TDS with PAN for the Financial year 2016-17 A.Y 2017-18

TDS with PAN for the Financial year 2016-17 A.Y 2017-18


TDS Payment on salary & wages

TDS is deducted only if the estimated income of the employee is taxable. Emloyer must not
deduct tax on non taxable allowance like conveyance allowance, rent allowances, medical
allowance and deductible investiments under section like 80C, 80CC, 80D, 80DD, 80DDB, 80E
, 80GG & 80U. No tax is requaired to be deducted at source if the estimated total income of the
employee is less then the minimum taxable income as per slab rate.

TDS Calculation


Gross salary Package
(-) Allowances u/s 10
(-) Deduction u/s 80
--------------------------
Estimated Taxable salary
-------------------------
Tax (as per slab rate)
add : 3% cess

-------------------------
Estimated Taxable Payable
-------------------------
Divided By 12 Months
= TDS Payable per month on salary

For Example, if your salary Package is Rs. 500000/-
Per annum which include Rs. 60000/- as allowance u/s 10 (such as medical, Travel allowance etc.
PLUS you have made Rs. 50000/- investiment which are eligible for deduction u/s 80C to 80U

Tax Payable by you is rs. 12360/- and tds payable is 1030 P.M
calculated as under :
Gross salary Package    = 500000
(-) Allowances u/s 10   = 60000
(-) Deduction u/s 80    = 50000
---------------------------------------
Estimated Taxable salary = 390000
---------------------------------------
(-) Tax (as per Slab rate = 14000

(-) Rabate u/s 87A = 2000
Add : 3% Cess = 360/-
=========================
Estimated Taxable Payable = 12360/-
=========================

Divided by 12 Months
= Rs. 1030/- TDS Payable per month

========================
TDS UNDER SECTION 192A

========================


Under this section TDS is Payable on premature withdrawal from EPF

Exemption Amount = Rs. 50000/-
TDS on individual / HUF = 10%
TDS on Others = 10%

****IMPORTANT ****

* TDS WILL BE DEDUCTED @10% IF PAN NUMBER SUBMMITED
IN CASE FORM NO 15G OR 15 H IS SUBMMITED BY THE MEMBER THEN
NO TDS SHALL BE DEDUCTED

========================

TDS UNDER SECTION 193

========================


Under this section TDS is Payable on interest received on debentures

Exemption Amount = Rs. 10000/-
TDS on individual / HUF = 10%
TDS on Others = 10%


========================

TDS UNDER SECTION 194A

========================

 Under this section TDS is Payable on interest other then Securities

Exemption = Rs. 10000/- in case of Bank interest and Rs. 5000/- in case of others
TDS on individual / HUF = 10%
TDS on Others = 10%

========================

TDS UNDER SECTION 194B
========================

Under this section Tds us payable on winning from LOTTERIES

Exemption = Rs. 10000/-
TDS on individual / HUF = 30%
TDS on Others = 30%

========================


TDS UNDER SECTION 194BB

========================

Under this section Tds us payable on winning from Horse Races

Exemption = Rs. 10000/-
TDS on individual / HUF = 30%
TDS on Others = 30%

========================

TDS UNDER SECTION 194C

========================


Under this Section TDS is Payable on Payment to Contractor or Sub Contractor.

Exemption = Rs. 30000/-(Single Transection) Per Contract or
Rs. 100000/- per Annum (More Then One Transection)

