The Income Tax Act provides the assesses provision for deduction and rebates on tax liability. These rebates allow for deduction from the tax imposed on the income of an individual. Some of the provisions that allow for exemption of Income tax include the following:
Section 80C: Investment in specified instruments and expenses
Section 80C grants the tax payers up-to a maximum of Rs. 1,00,000 tax free income in a year, if they invest in the following instruments.
Premium for Life Insurance or ULIP.
Public Provident Fund (PPF) - only up to Rs. 70,000 in a year.
Provident Fund (PF) contribution.
Infrastructure bonds.
Repayment of home loan principal.
Equity Linked Savings Schemes (ELSS) of Mutual Fund Companies.
National Savings Certificates (NSC).
Tax Saving Fixed Deposits with Banks.
Tuition Fees of children.
U/s 88B: Rebate to senior Citizen
This provision of tax rebate is granted to resident individuals, who are above 65 years of age.
Under this section a rebate of Rs 15,000. on income tax liability is allowed, irrespective of the income earned.
U/s 88C: Rebate For Women Assesses
Under this section rebate is granted to resident women assesses, who are below 65 years.
The provision allows for deduction of Rs. 5,000 allowed to any tax liability of women.
Deductions from Gross Total Income
Gross total income means the income earned in a particular financial year under different heads. Under this section, exemption are allowed under various section with reference to chapter VI-A of Income tax act. To claim income tax exemptions, certain conditions have to be fulfilled.
80CCC - Investment in Pension Fund of LIC.
80D - Medical Insurance.
80DD - Maintenance including medical treatment of handicapped dependent.
80DDB - Medical treatments.
80-E - Repayment of loan lent for higher education.
80G - Donations to charitable trusts or institutions.
80GG - Rent Paid by an Assesses for furnished or unfurnished accommodation.
80GGA - Donations for scientific research / rural or urban development.
80-HH - Deduction on profits and gains from newly established industrial undertakings or hotel in backward areas.
80-HHA - Deduction in respect of profits earned from newly established small scale industrial undertakings in certain areas.
80-HHB - Deduction in respect of profits earned from projects outside India.
80-HHBA - Deduction in respect of profits earned from housing projects in certain areas.
80-HHC - Deduction in respect of profits earned from export of goods.
80-HHD - Deduction in respect of gains from foreign exchange
80-HHE - Deduction in respect of profit from export of computer software, etc.
80-HHF - Deduction in respect of profit earned from export or transfer of film software, etc.
80-IA - Deduction in respect of profit made from certain industrial undertakings or enterprises, etc.
80-IB - Deduction in respect of profit and gains of certain industrial undertakings excluding infrastructure development undertakings, etc.
80-JJA - Profits made from business of collecting and processing biodegradable wastes.
80-JJAA - Deduction in respect of employment of a new worker.
80-L - Interest on dividends, securities, etc.
80 O - Royalties, commissions, fees for professional services earned in convertible foreign exchange
80-P - Certain fixed income of Co-operative Societies
80-R, 80-RR and 80-RRA - Income from foreign sources.
80-U - Income of disabled / handicapped Assesses.
The analysis for filing income tax returns should be made considering the tax slab or bracket under which the income of an individual falls, and deduction on income to which he is liable.
