid
Individual only
Max. Rs. 2,000 p.m.
Deduction in respect of certain donations for scientific research or rural development, etc. w.e.f A.Y. 2011-12 donations to any research association will be eligible for deduction.
All assesses no having business income.
100% of sum donated.
Deduction in respect of contribution to political parties/Electoral Trust
All assesses (except local authority and artificial judicial person)
100% of sum contributed.
Deduction in respect of royalty income, etc. of authors of certain books other than text books.
Individuals who are residents in India and are authors.
Actual income or Rs. 3,00,000 whichever is less.
Deduction in respect of royalty on patents.
Individual who is resident in India and is a patentee.
100% of such income or Rs. 3,00,000 whichever is less.
80U/Rule 11D
Deduction in the case of permanent physical disability (including blindness)
Resident Individual:
Rs. 50,000 in case of a per with disability.
Rs. 1,00,000 in case of a person with a severe disability.

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