TDS on individual / HUF = 1%
TDS on Others = 2%

========================

TDS UNDER SECTION 194D

========================


Under this Section TDS is payable on insurance Commission

Exemption = Rs. 15000/-

TDS on individual / HUF = 5/-
TDS on Others = 5%

========================

TDS UNDER SECTION 194DA

========================


Under this Section TDS is payable on Payments made to LIFT INSURANCE POLICY

Exemption = Rs. 100000/-

TDS = 1%


========================

TDS UNDER SECTION 194EE

========================


Under this Section TDS is payable on Payment for National Saving Scheme

Exemption = Rs. 2500/-

TDS on individual / HUF = 10/-
TDS on Others = NA

========================

TDS UNDER SECTION 194F

========================


Under this Section TDS is payable on Commission payable Repurchase of Units

Exemption = Rs. 1500/-
TDS on individual / HUF = 20/-
TDS on Others = 20%

========================

TDS UNDER SECTION 194G

========================


Under this Section TDS is payable on Commission payable on sale of Lottery

Exemption = Rs. 15000/-
TDS on individual / HUF = 5%
TDS on Others = 5%


========================

TDS UNDER SECTION 194H

========================


Under this Section TDS is payable on Commission/Brokerage

Exemption = Rs. 15000/-
TDS on individual / HUF = 5/-
TDS on Others = 5%

========================

TDS UNDER SECTION 194I

========================


Under this Section TDS is payable on Rent of Land & Building

Exemption = Rs. 180000/-
TDS on individual / HUF = 10/-
TDS on Others = 10%


========================

TDS UNDER SECTION 194I

========================


Under this Section TDS is payable on Rent of Rent of Machinery

Exemption = Rs. 180000/-
TDS on individual / HUF = 2/-
TDS on Others = 2%

========================

TDS UNDER SECTION 194IA

========================


Under this Section TDS is payable on Transfer of Immovable Property

Exemption = Rs. 5000000/-
TDS on individual / HUF = 1/-
TDS on Others = 1%


========================

TDS UNDER SECTION 194J

========================


Under this Section TDS is payable on Commission or Remuneration paid to Director/ Professional Fees
Exemption = Rs. 30000/-
TDS on individual / HUF = 10/-
TDS on Others = 10%

========================

TDS UNDER SECTION 194LB

========================


Under this Section TDS is payable on interest from infrastructure Debt Fund

TDS on individual / HUF = 5/-
TDS on Others = 5%

========================

TDS UNDER SECTION 194LC

========================


Under this Section TDS is payable on interest from specified indian Company

TDS on individual / HUF = 5/-
TDS on Others = 5%

========================

TDS UNDER SECTION 195

========================


Under this Section TDS is payable on LTCG (Long term Capital Gain) to non Resident

TDS on individual / HUF = 20/-
TDS on Others = 20%

========================

TDS UNDER SECTION 195

========================


Under this Section TDS is payable on Rent to Non Resident

TDS on individual / HUF = 30%
TDS on Others = 30%

========================

TDS UNDER SECTION 195

========================


Under this Section TDS is payable on Royality to Non Resident

TDS on individual / HUF = 50%
TDS on Others = 50%

========================

TDS UNDER SECTION 195

========================


Under this Section TDS is payable on winning from Lottery / Horse Race to Non Resident

TDS on individual / HUF = 30%
TDS on Others = 30%

INCOME TAX SLAB FOR INDIVIDUAL , WOMAN & SENIOR CITIZEN FINANCIAL YEAR 2015-16

INCOME TAX SLAB FOR INDIVIDUAL , WOMAN & SENIOR CITIZEN FOR ASSESSMENT YEAR 2016-17 FINANCIAL YEAR

* Financial year 2015-16
* Assessment year 2016-17


1) Male/ Female (Individual)

 Zero   to 250000         =  Nil

 250001 to 500000        =  10%

 500001 to 1000000      =  20%

 1000001 - Above         =  30%



2) Senior Citizens Below (Above 60 age)

Zero  to 300000     =  Nil

300001 to 500000   =  10%

500001 to 1000000  =  20%

1000001 - Above    =  30%

3) Super Senior Citizen (Above 80 age)

 Zero   to 500000        =  Nil

 500001 to 1000000   =  20%

 1000001to  Above    =  30%


In addition to above TAX, there is an additional levy of 2% Education Cess and 1% Secondary and Higher Education Cess.


PLEASE NOTE : If income is above Rs. 1,00,00,000 then Surcharge of 10% will be charged on calculated Income Tax

INCOME FROM OTHER SOURCES

INCOME FROM OTHER SOURCES
==========================
are stated as under:

1) Income from sub-letting of House Property
2) Director's sitting fees
3) Agricultural income from foreign land
4) Family pension received by family members of a deceased employee
5) Rental income from vacant land
6) Remuneration received from aby person, not being employer.
7) Interest on bank or post office deposits and loans including interest from compulsory deposit.
8) Insurance commission
9) Salaries payable to the members of parliament
10) Income from private tuition received by an individual not engaged in the profession.
11) Income from undisclosed sources.
12) Interest on income tax refund.
13) Interest on tax free securities
14) Mining rent & royalties.
15) Annuity payable under a will
16) Casual Income
17) Interest on securities issued by foreign government
18) Alimony for seperate maintenance, in a divorse settlement
19) Divident from co-operative societies.
20) Directors commision for underwriting shares of the company or for standing as a guarantor.

