Skip to main content

Save on tax outgo even if you missed the deadline

 

AS THE financial year is coming to an end, it's a race against time for those who wait till the last minute to do their tax planning.

Fortunately, there are ways to claim tax deductions where you are entitled to even if you have missed the deadline set by your employer for submission of relevant proof of investments or expenses.

If you are a salaried individual, you are required to submit relevant documents/proof with respect to various exemptions and deductions that you wish to claim. If you stay in a rented accommodation, you can submit rent receipts or a copy of the lease deed to claim exemption in house rent allowance.

In respect of medical and travel expenses, you can submit relevant bills up to the prescribed limit to the employer so that the allowances given to you under these heads are not considered taxable in your hands.

Medical expenses up to Rs 15,000 per annum can be claimed for exemption while in case of travel allowances, expenses for travel to any place within India is exempt twice in a block of four calendar years. The current block is from 2010 to 2013.

In case you are repaying interest on a home loan for a self-occupied property, then you are eligible to claim deduction up to Rs 1,50,000 per annum and the amount can be set off against your salary income as prescribed under the Income Tax Act.

In respect of investment for which one can claim deductions as specified under the In come Tax Act, one should ensure that the same is done before the end of the financial year, that is March 31.

Under Section 80C, an individual can claim deduction up to a maximum of Rs 1,00,000 from taxable income for investments made in specified tax-saving instruments. These include investment in public provident fund (which is limited up to Rs 70,000), national savings certificate, premium for life insurance, bank fixed deposits for tenures of more than five years, repayment of principle on a housing loan, tuition fees and tax-saving mutual fund schemes. In case of salaried individuals, the contribution towards employees provident fund is considered directly by the employer while allowing deduction under Section 80C.

There are a host of other deductions available up to prescribed limits.

These include payment of medical insurance premium up to Rs 15,000 for self as well as family under Section 80D, which can go up to Rs 20,000 if the same is taken for a senior citizen; investment up to Rs 20,000 in long-term infrastructure bonds is available for deduction under Section 80CCF; donations as prescribed under the act (Section 80G ­ 100 per cent or 50 per cent of the total amount depending on the fund to which the contribution is made), interest paid on loan for higher education under Section 80E (entire amount if prescribed conditions are fulfilled), among others.

Now, what if you are entitled to claim deductions under many of these heads but you have missed the deadline to submit your claims? Worry not; you can still claim those exemptions and deductions while filing your tax return.

This means claiming a refund while filing your tax return in case you are unable to adjust the excess tax deducted by your employer against the tax payable on other incomes, if any.

In case you have income from any other sources on which income tax has not been deducted at source, you should ensure that you pay advance tax in time to avoid paying interest at the rate of 1 per cent per month for the delay in depositing such taxes.

However, no interest will be levied for late deposit if the advance tax liability is not more than Rs 10,000.

It is also important to take stock of certificates of taxes deducted on salary (Form 16) and other income (Form 16A).

If the said certificates are not issued by the payers or have been misplaced by the individual, one may not be able to claim necessary credit for the taxes if the tax authorities raise a demand for the same at a later date.
Therefore, it is imperative for individuals to ask for original/duplicate certificates from the persons or entities that deducted such taxes.

These small yet important precautions can go a long way in ensuring that correct amount of taxes are paid with the tax authorities on a timely basis and the tax liability is minimized to the extent possible under various sections of the tax law.

 

Popular posts from this blog

SBI Magnum Tax Gain Scheme 1993 Applcation Form

    https://sites.google.com/site/mutualfundapplications/tax-saving-mutual-funds-elss     Investment Details Basics Min Investment (Rs) 500 Subsequent Investment (Rs) 500 Min Withdrawal (Rs) -- Min Balance -- Pricing Method Forward Purchase Cut-off Time (hrs) 15 Redemption Cut-off Time (hrs) 15 Redemption Time (days) -- Lock-in 1095 days Cheque Writing -- Systematic Investment Plan SIP Yes Initial Investment (Rs) -- Additional Investment (Rs) 500 No of Cheques 12 Note Monthly investment of Rs 1000 for 6 months and quarterly investment of Rs 1500 for 4 quarters.

Impact of Demonetisation

The government's move to demonetise `500 and `1,000 currency notes will immediately impact reserve money and money supply in the system along with the balance sheet of the Reserve Bank of India, the sole authority in the country for accepting currency notes and coins as legal tender. ET explains the interplay of currency, reserve money and money supply. 1. What is currency in circulation? It is the total value of currency (coins and paper currency) that has ever been issued by the central bank minus the amount that has been withdrawn by it. Currency in circulation comprises currency notes and coins with the public and cash in hand with banks. It is a major liability component of a central bank's balance sheet. 2. What is reserve money? It is essentially the central bank's money . It is also called high-powered money , base money and central bank money . As per the definition, reserve money equals currency in circulation plus bankers' deposits

Birla Sun Life Tax Plan Online

Invest Birla Sun Life Tax Plan Online   An Open-ended Equity Linked Savings Scheme (ELSS) with the objective to achieve long-term growth of capital along with income tax relief for investment.   After a bad patch from 2008 to 2010, Birla Sun Life Tax Plan has made a big comeback in the last five years, with a particularly good run since 2014. The fund's rankings, which had slipped to two stars in 2011-12, recovered sharply to three-four stars in the last three years. The fund has delivered a particularly large outperformance over its benchmark and peers in the last couple of years. The fund's investment strategy focuses on a diversified and high-quality portfolio, with parameters such as capital ratios and balance-sheet strength used to judge quality. It uses a combination of top-down and bottom-up approaches to take sector/stock positions. The fund avoids highly leveraged plays. Staying more or less fully invested at all times, the fund parks roughly half of its portfoli

Should you Roll Over 1 year Fixed Maturity Plans?

The period between January and March typically sees an uptick in the launch of fixed maturity plans, or FMPs. Not this year. Instead, fund houses are busy rolling over or extending the tenure of their one- year FMPs launched last year to three years. Investors in one- year FMPs have a choice. Either redeem units or roll over to three years. If you exit now, your gains will be added to your income and taxed in line with your individual slab rate of 10, 20 or 30 per cent. If you stay invested for two more years, you pay 20 per cent tax with indexation benefit. Yields have softened in the past few months on expectations of a rate cut. If the central bank continues its soft monetary stance, yields are likely to fall further. In such a scenario, it makes sense for investors, particularly those in the 30 per cent tax bracket, to roll over their investments and lock in at a higher yield now. In a surprise move, the Reserve Bank of India cut repo rate by 25 basis

Max Life Monthly Income Advantage Plan

Money back policies are highly expensive, they mostly don't offer adequate insurance cover and they don't offer good returns Max Life Monthly Income Advantage Plan is a traditional money back policy. Money back policies are similar to endowment insurance plans where the policy provides for partial survival benefits during the term of the policy. These type of products are expensive, they mostly fail to offer adequate insurance cover and they don't offer good returns. What the agent has told you isn't correct. In this policy, the money back is in the form of regular income after completion of 10 years. At the end of premium paying term, you will get a guaranteed monthly income for 10 years which will be 1/12th of 10 percent of the sum assured.  So for instance, if your sum assured is R 10 Lakhs, then the guaranteed monthly income will be R 8333 (100000/12). The reversionary and terminal bonuses mentioned are not guaranteed. You will pay a very high pr
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now