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Income Tax Ready Reckoner - Part V

 

 

Here's a ready reckoner on how to calculate your tax dues so that you can plan your investments accordingly
 

D. Available Window For Sec. 80C

  • Existing or new? The maximum deduction you can claim under Sec 80C is Rs 1 lakh. You can either increase your existing 80C commitments (C) or choose any or a combination of tax-savers listed in (D), along with new insurance plans.
  • Senior citizens savings scheme Notified term deposits in scheduled banks with a minimum period of five years under the Bank Term Deposit Scheme, 2006, in addition to giving a fixed and assured return (around 8 per cent) come with a tax advantage.
  • Post office Time deposits Current interest of 7.5 per cent p.a. on 5-year post office time deposit is fully taxable. Investment is deductible from income.
  • National Savings Certificate Six-year government-backed security available at post offices. Interest rate currently 8 per cent compounded half-yearly; fully taxable. Amount  invested is tax deductible.
  • Bank Fixed deposits Notified term deposits in a scheduled bank with a minimum period of five years under the Bank Term Deposit Scheme, 2006, in addition to giving a fixed and assured return (around 8 per cent), come with a tax advantage.  However, the interest income is fully taxable.
  • Equity-Linked Savings Scheme (ELSS) An equity-linked savings scheme is a type of mutual fund, which, like any diversified equity mutual fund, routes investments into the equity market. It stands apart from other mutual funds as it carries a tax benefit and has a three-year lock-in period

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