How to Save Tax for Salaried Individuals and Professionals for FY 2019-20?

How to Save Income Tax? - an inquiry that is frequently posed by my friends, family and blog visitors. The issue is there are various sections for individuals to know and on the off chance that they have caught wind of it to check if its relevant to their case or not? To help both salaried and experts in their tax planning, 

Budget 2019: Changes in Income Tax Rules 

• Expanded Tax Rebate u/s 87A: For people with net taxable income of Rs 5 lakh or less the tax refund would be lesser of tax obligation or Rs 12,500 whichever is lower 

• Standard derivation for Salaried individuals and Pensioners expanded from Rs 40,000 to Rs 50,000 

• Expanded Tax for super-rich: Surcharge expanded to 25% for income between 2 to 5 crore and to 37% for income past Rs 5 crores 

• Additional Tax Deduction of Rs 1.5 lakhs u/s 80EEA on home loans on purchase of reasonable home 

• Additional Tax Deduction of Rs 1.5 lakhs under section 80EEB on Auto loans on purchase of Electric vehicles 

• Zero Tax on Notional Rental Income from Second House 

• Capital gains exception on reinvestment in two house properties: Tax payers would now be able to purchase two houses at a bargain of 1 house if the capital gains are not as much as Rs 2 crore. This benefit can be profited just a single time in lifetime 

• TDS edge expanded from Rs 10,000 to Rs 40,000 on Bank Interest Income 

Section 80C/80CCC/80CCD (Save Tax by Investing) 

These 3 are the most mainstream sections for tax saving and have part of choices to save tax. The greatest exclusion joining all the above sections is Rs 1.5 lakhs. 80CCC arrangements with the pension items while 80CCD do include Central Government Employee Pension Scheme. 

You can browse the accompanying for tax saving investments: 

• Employee/Voluntary Provident Fund (EPF/VPF) 
• PPF (Public Provident fund) 
• Sukanya Samriddhi Account 
• National Saving Certificate (NSC) 
• Senior Citizen's Saving Scheme (SCSS) 
• 5 years Tax Saving Fixed Deposit in banks or post offices 
• Life Insurance Premium 
• Pension Plans from Life Insurance or Mutual Funds 
• NPS 
• Value Linked Saving Scheme (ELSS - prevalently known as Tax Saving Mutual Funds) 
• Focal Government Employee Pension Scheme 
• Head Payment on Home Loan 
• Stamp Duty and enrollment of the House 
• Tuition Fee for 2 children 

We have done an exhaustive investigation of all the above accessible choices and you can pick which is the best for you. 

Section 80CCD(1B) - Investment in NPS (National Pension Scheme) 

Budget 2015 has permitted additional exception of Rs 50,000 for investment in NPS. This is proceeded with this year as well. We have done a total investigation which you can peruse by tapping the connection beneath. 

Payment of interest on Home Loan (Section 24) 

The interest settled up to Rs 2 lakhs on home loan for self-involved or leased home is absolved u/s 24. Prior there was NO breaking point on interest allowance on leased property. Budget 2017 has changed this and now the tax exemption limit for interest paid on home loan is Rs 2 lakhs, regardless of it acting naturally involved or leased. Anyway for leased homes any misfortune in abundance of Rs 2 lakhs can be conveyed forward for as long as 7 years. 

Payment of Interest on Education Loan (Section 80E) 

The whole interest paid (with no furthest cutoff) on education loan in a money related year is qualified for allowance u/s 80E. Anyway there is no allowance on chief paid for the Education Loan. 

The loan ought to be for education of self, spouse or children just and ought to be taken for seeking after full time courses as it were. The loan must be taken fundamentally from affirmed magnanimous trust or a budgetary organization as it were. 

The derivation is relevant for the year you begin paying your interest and seven additional years following the underlying year. So in everything you can guarantee education loan allowance for greatest eight years. 

Medical insurance for Self and Parents (Section 80D) 

Premium paid for Mediclaim/Health Insurance for Self, Spouse, Children and Parents fit the bill for allowance u/s 80D. You can guarantee most extreme allowance of Rs 25,000 in case you are under 60 years old and Rs 50,000 over 60 years old. 

An additional derivation of Rs 25,000 can be guaranteed for purchasing medical coverage for your folks (Rs 50,000 in case of either guardians being senior citizens). This derivation can be guaranteed regardless of guardians being reliant on you or not. Anyway this benefit isn't accessible for purchasing medical coverage for parents in law. 

HUFs can likewise guarantee this derivation for premium paid for protecting the well-being of any individual from the HUF. 

To benefit derivation the premium ought to be paid in any mode other than money. Budget 2013 had presented derivation of Rs 5,000 (with in the Rs 25,000/30,000 cutoff) is likewise took into account preventive well-being test for Self, Spouse, subordinate Children and Parents. Its proceeded to this year as well. 

