Charge to Income-Tax PPT

8/2/2019 Charge to Income-Tax PPT

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WELCOME TO ALL


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Charge to Income-tax

Everyone exceeds the maximum amount whichis not chargeable to the income tax is an assessee,and shall be chargeable to the income tax at the

rate or rates prescribed under the finance act forthe relevant assessment year, shall be determinedon basis of his residential status.

Income tax is a tax payable, at the rate enacted by

the Union Budget (Finance Act) for everyAssessment Year, on the Total Income earned inthe Previous Year by every Person.


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Tax Rates

In India, Individual income tax is a progressive tax

with three slabs. About 10 per cent of the populationmeets the minimum threshold of taxable income

From April 1, 2011 new tax slabs apply, which are asfollows:


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Income tax slabs (in Rs) 2011-2012

General Women

Senior

Citizen

Very Senior

Citizen

Tax

pplicable

0 to

1,80,000

0 to

1,90,000

0 to

2,50,000

0 to

5,00,000 No Tax

1,80,001 to

5,00,000

1,90,001 to

5,00,000

2,50,001 to

5,00,000 - 10%

5,00,001 to

8,00,000

5,00,001 to

8,00,000

5,00,001 to

8,00,000

5,00,001 to

8,00,000 20%

Above

8,00,000

Above

8,00,000

Above

8,00,000

Above

8,00,000 30%


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Heads of Income

The total income of a person is divided intofive heads, viz., taxable

Income from Salary

Income from House property

Income from Business or Profession

Income from Capital Gains

Income from Other Sources


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Exemptions:

1) 80 C Limit Unchanged (Rs.1,00,000)(refer to our earlier blog for alloptions under section 80 C

2) 80 CCF

Additional Rs. 20,000 oninvestments towards approvedInfrastructure bonds

3) 80CCD:

Contribution to NPS and returns on NPStax free, but withdrawal still taxable


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4) 80 D

Mediclaim Premium on the Health of

a) Self Spouse and Children

Rs. 15,000

b) Parent/Parents

Rs. 15,000

c) If Parent/ Parents Senior citizen

Rs. 20,000


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5) Section 80DD

Deduction under section 80DD

Exemption given for Expenditure made for a

disabled dependant towards MedicalTreatment/Training/Rehabilitation. It alsoincludes the LIC/Insurance premium paid towardsmaintenance of such dependant.

Maximum deduction allowed is Rs. 50,000/- incase of normal disability and Rs. 1 Lakh in caseof severe disability.


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6) 80DDB

Deduction under section 80DDB

Exemption given for expenditure incurred onspecified disease or ailments such as

cancer/aids.

Maximum deduction allowed is Rs. 40,000/-.In case of Senior Citizens, maximum

deduction allowed is Rs. 60,000/-


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7) Section 80E

Deduction under section 80E

Deduction is allowed for repayment ofinterestcomponent of Higher Education loan. All education

after Class 12 is allowed, either vocational or Fulltime.But should be from a school/institute/universityrecognized by the government.

8 ) Section 80G

Contribution to exempt charities

25/50/75/100%depending on the charity and as per approval

100% exemption on donation to political parties


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9) 80U

Deduction under section 80U

Deduction upto Rs. 50,000/- is allowed in case of

Permanent Disability. In case of Permanent Disability exceeding 80%,

maximum deduction allowed is Rs. 75,000/-.

10) Section 24(1)(vi)

Housing loan interest.Maximum Investment Limit

Rs.1,50,000 (for loans taken after 1 April 1999, for loansbefore that Maximum Investment Limit 30,000).


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11) SuperannuationAny contribution made bya company to superannuation fund upto Rs.1,00,000 tax free in the hands of the employee

12) Conveyance/Transport Allowance

Any

Conveyance / Transport Allowance given to anemployee is tax free upto Rs. 9,600 /- (NoSupporting Bills required)

13) Medical Allowance

Any MedicalAllowance given to an employee is tax free uptoRs. 15,000 /- (Supporting Bills required)


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Punjab Chief Minister Parkash Singh Badal

sought income tax exemption for industry,corporate houses, NGO's and media investing in

the road safety programmes approved by the

government in the forthcoming Union budget

for 2012-13 financial year.


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Income Tax exemption limit for individuals has

been raised from Rs 1.6 lakh to Rs 1.8 lakh, giving

a relief of Rs 2000 to every tax payer, in the Budget

for 2011-12 which widened the Service Tax net to

cover more services that will raise the cost of airtravel, hotel accommodation and those who drink in

AC restaurants.


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Income tax benefits for projects


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Five year tax holiday for:

Power projects

Firms engaged in exports

New industries in notified states and for new industrial

units established, in electronic hardware/softwareparks.

Export oriented units and units in Free Trade Zones.

As of 1994-95 budget firms engaged in providing

infrastructure facilities, can also avail of this benefit.


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Tax deductions of 100% of export profits

Deduction of 30% of net income for 10 years for new

industrial undertakings.

Deduction of 50% on foreign exchange earnings byconstruction companies, hotels and on royalty, commission,etc.

Deduction in respect of certain inter-corporate dividends tothe extent of dividend declared.

Deduction of an additional amount of Rs.20000 allowed,over and above the existing limit of Rs. 1lakh on tax savings,for investment in long term infrastructure bonds as notifiedby the central government.


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Besides contribution to health insurance schemeswhich is currently allowed as a deduction under theIncome Tax Act, contributions to the central

government health scheme also allowed as adeduction under the same provision.

Current surcharge of 10 percent on domesticcompanies reduced to 7.5%

Rate of minimum alternate tax(MAT) increased fromthe current rate of 15% to 18% of book profits.

To further encourage R & D across all sectors ofeconomy, weighted deduction on expenditure incurredon in-house R&D enhanced from 150% to 200%.


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Weighted deduction on payments made to national

laboratories, research associations, colleges, universities and

other institutions, for scientific research enhanced from 125%to 175%.

Payment made to an approved association engaged in

research in social sciences or statistical research to be allowedas a weighted deduction of 125 %. The income such approved

research shall be exempt from tax.

Benefit of investment linked deduction under the Actextended to new hotels of 2 star category and above

anywhere in India to boost investment in the tourism sector.


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Limits for turnover which accounts need to be auditedenhanced to Rs.60 lakhs for businesses and to Rs.15 lakhsfor professions.

Limit of turnover for the purpose of presumptive taxationof small businesses enhanced to Rs.60 lakhs.

If tax has been deducted on payment by way of anyexpense and is paid before the due date of filing the return,such expenditure to be allowed for deduction. Interestcharged on tax deducted but not deposited by the specifieddate to be increased from 12% to 18% p.a.

To facilitate the conversion of small companies into limitedliability partnerships, transfer of assets as a result of suchconversion not to be subject to capital gains tax


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The advancement of any other object of general public utility to be

considered as charitable purpose even if it involves carrying on of

any activity in the nature of trade, commerce or business providedthat the receipts from such activities do not exceed Rs.10 lakhs in

the year.

Proposals on direct taxes estimated to result in a revenue loss of

Rs.26000 crores for the year.

Allow pending projects to be completed within a period of five

years instead of 4 years for claiming a deduction of their profits, as

a one time interim relief to the housing and real estate sector.

Norms for built-up areas of shops and other commercial

establishments in housing projects to be relaxed to enable basic

facilities for their residents.


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THANK YOU

Documents

Charge to Income-Tax PPT