Tax Planning For Individuals in India
HOME SERVICES FEEDBACK CONTACT US BLOG X Deepti Arora & Co. – Chartered Accountants Tax Planning For Individuals in India 4 April 2022|employee, house rent allowance, hra, income tax, income tax return, tax Tax planning is a legal and statutory method of minimizing one’s annual tax liabilities. It will help you make the possible use of tax deductions, exemptions, and benefits to minimize your tax burden. To reduce one’s tax burden, one must engage in tax planning. The government provides various tax-saving opportunities. Legal tax planning aims to minimize a taxpayer’s tax burden. Benefits of Tax Planning for Individuals: The following are the primary benefits of tax planning: Tax preparation enables the financial planning process to run smoothly. Tax compliance minimizes legal entanglements Tax planning enables the allocation of taxable income to various investment vehicles. Effective tax planning enables you to save money. Companies can contribute to our country’s economic growth through tax planning. Contributes to economic stability Preferred Tax-Saving Strategies: To minimize your taxable income, make a Rs 1.5 lakh investment under Sec 80C. Further deductions of Rs 50,000 can also be claimed under 80CCD by contributing to NPS (1b). Section 80D permits you to a tax deduction of up to Rs. 100,000 if you get medical insurance. If you are a senior citizen, you and your family can deduct up to Rs. 50,000 from your taxes under this section. Deduct up to Rs 50,000 in interest on home loans under Section 80EE. Additional Tax Savings Options: Fifty thousand rupees for medical insurance premium. (Rs 25000 for self, spouse, and children; Rs 25000 for dependent parents under the age of 60). Medical insurance premiums for senior citizens are eligible for benefits up to Rs 1,00,000 each year. Section 24 allows a deduction for interest charged on a house loan up to Rs 2 lakhs. A home loan might also help you save on taxes because the principal amount of the loan is claimed u/s 80C up to Rs. 1.5 lakh, and also, the amount of the interest is deductible as income from housing property. Any charitable contribution to registered institutions or funds may be deductible under section 80G. Interest on educational loans is deductible under section 80E. Make A Strategy For Your Tax-Saving Investments: Tax-saving investments are best planned at the start of the financial year. Plan your tax savings for the year with these tips: Review your existing tax-saving expenses, such as insurance payments, children’s tuition fees, EPF contributions, and home loan repayment. Subtract this from Rs 1.5 lakh to calculate investment. You are not required to invest the entire amount if expenditures exceed the limit. Tax-saving investments should match your risk level. Popular options include ELSS, PPF, NPS, and fixed deposits. House Rental Allowance: Paying rent is a common way to save income tax. HRA exemption is available to individuals who reside in rented housing (Section 10 (13A) of Income Tax, 1961). You may be entitled to a tax deduction if you match the following criteria: The total amount of HRA received Rent paid lowered by 10% of basic salary 40% of the base salary for non-metro taxpayers and 50% for metro taxpayers Conclusion: It is best to pay taxes regularly. Tax-saving investments assist reduce income taxes and also create wealth over time. In addition, corporate tax planning helps manage expenses, allocate capital budgets, and reduce sales and marketing costs. Facebook-f X-twitter Contact Categories work from home tax self-employed salary slip roc rent paid rent payslip payroll deductions payroll pay slip mca kyc job change ITR india union target India income tax return income tax hra house rent allowance freelancing freelancer Form 16 finance employee compliance budget 2020 budget allowances Deepti Arora & Co. – Chartered Accountants Address 811, SIDCO ARAVALI APARTMENTS, GH-1,SECTOR 1, IMT MANESAR, GURUGRAM 122051 Contact Us +91 9999017642 +91 7827261120
Paying Rent but not getting HRA?
HOME SERVICES FEEDBACK CONTACT US BLOG X Deepti Arora & Co. – Chartered Accountants Paying Rent but not getting HRA? 10 August 2018 | allowances, employee, house rent allowance, hra, income tax, income tax return, ITR, payroll, payslip, rent, rent paid, salary slip, self-employed Are you A self-employed businessman or professional or a salaried employee? Staying in a rented accommodation and paying rent? You or your spouse don’t own a residential accommodation at the place where you reside or are working and are also paying rent? Not receiving any House Rent Allowance or HRA ? Can you still take any benefit on the rent paid? The answer is Which section allows you to claim exemption? As per the provisions of the Income Tax Act, 1961, you can still claim benefit of rent paid under section 80GG. What is the limit for exemption? The section allows an individual to claim exemption as the minimum of: – Rs. 5000 per month – 25% of Total Income – Actual Rent paid less 10% of Total Income What you need to do? Just fill Form 10BA with all the details related to payment of rent and you are good to claim the exemption. Still have any confusion/concerns? Reach out to us and we will be happy to help! Share this post: Facebook-f X-twitter Contact Categories work from home tax self-employed salary slip roc rent paid rent payslip payroll deductions payroll pay slip mca kyc job change ITR india union target India income tax return income tax hra house rent allowance freelancing freelancer Form 16 finance employee compliance budget 2020 budget allowances Deepti Arora & Co. – Chartered Accountants Address 811, SIDCO ARAVALI APARTMENTS, GH-1,SECTOR 1, IMT MANESAR, GURUGRAM 122051 Contact Us +91 9999017642 +91 7827261120
Changed job Lately?? Things to Do from income tax standpoint
HOME SERVICES FEEDBACK CONTACT US BLOG X Deepti Arora & Co. – Chartered Accountants Changed job Lately?? Things to Do from income tax standpoint 2 August 2018 | accounting, allowances, finance, Form 16, income tax, income tax return, India, ITR, job change, pay slip, payroll, payroll deductions, payslip, salary slip Switching jobs is usual. There are a lot of reasons while people change jobs. Some people change for financial gains while some change for career growth. The reasons can be plenty. Whatever is the reason, there is always an element of excitement of joining a new organization and you have new hopes and dreams with this change. To ensure that this excitement and enthusiasm continues and is not dampened by income tax issues, keep in mind the following points whenever you make a job change. 1. Make sure you always declare your income earned from previous employer to your current employer: I have come across a lot of cases where the employees changed jobs during a financial year and failed to declare the income from previous employer to the current one. The result : while filing their Income Tax Return they not only had to pay the differential tax but also had to pay interest on the tax which was not deducted by the employers. 2. Your tax slab can change when you combine the salary you have received from the different employers. 3. Provide all necessary documents to the employers so that you can claim benefit of exempted allowances, investments made, housing loan principal and interest benefit etc. 4. Don’t claim any exemptions twice: While you will submit the necessary proofs to take benefits allowable under income tax, at the same time ensure that you don’t end up taking any benefit more than once. 5. Don’t think you can hide the salary income: Your Form 26AS would reflect all the employers you have worked for and the salary they have paid to you. The same can be viewed when you logon to the income tax e-filing website: https://www.incometax.gov.in/ The income tax department too have access to this data so don’t think you can hide the salary you received during the year. My advise: next time you change a job, keep all these points in mind to ensure a smooth income tax compliance process. Still have any doubts, call us at 9999017642 Share this post: Facebook-f X-twitter Contact Deepti Arora & Co. – Chartered Accountants Address 811, SIDCO ARAVALI APARTMENTS, GH-1,SECTOR 1, IMT MANESAR, GURUGRAM 122051 Contact Us +91 9999017642 +91 7827261120