Treatment of Serious illness (Section 80DDB) 

Cost caused for treatment of certain sickness for self and wards gets derivation for Income tax. For senior citizens the allowance sum is up to Rs 1,00,000; while for all others its Rs 40,000. Ward can be guardians, spouse, children or kin. They ought to be entirely subject to you. 

To guarantee the tax exclusion you need a certificate from expert from Government Hospital as verification for the disease and the treatment. In case the costs have been repaid by the insurance organizations or your manager, this derivation can't be claimed.In case of halfway repayment, the equalization sum can be guaranteed as allowance 

Ailments Covered: 

• Neurological Diseases 
• Parkinson's Disease 
• Threatening Cancers 
• Helps 
• Persistent Renal disappointment 
• Hemophilia 
• Thalassaemia 

Truly Disabled Tax payer (Section 80U) 

Tax Payer can guarantee allowance u/s 80U in case he experiences certain handicaps or ailments. The derivation is Rs 75,000 in case of typical handicap (40% or greater incapacity) and Rs 1.25 Lakh for serious inability (80% or greater inability) 

A certificate from nervous system specialist or Civil Surgeon or Chief Medical Officer of Government Hospital would be needed as verification for the sickness. 

Disabilities Covered 

• Visual impairment (Blindness) and Vision issues 
• Infection relieved 
• Hearing weakness 
• Locomotor incapacity 
• Mental impediment or disease 
• Chemical imbalance 
• Cerebral Palsy 

Genuinely Disabled Dependent (Section 80DD) 

In case you have subordinate who is distinctively abled, you can guarantee allowance for costs on his upkeep and medical therapy up to Rs 75,000 or genuine consumption acquired, whichever is lesser. The breaking point is Rs 1.25 Lakh for serious inability conditions for example 80% or a greater amount of the incapacities. Ward can be guardians, spouse, children or kin. Likewise the ward ought not have guaranteed any allowance for self inability u/s 80DDB. 

To guarantee the tax benefit you would require inability certificate gave by state or focal government medical board. 

You can likewise guarantee tax exclusion on premiums paid for life insurance strategy (in tax payers' name) where the incapacitated individual is the recipient. In case the crippled ward lapses before the tax payer, the arrangement sum is returned back and treated as income for the year and is completely taxable. 

40% or a greater amount of following Disability is considered for purpose of tax exception 

• Visual deficiency and Vision issues 
• Sickness restored 
• Hearing impedance 
• Locomotor inability 
• Mental hindrance or sickness 
• Mental imbalance 
• Cerebral Palsy 

Donations to Charitable Institutions (Section 80G) 

The government urges us to give to Charitable Organizations by giving tax allowance to a similar u/s 80G. A few donations are absolved for 100% of the sum gave while for others its half of the gave sum. Additionally for most donations, the greatest exclusion you can guarantee is restricted to 10% of your gross yearly income. If it's not too much trouble note that solitary donations made in real money or check are qualified for allowance. Donations in kind like giving garments, food, and so forth isn't secured for tax exclusion. 

How to Claim Sec 80G Deduction? 

• A marked and stepped receipt gave by the Charitable Institution for your gift is must 
• The receipt ought to have the enrollment number gave by Income Tax Dept imprinted on it 
• Your name on the receipt must match with that on PAN Number 
• Likewise the sum gave ought to be referenced both in number and words 

Donations for Scientific Research (Section 80GGA) 

100% tax derivation is took into account gift to the accompanying for logical research u/s 80GGC 

• To a logical research affiliation or University, school or other establishment for undertaking of logical research 
• To a University, school or other organization to be utilized for research in sociology or factual research 
• To an affiliation or organization, undertaking of any program of provincial turn of events 
• To a public area organization or a nearby position or to an affiliation or foundation endorsed by the National Committee, for doing any qualified undertaking or scheme 
• To the National Urban Poverty Eradication Fund

Donations to Political Parties (Section 80GGC) 

100% tax derivation is considered gift to a political faction enlisted under section 29A of the Representation of the People Act, 1951 u/s 80GGC. 

House Rent in case HRA isn't essential for Salary (Section 80GG) 

In case, you don't get HRA (House Rent Allowance) as a salary segment, you can in any case guarantee house lease derivation u/s 80GG. Tax Payer might be either salaried/pensioner or independently employed. 

To benefit this you have to match the accompanying conditions: 

• The lease paid ought to be more than 10% of the income 
• Nobody in the family including spouse, minor children or self should claim a house in the city you are living. On the off chance that you own a house in various city, you need to think about rental income on the equivalent 

The House Rent derivation is lower of the 3 numbers: 

• Rs. 5,000 every month (changed from Rs 2,000 to Rs 5,000 in Budget 2016) 
• 25% of yearly income 
• (Lease Paid-10% of Annual Income) 

You have to fill a form no 10BA alongside the tax bring structure back

Alongside the tax saving sections and investments for both salaried and business, it likewise has insights concerning all the normal salary parts and their tax treatment. This section can assist you with planning your salary parts in case your organization offers such office.