LIC Premium: Premium paid by an employee to keep life insurance policy in force. Contribution to Public Provident Fund: Any amount contributed by an employee towards his (including spouse or children) Public Provident Fund account qualifies as deduction under Section 80C (subject to an overall limit of Rs 150,000).Ħ. The contribution amount is allowed as a deduction under section 80C (subject to an overall limit of Rs 150,000).ĥ.
Employee Contribution to Provident Fund: The portion which is withheld from employee’s salary on a month on month basis and contributed to provident fund. Further, in case income from house property is a loss, the same can be adjusted against income from salary to an extent of Rs 200,000.Ĥ. Such interest is allowed as a deduction while computing income from house property.
Interest on Loan: Interest paid on loan taken for acquisition and/or construction of house property. Municipal Taxes: Any taxes paid to the municipal authorities are allowed as a deduction.ī. However, the additional deduction can only be availed if the overall limit of Rs 1,50,000/- specified under section 80CCE is exhausted.Ī. The employee is eligible to claim his contribution as deduction under section 80C and is also eligible to an additional deduction under section 80CCD(1B) amounting to Rs 50,000/. However, the employee is eligible to claim deduction of the employer contribution under section 80CCD (2) to an extent of 10% of the salary. The employer contribution is added to the salary income of the employee. The NPS Corporate model allows employers and employees to contribute a certain portion of employee’s salary to NPS. National Pension System: NPS is a defined contribution based pension scheme regulated by Pension Fund Regulatory and Development Authority (PFRDA). The quantum of expenditure allowed is subject to conditions specified under tax laws.Ĭ. Exemption is available twice in a block of 4 calendar years. Leave Travel Assistance: LTA is an allowance provided by an employer to an employee for expenses incurred on travel within the country but does not include expenses incurred on boarding lodging etc. HRA is exempt subject to conditions and limits specified in the tax laws.ī. HRA: House Rent Allowance is an allowance provided by an employer to an employee to cover the house rent expenditure. Assessment Year: This means a period of 12 months (April to March) immediately succeeding the year of which income is being taxed/ assessed.Ī. Income tax slabs and rates do not differ for women taxpayers. The basic exemption limit varies from taxpayer to taxpayer basis the age of the taxpayer. Individual taxpayers enjoy a basic exemption limit, wherein income upto such limit is not taxed. The Total Income derived as above after deductions and exemptions is subject to tax as per the income tax slabs. Income Tax Slabs and Rates in India for 2021-22: Old regime
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Standard deduction of Rs 50,000 and professional tax Interest paid on self-occupied house property loan Section 80C deduction of Rs 150,000 for investment in LIC, PPF or Public Provident Fund, ELSS, EPF or Employee Provident Fund, principal repayment of home loan, etc Section 80D deduction of Rs 25,000 for medical insurance premium (can be higher if for senior citizens) Other deductions under Chapter VIA, which include interest on savings account (80TTA), interest for educational loan repayment (80E), additional interest on housing loan (80EEA), donations (80G) etc The new tax regime option can be availed on a year-on-year basis for taxpayers earning income other than business income. Some of the common exemptions that cannot be claimed are: Leave Travel Allowance, Housing & certain allowances which are incurred wholly for the purpose of business, meal vouchers, etc. While opting for the new regime, only employer contribution to NPS or the National Pension System is allowed as a deduction. The new tax rates are as under: Taxable Income Slab (INR) Under the new Personal Income Tax Regime introduced in Finance Act 2020, individual taxpayers can avail the option of lower tax rates by not availing almost all generally claimed exemptions and deductions.
Income Tax Slabs and Rates in India for 2021-22: New Regime
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