PERSONAL INCOME TAX CALCULATION & PLANING FOR F.Y. 2018-19

Posted By on February 4, 2018

The Union Budget, 2018 has not made any major changes in the Income Tax Rates for Individuals. We are noting below the method of calculating the Income Tax on Individuals, HUF, AOP & BOI and KEY Tax Planning provisions under Income Tax Act, 1961 for the F. Y. 2018-19:-

 

SECTION 1 : TAX CALCULATION

A) Tax Calculator (General Category & Women):-

SLAB TOTAL INCOME Rate

of Tax

TAX CALCULATOR COMMENTS
I Upto Rs. 2,50,000/- 0 % NIL NO CHANGE
II Rs. 2,50,001/- to Rs. 5,00,000/- 5% (Total Income – 2,50,000)*5% NO CHANGE
III Rs. 5,00,001/- to Rs. 10,00,000/- 20 % 12500 + (T.I. – 500000)*20% NO CHANGE
IV Above Rs. 10,00,000/- 30 % 112500+(T.I.–10,00,000)*30% NO CHANGE

 B) Tax Calculator (Senior Citizen – Age 60 Years):-

SLAB TOTAL INCOME Rate

of Tax

TAX CALCULATOR COMMENTS
I Upto Rs. 3,00,000/- 0 % NIL NO CHANGE
III Rs. 3,00,001/- to Rs. 5,00,000/- 5% (Total Income – 3,00,000)*5% NO CHANGE
IV Rs. 5,00,001/- to Rs. 10,00,000/- 20 % 10000 + (T.I. – 500000)*20% NO CHANGE
V Above Rs. 10,00,000/- 30 % 110000+(T.I.–10,00,000)*30% NO CHANGE

C) Tax Calculator (Very Senior Citizen – Age 80 Years):-

SLAB TOTAL INCOME Rate

of Tax

TAX CALCULATOR COMMENTS
I Upto Rs. 5,00,000/- 0 % NIL No Change
II Rs. 5,00,001/- to Rs. 10,00,000/- 20 % (T.I. – 5,00,000)*20 % No Change
III Above Rs. 10,00,000/- 30 % 1,00,000+(T.I.–10,00,000)*30 % No Change

 

SECTION 2 : SURCHARGE & EDUCATION CESS

Surcharge – Total Income upto Rs. 50 Lakhs                 : NIL

Total Income > 50 Lakhs <= 1 Crore         : 10%

Total Income > 1 Crore                                 : 15%

Health & Education Cess – 4% of the Income Tax & Surcharge (replaced 3% Cess in preceding year)

 

SECTION 3 : KEY TAX SAVINGS PROVISIONS UNDER INCOME TAX ACT, 1961

Section Nature Deduction Upper Limit Comments
16 (ia) Standard Deduction to Salaried Employees 40000/- Existing Transport Allowance upto Rs. 19200/- & Medical 15000/- has been withdrawn.
24 (b) Interest on Housing Loan (Self Occupied) Upto Rs. 2 Lakhs

 

No Change
80 C Investments in Life Insurance Premium, PF, PPF, NSC, ULIP, Tax Benefit Mutual Funds, Tution Fees (2 Child), Home Loan Principal Repayment, Notified Bonds, 5 Yr FDs etc Upto Rs. 1.50 Lakhs No Change
80 CCD Investment in Pension Scheme Upto Rs. 0.50 Lakhs For individuals other than employee – limit of investment in NPS increased to 20% of GTI
80 D Mediclaim Insurance Sr. Citizen : Rs. 50000/-

Others : Rs. 25000/-

The Limit Increased for Senior Citizens from 30000 to 50000
80 E Interest on Education Loan

 

(Upto maximum 8 years from the year of first repayment)

Entire Interest Paid during the year Conditions:-

1.    Education Loan must be taken by that Individuals;

2.    For Higher Education of Self, Spouse, Children or student for whom, he is a legal guardian;

3.    The loan is taken from any Financial Institution or  approved Charitable Institution;

80 GG Rent Paid Lower of Following:

1.    Rs. 5000 p.m.

2.    25% of Total Income;

3.    Rent Paid – 10% of Total Income

No Change
80TTA Interest from Savings Account Rs. 10000/- This is allowed to the extent of Interest earned from Savings Account. No Benefit under this section if benefit u/s 80TTB is claimed.
80TTA Interest from Deposits in Banking Co or Post Office Rs. 50000/- Only for Senior Citizens (Age 60 years) without TDS Liability.
87A Rebate 2500/- or Tax Liability whichever is lower Applicable only for Individuals & HUF with Total Income upto 3,50,000/-

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The Views expressed on this blog are strictly personal and for knowledge of our clients only. The contents of this blog are solely for informational purpose and it does not constitute any professional advice or recommendation. The laws related to GST and other taxes are under evolution and subject to constant changes and amendments over time. It is suggested to take specific legal advice and necessary due diligence before relying on the contents and information of this Blog. The authors of this blog, does not accept any liabilities for any loss or damage of any kind arising out of information on this blog and for any actions taken in reliance thereon.