However,
DEDUCTION ALLOWED (Section 57)
============================
are as under

1.Any reasonable sum paid by way of commission or remuneration to a banker or any other person for the purpose of realizing dividends or any interest on securities on behalf of the assessee.

2.Interest on money borrowed for investment in securities.

3.In the case of income from letting of plant, machinery or furniture, together with building which is chargeable under this head the following deduction shall be allowed.

-Depreciation on plant, machinery, furniture and building

-Insurance premium paid for the above

-Expenditure incurred for current repairs, if the building is owned by the assessee.

-Expenditure incurred for both current as well as capital repairs, if the assessee does not own the building.


Increase of family pension, deduction allowed is one third of such income or Rs. 15000 whichever is less.





Rebate 87


Rebate under section 87(A) has been started from (A.Y. 2014-2015)

Rebate is applicable to you only if your Net Taxable Income is below Rs. 500,000

However Rebate is restricted to Rs. 2,000


Calculation of Rebate:
==================

Gross Total Income = 550,000
(-)Deduction 80C - 80U = 100,000
==================
Net Taxable Income = 450,000
Tax Payable = 25,000
Less Rebate = 2,000
Tax payable = 23,000
3% Cess & Excess = 690
=================
Final Tax = 23,690

Income Form House Property

Income From House Property


House Property is classified under three major Heads:

A) Self Occupied Property
B) Letout Property
C) Deemed Letout Property

A) Self Occupied Property (SOP)
======================
The annual value of one self-occupied house property, which has not been let out for RENT at any time during the previous year, is taken as 'NIL' [Section 23 (2) (a) ].

From the annual value, only the interest on borrowed capital is allowed as deduction under section 24. Maximum Rs. 2,00,000 i.e. Interest paid on Housing Loan is Allowed.

***********************PLEASE NOTE ******************************

If interest on Housing Loan is Rs. 2,10,000 then only Rs. 2,00,000 will be allowed under SOP however Rs. 10,000 will also be allowed as DEDUCTION under Section 80EE if
1) should be First House Property Purchased
2)HP Agreement value less than 40 Lac
3)Housing Loan less than 25 lac.
4)Housing Loan Interest Paid exceeds Rs. 2,00,000.

B) Letout Property (LOP)
====================
The Gross annual value of Letout house property, which has been letout for RENT at any time during the previous year, is taken as 'highest of the following four options'
1. Actual Rent Received
2. Municipal Value of Property
3.Fair Rental Value
4. Standard Rent as per Rent control Act.

From the Gross Annual value,Municipal Tax Paid along with 30% of NAV and interest on Housing Loan is allowed as deduction without limit of Maximum interest paid.

C) Deemed Letout Property:
=======================
Is an Property other than SOP, which is ready for letout but kept idle or Locked or unused or used without rent for entire year.

PLEASE NOTE that calculation for Deemed Letout Property and Letout Property would be same.


CALCULATION
=============

Suppose Mr. A has two house property one which is SOP, on which Mr. A pays housing loan interest of Rs. 50,000 and Muncipal tax of Rs. 1,500 every
year and

his second house property is letout on rent of Rs. 100,000 per year on which Municipal tax of Rs. 2,000 and Housing Loan interest of Rs. 60,000 paid.

(i) Property No. 1 (calculation)

SOP Anuual value = NIL
(-)interest Paid = 50,000
====================
SOP Loss = (50,000)

(ii) Property No. 2 (calculation)

Gross Annual Value = 100,000
(-)Muncipal Tax = 2,000
======================
Net Annual Value (NAV) = (98,000)

Less:Deduction under Section 24
    30% of NAV = 29,400
     interest = 60,000
=====================
Letout HP Gain = 8,600

Thus TAx Payable by Mr. A on his both house property is Nil since,
SOP Loss (Property no.1) = (50,000)
HP Gain (Property no.2) = 8,600
Difference = 41,400 loss


***********************PLEASE NOTE ******************************
DEDUCTION under section 80C is also available for principal amount of loan repaid by you, if Housing loan repayment statement received from Bank states actual amount of interest and Principal repaid by you.


