Download Automated Income Tax Form 16 for Financial Year 2018-19

Click here to Download Automated 100 Employees Master of Form 16 Part A & B for Financial Year 2018-19 and Assessment Year 2019-20

[This Excel Based Software can prepare at a time 100 employees Form 16 Part A&B for the Financial Year 2018-19 and Assessment Year 2019-20.]

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Automated All in One TDS on Salary for Govt & Non-Govt Employees for F.Y. 2018-19 With what is the Maximum Income Tax You can Save for FY 2018-19

What is the Maximum Income Tax I can save for this Year (FY 2018-19)? A question I am often asked. Tax laws keep changing year on year, especially in Budget. In this post, we summarize all the tax saving sections. 

S. No.Tax Sections Description Maximum Tax Exemption Limit (Rs.)180C/ 80CCC/ 80CCDInvestment in EPF, ELSS, PPF, FD, NPS, NSC, Pension Plans, Life Insurance, SCSS, SSA and NPS. Also includes Home Loan Principal repayment, Tuition Fees, Stamp Duty.

Best Tax Saving Investments u/s 80C150,000/-

80CCD(1B)Investment in NPS 50,000/-

24(B) Interest paid on Home Loan for Self occupied homes.

You can claim Tax Benefit on both HRA & Home Loan – Know How?

You can claim Rs.2,00,000/- as H.B. Loan Interest U/s 24(b) & Rs. 1,50,000/- can claim as H.B.Loan Principle U/s 80C

U/s 80E:- Interest paid on Education Loan. No Limit – Rs 50,000 is just an assumed value

Download Automated All in One TDS on Salary for Govt & Non-Govt Employees for F.Y.2018-19 and A.Y. 2019-20 [ This Excel Utility can prepare at a time Income Tax Computed Sheet + Individual Salary Sheet + Individual Salary Structure for Government and Private Employees Salary Pattern + Automated H.R.A. Exemption U/s 10(13A) + Automated Arrears Relief Calculation U/s 89(1) with Form 10 E From F.Y.2000-01  to F.Y.2018-19 + Automated Form 16 Part B and Form 16 Part A&B ]

Tax Benefit on Education Loan (Sec 80E)

50,000/-

80DPremium payment for medical insurance for self and parents. Includes Rs 5,000 limit for the preventive health checkup

Making Sense of Tax Benefit on Health Insurance u/s 80D Max Rs.:-60,000/-

80DDBTreatment of Serious illness for self and dependents (Limit of Rs 1,00,000 for Senior Citizens and Rs 40,000 for others)80,000/-

Sec 80U:- Physically Disabled Taxpayer (Rs 75,000 for 40% to 80% disability and Rs 1,25,000 for more than 80%)125,0000/-

Sec 80DD :-Physically Disabled Dependent (Rs 75,000 for 40% to 80% disability and Rs 1,25,000 for more than 80%)125,000/-

Sec 80G: -Donation to approved charitable funds like Prime Minister Relief Fund, etc (assumed value)50,000/-

Sec 80GGA:- Donations for scientific research or rural development (assumed value)50,000/-

Sec:-80GGCDonations to political parties (assumed value)50,000/-

Sec:- 80TTA Interest received in Savings Account

10,000/-

 Sec 80TTB: -Interest Income for Senior Citizens Only

Learn all about Section 80TTB (introduced in Budget 2018)

50,000/-

Sec 10(15)(i):- Interest up to Rs 3,500 for single holder account and up to Rs 7,000 for joint account in Post Office Saving Account 7,000/-

Sec 80GG:-For Rent Expenses who do have HRA component in salary

How to Claim Tax Benefit for Rent Paid u/s 80GG? Maximum Tax Exemption Rs.60.000/- P.A.

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Income Tax Calculator for F.Y.2018-19 With Allowances Exempt From Tax For Salaried Person [Most Useful] for F.Y. 2018-19

If you are a salaried people, you have many ways to save tax. The allowances are one of the best ways to reduce the tax outgo. However, the tax saving from the allowances depends upon your employer. Because the only employer can decide to give you a particular allowance. If there is an allowance in your salary structure only then you can avail tax benefit.

