Rediff On The NeT: Tax advice for resident Indians


	HOME \| MONEY \| TAX \| Q & A

JANUARY 7, 2000

COLUMNISTS
STOCKS
MUTUAL FUNDS
NRI TAX
INDIAN TAX
INTERVIEW
PERSONAL FINANCE
PERSONAL BANKING
INSURANCE
REAL ESTATE
GOLD
CURRENCY

"How can I prevent tax deduction at source on company and bank fixed deposits?"

The Rediff Money Channel presents everything you wanted to know about tax issues, but didn't know whom to ask. Chartered Accountants from Ganesh Jagadeesh & Co are here to remove all your doubts.

Next year I will become a senior citizen. According to the Income Tax Act under section 88 B, there is a tax exemption upto the limit of Rs 10,000. My annual tax payable is less than Rs 10,000 after availing exemption under section 88 B by investing in public provident fund, mutual funds etc. I also have tax deducted at source against company fixed deposits and bank deposits. Can I submit Form 15 H from the next financial year so that I do not have to apply for tax refund?

- R L Gidwani

According to section 197(1A) of the Income Tax Act 1961:
No deduction of tax shall be made in case of a person (not being a company or a firm), if such person furnishes to the person responsible for paying any income of the nature referred to in section 193 (interest on securities) or section 194A (interest other than interest on securities), as the case may be, a declaration in writing in duplicate in Form 15 H and verified in the prescribed manner to the effect that the tax on his estimated total income of the previous year in which such income is to be included in computing his total income will be nil.
Accordingly you can submit form 15H from the next financial year in accordance with the provisions of the above section.

What is the applicable Inflation Index for year 1999-2000?

- D K Sharma

The Cost Inflation Index for the financial year 1999-2000 (AY 2000-01) is 389 according to Notification No. 11805 dated September 20, 1999 issued by the Central Board of Direct Taxes (CBDT).

My annual salary income is Rs 380,000. I have availed the complete benefit under section of Rs 70,000, and section 80CCB (invested Rs.10,000 in LIC's Jeevan Suraksha). I have no other income other than salary. Will you please let me know if there is any other way by which I can reduce my tax liability?

- Ramji

On your annual salary:

under Section 16 (i) of the Income Tax Act, 1961, you will be allowed a Standard Deduction of Rs 20,000 (salary more than Rs 1 lakh but not more than Rs 5 lakh) or one-third of gross salary or Rs 25,000 (if salary income is Rs 1 lakh); and

u/s 16 (iii), the amount of profession tax or tax on employment paid by you will also be allowed as deduction.

You can invest in Mediclaim policies and avail of benefits upto Rs 10,000 on the premium paid for you, your wife, dependent children or dependent parents under section 80D. You can avail of benefit under section 80E if you have repaid any loan taken from an approved financial institution in case you have availed of any loan for higher education. This deduction is restricted to Rs 25,000. In case you have made any donation to any institution that has the permission under section 80G or is approved under the said section, you can get a deduction upto an amount which is prescribed under the section.

EARLIER Q&AS:

'How do I file tax returns if the original Form 16 is lost in transit?'

'Is income from moonlighting for a foreign firm taxable?'

'What is the tax concession available to an artist or a writer and under which section of the Income Tax Act?'

'Some mutual funds are deducting tax at source from tax savings schemes such as Magnum Gifts, while some are not. What is the real status?'

'How much deductions can I claim out of the House Rent Allowance that I receive from my company?'

Is PAN a must even if I am not paying income tax?

What are the possible ways of planning my tax payments using the Hindu Undivided Family status?

Send in your questions to money@rediff.co.in

Tell us what you think of this advice