====================
Residential House:
====================

'A' residential house is 'One' residential house

Two of the Karnataka High Court Judgements have been nullified by this amendment. In case of sale of residential property or any other long term capital asset (other than a residential property) which result in capital gains, then such gains will be tax exempt if it is reinvest within specified time in another residential property.

Much disputes arose whether such capital gains have to be reinvested in one residential property or could be inested in more than one residential property. Two relatively recent Karnataka High Court Judgements held that there is no restriction to reinvest in just one residential house and it could be invested in more than one as the article 'a' used in sections 54 and 54F does not denote a numerical value. Further, the SLP filed by the tax department was also dismissed by the supreme court thereby making the Karnataka High Court Judgements law of Land.

Now this benefit has been taken away clarifying that the reinvestment has to be in just one residential property and not more than one. The capital gains tax exemption will be limited to only one residential property. if two or more house properties are procured or constructed then the one with maximum value should be claimed as tax exemption.

Salary, Deductions From salary & Allowance

Salary 

Salary is the remuneration received by or accruing to an individual,periodically,
for service rendered as a result of an express or implied contract. The actual
receipt of salary in the previous year is not material as far as its tax ability is concerned.
The existence of employer-employee relationship is sine-qua-non for taxing a particular
receipt under the head 'salaries'. Accordingly:

A. The Pension received by an assesses from his former employer is taxable is 'Salaries'
 whereas pension received on death of an employee by members of his/her family as Family
pension is taxed as 'Income from other Sources'.

B.The Salary received by a partner from his partnership firm carrying on a business is not chargeable
as 'Salaries' but as 'Profit & Gains from Business &
Profession'.


================
Salaries includes:
================
Wages
Annuity or Pension
Gratuity
Fees,commission,perquisites or profits in lieu of salary
Advance of Salary
Receipt from provident Fund
Contribution of employer to a Recognized Provident Fund in excess of the prescribed limit
Leave Encashment
Compensation as a result of variation in Service contract etc.

================
Deductions From Salary:
================
The income chargeable under the head Salaries shall be computed after making the following deductions:

1. A deduction in respect of any allowance in the nature of an entertainment allowance specifically
granted by an employer to the assesses who is in receipt of salary from the Government, a sum equal to
one-fifth of his salary (exclusive of any allowance,benefit or other perquisite)or five thousand
rupees, whichever is less;

2. A deduction of any sum paid by the assesse on account of a tax on employment within the meaning of
clause (2) of article 276 of the Constitution, enviable by or under any Law.

There are many options are available to save TAXES however, SALARIED peoples pays huge taxes
due to lack of awareness of about different types of incentives, allowances and rebates available to save
TAX under the Income Tax Act. However, Apart from section 80C deductions there re various other sections
 which can help salaried individual to save taxes are as under:


=================
A. Salary Restructuring:
=================
To save TAX on your SALARY, you should first know your salary structure.

HR Department of various organizations creates employees salary structure in such a way
that will attract minimum TAX hence, your salary structure will be as follows:

1.Basic Salary:
================
Fully Taxable, thus basic salary should be minimum.

2.Dearence Allowances (DA):
=====================
Fully Taxable,thus DA should be minimum

3.Tiffin/Food coupons:
===================
SODEX coupon or Ticket Restaurant coupon are given by companies to their employees as part
of their salary which are 100% exempted from TAX.