Allowances are a fixed payment to the employee apart from the salary. This payment is given for some particular requirement of the employee. e. g Uniform Allowance, driver allowance etc. There are generally three types of allowances  – taxable allowances fully exempted allowances and partially exempted allowances.

In this post, I have listed the most useful tax exempted allowances, fully or partially. I hope using these allowances; you would be able to save a good amount of tax.

Click here to Download automated Income Tax Calculator for Salaried Persons for the Financial Year 2018-19 & Ass Year 2019-20 [ As per Finance Budget 2018]

Common Allowances

These allowances are available to private and government employees both. If your employer gives these allowances, you would not pay 100% tax on these.

House Rent Allowance

·             This is the most common and useful allowances. This allowance alone If your employer gives you the house rent allowance (HRA)and you live in rent, you would be eligible for tax exemption on HRA.

·             Even, you can pay rent to your parents to avail tax benefit of HRA. In this case, the house should be owned by your parents.

·             If you are paying more than Rs.1 lakh rent for a year, you have to give PAN of your landlord.

·             You would not get the full exemption on HRA. The tax exemption is given to the least of the following amount.

1.     Actual HRA Received

2.     40% of annual salary (For metro 50%)

3.     Rent Paid – 10% of your salary (basic + DA)

Leave Travel Allowance  (Abolished)

This allowance is related to your vacations. In the LTA, your employer gives this allowance for a holiday. The employer bears the burden of traveling through this allowance. The LTA is eligible for tax exemption. There is no maximum limit on LTA. It is the employer who gives LTA as per its wish. However, for tax exemption, you have to present the proof of travel. The tickets are required as the proof.

Note, the travel should be within India. The exemption is only for the travel. Food, and stay are not considered for exemption. You can take family members with you. The family means your spouse, children, and parents.

You can claim LTA twice in 4 years. The dates for this 4 years is prefixed. The current 4-year block is 2018-2021. During this tenure, you can avail LTA exemption twice any time.

Education Allowance

If your employer gives Allowance for children education, it is also exempted from tax. However, there is an upper limit of ₹100 per month per child. Thus total exemption is available on an allowance of 2400 in a year.

Hostel Allowance

If your children are living in the hostel and your employer gives hostel allowance, this allowance is also exempted from tax. The maximum amount of exemption is ₹200 per month per child.

Uniform Allowance

Often companies give uniform allowance to its employee. It is given to maintain proper uniform during the job. The Allowance given for this purpose is also exempt from tax. There is no upper limit for this allowance. There is no maximum limit for the exemption. However, the expense should be real.

Research or Academic Allowance

There are some jobs which require on job learning and research. Hence companies promote research and learning by giving allowance for this. Such allowance is also exempted from tax. There is no upper limit for this exemption.

Daily Allowance

Daily Allowance is given to an employee when he/she performs duty outside of his normal place. This allowance is given for food, lodging and other expenses of the employee. If your employer gives this allowance, this would be fully exempted from tax. There is no maximum limit for this.

Conveyance Allowance(Abolished)

Your employer can also give you the conveyance allowance. This allowance is given if you travel in course of your job. However, the exemption would be given on actual expense.

Transport Allowance(Abolished)

Sometimes people confuse conveyance allowance with transport allowance. Transport allowance is given for the commute between your place of work and home. There had been tax exemption on this allowance. The maximum limit of this allowance was Rs.1600/month.

However, this exemption was withdrawal from the Budget 2018. In place of this exemption, the government gives standard deduction.

Medical Allowance

This allowance is given to meet the medical expense of employee and family. But now this allowance is not exempted from the tax. The government is giving Standard deduction in place of exemption on this allowance. There was an upper limit of ₹15,000/year for the exemption.

Helper/Assistant Allowance

In a senior position, you may be entitled to the Helper/Assistant Allowance. It is also exempted from the tax.

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Income Tax Calculator for F.Y.2018-19 With Allowances Exempt From Tax For Salaried Person [Most Useful] for F.Y. 2018-19

If you are a salaried people, you have many ways to save tax. The allowances are one of the best ways to reduce the tax outgo. However, the tax saving from the allowances depends upon your employer. Because the only employer can decide to give you a particular allowance. If there is an allowance in your salary structure only then you can avail tax benefit.

