15G Exempts TDS on Taxable Income below a threshold limit!

15G Exempts TDS on Taxable Income below a threshold limit!

Form 15G can be filed with the prescribed financial institution if the individual’s total income is less than the basic exemption amount.

Where interest income from time deposits with prescribed financial institutions for a financial year (FY) exceeds the required maximum (currently 40,000), TDS at the applicable rate is deducted, according to the rules of the Income Tax Act.

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When an individual’s total income is less than the basic exemption limit, he or she can file Form 15G with a prescribed financial institution (such as a bank) to request that no taxes be withheld from the interest income made on the deposits.

Furthermore, if the tax rate at which the total income is subject to tax is NIL or lower than the rate at which the TDS is deducted (regardless of any advance tax paid by the recipient of income), the recipient of income may apply to the jurisdictional tax officer in the prescribed form for a lower or NIL deduction certificate (LDC). Following an examination of the appropriate papers, the tax officer may issue an LDC indicating a lower rate of TDS deduction at his or her discretion. TDS will be deducted at the rate provided in the LDC in this circumstance.

7 ways in which taxpayers can reduce their tax liability

Separately, take notice of the following from the perspective of the timing of taxation of such income. The interest income you receive from recurring deposits is taxed under the heading “income from other sources” (IFOS) according to the accounting system you use on a regular basis (i.e. mercantile/cash basis).

As a result, if you have previously offered interest income or revenue from other sources on an accrual/receipt basis, you might use the same approach for income from these RDs. The interest income will be taxed at the slab rates that apply to you for the fiscal year in which it is received. Any TDS already deducted by the bank on these deposits during the relevant FY will be credited against the income tax you owe for that year. If the amount of taxes deducted at source is less than the appropriate tax rate, you must pay the difference in advance tax in the specified instalments.

7 ways in which taxpayers can reduce their tax liability

7 ways in which taxpayers can reduce their tax liability

Nobody enjoys paying taxes in this world. There is no way to avoid paying taxes if you have taxable income. However, effective planning from the start of the fiscal year might help you lower your tax liability.

Income tax rules in India have exempted certain expenses and investments from taxation, or if you make certain investments or incur certain expenses, you may be entitled to tax deductions and exemptions. As a result, such investments and expenses can help you minimise your tax liability.

Income tax rules in India have exempted certain expenses and investments from taxation, or if you make certain investments or incur certain expenses, you may be entitled to tax deductions and exemptions.

Here are seven strategies for lowering your tax bill:
1. Premium payments for life insurance, pension plans, and provident funds

Individuals can deduct up to Rs 1.50 lakh in payments for life insurance premiums, provident fund, PPF, investment in ELSS schemes, tuition fees paid for up to two children, National Savings Certificate, home loan principal repayment, and so on under Section 80C of the Income Tax Act 1961.

Section 80CCC allows you to deduct premiums paid for annuity and pension plans offered by insurance firms. Similarly, deductions can be claimed on investments made in the Central Government’s pension system under Section 80 CCD (1).

However, the total deduction for all three components combined cannot exceed Rs 1.50 lakh.

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2. Contribution to the National Pension System (NPS)

An extra deduction of up to Rs 50,000 can be claimed on NPS contributions made by employees under Section 80 CCD (1B). This is in addition to the investment made according to Section 80CCD (1).

A deduction for an employer’s NPS contribution can be claimed under Section 80 CCD2. However, the size of the tax benefit will be determined by the type of employer.

-The deduction limit is 10% of the basic wage plus dearness allowance if the employer is a PSU, state government, or any other private sector enterprise (DA).

If your employer is the federal government, you can deduct up to 14% of your basic salary plus DA.

GST exemption items: Govt sets up ministerial panels to review tax slabs 

3. Rental property income

An individual can claim a tax deduction of up to Rs 2 lakh on interest payments on a house loan or home improvement loan on a self-occupied property under Section 24(b). However, payments made toward the principal of a house loan can be claimed under Section 80C up to a maximum of Rs 1.50 lakh.

You cannot, however, claim this tax benefit if you have chosen the new tax regime.

4. Premium payment for health insurance

A deduction can be claimed under Section 80 D for premiums paid for health insurance for self and dependent family members, as well as for preventative health check-ups. However, there are certain limitations:

Section 80D allows a deduction of Rs 25,000 for self/spouse, dependent children, or patents. This deduction might be up to Rs 50,000 if the claimant or any family members are senior people. Only a Rs 5000 deduction is allowed under Section 80D for preventive health examinations.

Medical expenses incurred by a senior citizen can also be deducted up to Rs 50,000 under Section 80D.

5. Expenses for the care and treatment of a dependent who is impaired

Expenses for the maintenance or medical care of a disabled dependent can be deducted up to Rs 75,000. However, if you have a severe disability (80% or more), you may be eligible for a reduction of up to Rs 1.25 lakh.

6. Medical treatment reimbursement

A deduction of up to Rs 40,000 can be claimed under Section 80 DD (1B) for medical expenditures incurred by self and dependent family members for specified diseases. If one of the family members is a senior citizen, the deduction limit would be increased to Rs 1 lakh.

7. The amount of interest paid on a student loan

An individual can deduct interest paid on an education loan taken for the higher education of a dependent child or spouse under Section 80E. It’s worth noting that there’s no maximum limit to this deduction.

Today’s Updated News

Certicom Updates

1. 30.11.2021 and 30.09.2021 is extended the date to upload 15G/H forms of Jun quarter and Payment under Vivad se Vishwas Scheme respectively.

2. SEBI barred Kotak Mahindra Asset Management, one of the country’s largest mutual fund managers, from launching any fixed maturity plans (FMPs) for six months and fined it for breaking rules and hurting investor interests.

3. GSTN has asked taxpayers who have not filed their pending GSTR-3B, especially from period November 2020 and afterwards, to do so at the earliest Taxpayers who have not filed GSTR-3B return for the past two months will not be allowed to file GSTR-1 return from next month,

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4. GST collections dipped around 4% to Rs 1.12 lakh crore in August, compared to Rs 1.16 lakh crore in the previous month, but policymakers and experts remained upbeat about revenues remaining strong in the coming months on account of improved economic activity.

5. Upcoming GST Council meeting on September 17 will focus on the extension of compensation cess as the Council may also look into duty inversion in specific sectors. States are demanding the extension of compensation cess for another five years.