4.Allowances:
============
Allowances such as medical allowance, transport allowance, conveyance allowance, education allowance,
 uniform allowances and telephone expenses could be structured as your part of salary.
You can provide bills of actual expenses incurred for these allowances to reduce tax.

a)Medical allowance is exempted to Rs.15000/- or actual medical bills whichever is less.

b) Travel allowance (from your residence to office) upto Rs 800/- per month is exempted however Rs.1600/-.
    is exempted to handicapped or orthographically assessee.

c) Conveyance allowance (from office to office) is 100% exempted from tax irrespective to the amount received.

d)Education allowance is exempt to the extend of Rs.100 per month per child for maximum of 2 Children
  (grand children are not considered).

e)Hostel allowance is exempt to the exempt of Rs.300 per month per child for maximum of 2 children.

f) Feild areas allowance is exempted to Rs. 1,300/- per month.
g) Underground allowance (coal mine worker etc.) of Rs. 800/- per month


5. HRA:
=======
if HRA forms part of your salary, then the minimum of the following three will be exempted:
1.Actual HRA Received
2.(50% for Metro city) or 40% of Basic + DA Excess of Rent paid above 10% of Basics +DA


================
B.SECTION 80C:
================
Section 80C offers maximum deduction of Rs.1,50,000/-

DEDUCTION is available to:
=======================

1)An Individuals and
2)Hindu Undivided Family


INVESTMENT/PAYMENTS ELIGIBLE FOR DEDUCTION are as under:

1. Life Insurance Premium:
=======================
Life Insurance Premium paid for insuring life of Individual,his spouse(either husband or wife)
and children. In case of HUF premium paid for insuring life of member of HUF. However,
Amount of premium paid cannot exceed 20% of Capital sum assured.

2. Public Provident Fund:
======================
Public Provident Fund also Known as Recognised Provident Fund. In Case of which only Employee
contribution is eligible for deduction and not the amount contributed by employer.

3.Post Office Cumulative Time deposits:
=================================
Deposits in 10 years and 15 years account under Post Office Saving Bank (CTD) Rules 1959.

4.National Savings Scheme:
======================
Amount invested in NSS.

5.National Saving Certificate:
========================
Amount invested in NSS VIII issue is eligible for deduction in the year of investment.
Interest accrued on such NSS can be claimed as deduction since it is invested for the first 4 years
(form current Previous Year). 5th year interest cannot claimed as deduction because it will not be
reinvested. NSC interest for Ist four year will be taxable as other source income.

6. United Linked Insurance Plan (ULIP):
=========================
contribution make by as Individual in respect of the unit-linked insurance plan of Unit Trust of India

7.Dhanaraksha:
=============
contribition by Individual or HUF in Respect of Unit Linked Insurance Plan of LIC of India.

8.Jeevan Dhara/Jeevan Akshay:
=========================
Contribution towards Jeevan Dhara and Jeevan Akshay plans Launched by LIC of India.

National Housing Bank Loan:
========================
Any sum paid as  subscription to Home loan Account Scheme of the National Housing Bank.

10.New House:
============
Payment made towards cost of Purchase or construction of New Residential House Property.
Repayment of the Amount borrowed (Loan) from Government. Nationalised or Private Bank,LIC,NHB etc.
is eligible for deduction. Stamp Duty, Registration Fee or other expenses for the purpose of transfer
of such house property to the assessee.

Following Deduction Allowed:
=========================
An Admission fees, Cost of Shares and initial deposits etc. paid by member of co-operative society
for become a member of society. The cost of any addition,alteration,renovation or repair of the House property
carried out after completion of House property.

11. Tuition Fees:
=============
Tuition Fees paid by an individual are only eligible for deduction. It does not include development fees or donation.
 It is paid to a university,school or other educational institution situated in India.
Tuition fees paid for any two children of the tax payer will be eligible.

12.Bank Fixed Deposit:
===================
Term deposit for 5 Years or more with a Schedule Bank in accordance with prescribed scheme by an individual or HUF.

13.NABARD Bonds:
===============
Amount invested in notified bonds of NABARD.

14.Infrastructure Bonds:
====================
Amount Invested in Debentures,Equity Shares  or units of a public company engaged in infrastructure or power or
telecommunication sector.

******************PLEASE NOTE*************

AMOUNT OF DEDUCTION would be:

Amount invested of payment made would be allowed s deduction u/s 80C is equal to 100% of the qualifying amount or Rs.1,50,000
whichever is less. However , the maximum amount deductible under section 80C, 80CCC, 80CCD cannot exceed Rs. 1,50,000
as laid down under section 80CCE. In view of the same, consequential amendments are proposed
in sections 80CCE and 80CCD of the Act. w.e.f. 1st April,2015

Extension of tax benefits under section 80CCD to private sector employees.
 it is proposed to amend the provision of section 80CCD to provide that the condition of the date of joining the service
on or after 1.1.2004 is not applicable to them for the purposed of deduction under the said section. w.e.f. 1 st April, 2015.