Allowances are a fixed payment to the employee apart from the salary. This payment is given for some particular requirement of the employee. e. g Uniform Allowance, driver allowance etc. There are generally three types of allowances  – taxable allowances fully exempted allowances and partially exempted allowances.

In this post, I have listed the most useful tax exempted allowances, fully or partially. I hope using these allowances; you would be able to save a good amount of tax.

Common Allowances

These allowances are available to private and government employees both. If your employer gives these allowances, you would not pay 100% tax on these.

House Rent Allowance

·             This is the most common and useful allowances. This allowance alone If your employer gives you the house rent allowance (HRA)and you live in rent, you would be eligible for tax exemption on HRA.

·             Even, you can pay rent to your parents to avail tax benefit of HRA. In this case, the house should be owned by your parents.

·             If you are paying more than Rs.1 lakh rent for a year, you have to give PAN of your landlord.

·             You would not get the full exemption on HRA. The tax exemption is given to the least of the following amount.

1.     Actual HRA Received

2.     40% of annual salary (For metro 50%)

3.     Rent Paid – 10% of your salary (basic + DA)

Click here to download Automated H.R.A. Exemption Calculator U/s 10(13A)

Leave Travel Allowance  (Abolished)

This allowance is related to your vacations. In the LTA, your employer gives this allowance for a holiday. The employer bears the burden of traveling through this allowance. The LTA is eligible for tax exemption. There is no maximum limit on LTA. It is the employer who gives LTA as per its wish. However, for tax exemption, you have to present the proof of travel. The tickets are required as the proof.

Note, the travel should be within India. The exemption is only for the travel. Food, and stay are not considered for exemption. You can take family members with you. The family means your spouse, children, and parents.

You can claim LTA twice in 4 years. The dates for this 4 years is prefixed. The current 4-year block is 2018-2021. During this tenure, you can avail LTA exemption twice any time.

Education Allowance

If your employer gives Allowance for children education, it is also exempted from tax. However, there is an upper limit of Rs.100 per month per child. Thus total exemption is available on an allowance of Rs. 2400 in a year.

Hostel Allowance

If your children are living in the hostel and your employer gives hostel allowance, this allowance is also exempted from tax. The maximum amount of exemption is Rs.200 per month per child.

Uniform Allowance

Often companies give uniform allowance to its employee. It is given to maintain proper uniform during the job. The Allowance given for this purpose is also exempt from tax. There is no upper limit for this allowance. There is no maximum limit for the exemption. However, the expense should be real.

Research or Academic Allowance

There are some jobs which require on job learning and research. Hence companies promote research and learning by giving allowance for this. Such allowance is also exempted from tax. There is no upper limit for this exemption.

Daily Allowance

Daily Allowance is given to an employee when he/she performs duty outside of his normal place. This allowance is given for food, lodging and other expenses of the employee. If your employer gives this allowance, this would be fully exempted from tax. There is no maximum limit for this.

Conveyance Allowance(Abolished)

Your employer can also give you the conveyance allowance. This allowance is given if you travel in course of your job. However, the exemption would be given on actual expense.

Transport Allowance(Abolished)

Sometimes people confuse conveyance allowance with transport allowance. Transport allowance is given for the commute between your place of work and home. There had been tax exemption on this allowance. The maximum limit of this allowance was Rs.1600/month.

However, this exemption was withdrawal from the Budget 2018. In place of this exemption, the government gives standard deduction.

Click here to Download Income Tax Calculator for Financial Year 2018-19 & Ass Year 2019-20 as per Finance Budget 2018

Medical Allowance

This allowance is given to meet the medical expense of employee and family. But now this allowance is not exempted from the tax. The government is giving Standard deduction in place of exemption on this allowance. There was an upper limit of Rs.15,000/year for the exemption.

Helper/Assistant Allowance

In a senior position, you may be entitled to the Helper/Assistant Allowance. It is also exempted from the tax.

Read More