Automated All in One Income Tax Preparation Excel Based Software for Govt and Non-Govt employees for F.Y.2016-17, With Major Tax Deduction Sections for F.Y.2016-17

Download Automated All in One Income Tax Preparation Excel Based Software for Govt & Non-Govt Employees for F.Y.2016-17 [ This Excel Utility can prepare at a time your Tax Compute Sheet + Individual Salary Sheet + Inbuilt the Salary Structure for Govt & Non-Govt Salary Pattern + Automatic H.R.A. Exemption calculation + Automatic Arrears Relief Calculation with Form 10E + Automated Form 16 Part A&B and Part B for F.Y.2016-17

It's that time of the year again when people start planning their taxes. Most delay this till the last moment and then invest without giving serious thought to the tax-saving instruments at hand. That's why we thought we should warm you up well in advance so that you can make the best use of all the options.

MAKING RS 1.5-LAKH LIMIT COUNT U/s 80C

You can claim a deduction of up to Rs 1 lakh under Sections 80C, 80CCC, and 80CCD. If you are in the 30% tax bracket, you can save up to Rs 30,900 by investing in the following approved tax-saving instruments.

Additional deduction will be claim U/s 80CCD(2) Employer Contribution to the Employee’s Pension Fund @ 10% And another Section 80 CCD(1B) Max Rs. 50,000/- OUT OF THE LIMIT OF U/S 80C

     ·                               Employee Provident Fund (EPF):

You must contribute at least 12% of your salary-basic pay, dearness allowance (including the cash value of any food concession) and retention allowance-towards EPF. This is deductible under Section 80C Or Max Rs. 1.5 lakh

Premature withdrawal is allowed only under conditions specified by the government. If the amount is withdrawn before five years of subscription to the scheme, the tax benefits that have been availed of it are canceled.

     ·                               Public Provident Fund (PPF):

Any resident Indian can invest in PPF and claim income tax deduction. An individual can also contribute on behalf of a Hindu Undivided Family. One can also invest in the name of spouse and children. However, the tax deduction is available only on contributions up to Rs 1.5 lakh.

    ·                               National Savings Certificate (NSC):

You can invest in five- and 10-year NSCs. Five-year NSCs are offering 8.5% a year while 10-year NSCs are paying 8.8%. The interest earned is taxed. There is no restriction on the amount that can be invested, though tax deduction can be claimed only up to Rs 1.5 lakh.

    ·                               Bank, post-office Fixed deposits:

Investment in five-year bank and post-office fixed deposits is eligible for tax deduction. The interest earned is taxable, Max limits Rs. 1.5 Lakh

   ·                               Life insurance schemes:

Investment in a life insurance scheme (unit-linked, traditional endowment or term plan) with sum assured at least 10 times the annual premium is eligible for tax deduction within the Rs 1.5 lakh limit. Returns from these schemes are not taxed. The minimum policy term is five years. Premiums paid for annuity plans of life insurers are also tax deductible.

    ·                               Tax saving mutual funds:

These are equity mutual fund schemes with a lock-in of three years. Investment in these funds is tax deductible up to Rs 1.5 lakh. One can continue to remain invested even after the lock-in period. Capital gains and dividends are not taxed.

    ·                               Home loan principal repayment:

The principal component of a home loan repayment is tax deductible up to Rs 1.5 lakh. However, if the property is sold before five years of the purchase, the amount claimed as a deduction is taxed in the year the house is sold.

    ·                               Children's tuition fee:

Tuition fee for educational institutes in India for full-time education of two persons is also eligible for the deduction, Max limits Rs. 1.5 Lakh

By now you must have realised that the Rs 1.5 lakh limit is too small. That is why you need to look at options under Sections 80C, 80CCC and 80CCD as well.

    ·                               Rajiv Gandhi Equity Savings Scheme:

Under this, first-time equity investors can invest up to Rs 50,000 in approved stocks and mutual funds and claim the tax deduction on 50% of the amount, or Rs 25,000, under Section 80 CCG of the Income Tax Act. But to claim this exemption, their income should not be more than Rs 12 lakh a year. They should also have a Demat account. They can avail of the tax benefit under the scheme for three years.

    ·                               Health insurance premium:

One can claim a deduction for health insurance premium paid for self, spouse, children and parents under Section 80D. The limit is Rs 30,000 for senior citizens and Rs 25,000 for others.

    ·                               Interest paid on education loan:

Interest paid on an education loan to finance higher education of self, spouse, children or a person of which the individual is a legal guardian is deductible under Section 80E. Loans taken to fund any regular or vocational course are also eligible under this Section. The deduction is available for eight years or till the interest is paid in full, whichever is lower.

    ·                               Interest repayment on the home loan:

The interest paid on a loan taken to buy a house for the living is deductible up to Rs 2 lakh a year. If the loan is for a property where the person does not live, the total interest paid is tax deductible.

However, no tax deduction is available on under-construction properties. Tax benefits can be claimed for five years after the completion of the project.

    ·                               Deduction on house rent:

Your salary has a component called Housing Rent Allowance (HRA). This is exempt from tax if you live in a rented house. 

The exemption is least of the following: 
1) actual HRA received from your employer, 
2) actual house rent paid by you minus 10% of basic salary, or 
3) 50% of basic salary if you live in a metro city or 40% of basic salary if you live in a non-metro city.

If you not received any House Rent from your employer, you can still claim the deduction on the rent paid. The deduction is the least of the following: (a) rent paid less 10% of taxable income, (b) 25% of the taxable income or, (c) Rs 5,000 a month or 60,000/- P.A.