Union Budget 2015-16: How can you save Rs. 4,44,200 through Tax Planning?
Updated on March 2, 20152 mins read
The Finance Minister, Arun Jaitley in the Union Budget 2015-16, made some important tax announcements that will affect your Tax calculation. An important announcement was that an individual tax payer could get upto tax benefit of Rs. 4,44,200 through careful tax planning.
Here’s how you can take full advantage of the Tax concessions and increase your savings:
2. Avail benefits of National Pension Scheme and get deduction under 80CCD of upto Rs. 50,000. Also, employees can now choose between NPS and EPF. The contribution to EPF has been made optional for employees below a certain income.
3. Deduction on account of interest on home loan (self-occupied property) of upto Rs. 2 lakhs
4. Transport allowance for individual salaried employees has been doubled to Rs 1,600 per month from the existing Rs 800 per month. This option alone could help you save 19,200 per year. (Transport allowance is granted to an employee to meet expenditure on commuting between place of residence and place of duty. The amount paid under this head is exempt from taxation.)
5. Protect your health and take benefit of the health insurance premium deduction limit which has been increased by to Rs.25,000, from Rs. 15,000 in this year’s. (For senior citizens and very senior citizens, this limit has been hiked from Rs 20,000 to Rs 30,000.)
If you add the individual components above, you can save upto Rs. 4,44,200 in a year: Rs. 1.50 lakh + Rs. 50,000 + Rs. 2 lakhs + Rs. 19,200 + Rs. 25,000 = Rs. 4,44,200
Some other important announcements related to Taxation made by the FM in this year’s Budget include:
1. The FM re-iterated his intent to create a direct tax regime which is internationally competitive with regards to the tax rates and hence kept the Income Tax slabs and rates unchanged.
2. The Wealth Tax has been abolished and an additional 2% surcharge for the super rich with income of over Rs. 1 crore was announced in the Budget.
3. The government has also committed that the GST will be effective by April 1st 2016 which will bring uniformity in tax rates.
4. Effective 1 June 2015, TDS will be applicable on interest earned from bankrecurring deposits along with interest on fixed deposits.
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