*****************PLEASE NOTE*********************

WHEN DEDUCTION IS DISALLOWED OR WITHDRAWN

The deduction will be disallowed or withdrawn in following Cases:

1.If a ULIP (united linked insurance plan Dhanraksha ) is terminated before five years

2.If Insurance Policy is discontinued before premium for 2 years has been paid or a single premium policy is surrendered
  within two years from the date of its commencement.

3.If assessee transfers a house property before the expiry of 5 years from the date of possession of house property.

4.If assessee transfers infrastructural debentures/shares/units before the expiry of 3 years from the date of their acquisition.


==================
C.OTHER SECTIONS:
==================
a) Section 80D -Deduction of Rs. 15,000 for medical insurance of self,spouse and dependent children and
    Rs.20,000 for medical insurance of parents above 65 years.

b)Section 80G - Donations to specified funds or charitable institutions.


========================
D. House Rent Allowance:
========================
If you are paying rent but not receiving any HRA from your company still you can claim HRA under section 80GG
which is the lowest of the following three options stated under:
1. 25% of Basics + DA
2. Rs.2,000/- per month
3. Excess of rent paid above 10% Basics + DA.

**********PLEASE NOTE***************

This deduction will not be allowed, if you or your spouse or minor child owns a residential accommodation
 in the location where you reside or perform office duties.

Computation of Income

Computation of Income

Computation of Income Tax
========================

1) Salary Income
2)House Property Income
3)Capital Gain
4)Income From Other Source
5)Business/Profession Income
====================
Gross Total Income
====================

Less Deduction:
Under Chapter VI A (80C to 80U)
====================
Taxable Income
====================

Calculate Tax on Above at the rate stated below:


A. Male/Female (individual)
====================
Zero to 2.5 lac = Nil
2.5 lac to 5 lac = 10%
5 lac to 10 lac = 20%
10 lac - above = 30%

B. Senior Citizen (above 60 age)
========================
Zero to 2.5 lac = Nil
2.5 lac to 5 lac = 10%
5 lac to 10 lac = 20%
10 lac - above = 30%

C. Super Senior Citizen (above 80 age)
============================
Zero to 5 lac = Nil
5 lac to10 lac = 10%
10 lac - above =20%

In addition to above TAX, there is an additional levy of 2% Education cess and
1% Secondary and Higher Secondary Education Cess.

INTEREST PANALTY OF INCOME TAX

INTEREST PANALTY

Interest panalty is charged Under Section
234 A
234 B
234 C

A) Panalty interest U/s 234 A is attached when you fail to file  your income tax Return (ITR)
on Due Date

B) Penalty interest u/s 234 B is attached when you fail to pay 90% of advance tax installment on or
before 15th March as stated below :

Due Date                        Tax Ratio
15th September                   30%
15th December                   30%
15th March                          30%

C) Penalty Interest U/s 234 C is attacted when advance tax paid by is less then actual
advance tax payable

======================================

INTEREST PANALTY  234 A

=====================================

Calculation of interest

A) Section 234 A
Under this section 1% interest is charged per month on your tax Liability. when you fail to file
your return on or before due date i.e.

31st July or
30th September
whichever applicable

For Example Mr.A an individual is liable to pay Rs. 8000/- Tax and also to file his ITR on or
before 31st July but Mr A files his return on 10th September , here Mr. A is liable to pay Rs. 160 as
penalty interest which is 1% per of his tax liability calculated as under :

= Tax X 1% X months
8000 x 1% X 2 Total Months
= Rs. 160 Interest U/s 234 A

*********PLEASE NOTE*********

1) In the above case the delay in filing ITR is only one month and ten days only still while
calculating interest we have to consider two months.

Even if ITR delay is only ten days still interest will be calculated on entire one month and not ten days.

2) if your tax liability is ZERO then section 234 A/B/C is not applicable