MUST-KNOWN TAX BENIFITS YOU MUST BE AWARE ABOUT----- Along with Public Provident Fund, life insurance policies and home loans, there are other important tax deductions that you can claim- ** Medical expenses incurred on disability: Disability, be it that of your own self or that of a dependent, can be financially and emotionally taxing. Income tax laws allow you to claim deductions towards disability-related expenses. These expenses could be towards your own or your dependents disability. Dependents include spouse, children, parents and siblings. If you have a disabled dependent, a deduction of Rs 50,000 is allowed. In case of severe disability, this amount goes up to Rs 1,00,000. You can also claim deductions in case of expenses incurred towards your own disability ** Medical expenses incurred on diseases: If you are undergoing treatment for a specific disease or are spending towards your dependents treatment, you can claim deduction for it. The illnesses for which you can claim deduction are neurological diseases, malignant cancers, AIDS, chronic kidney failure and haematological disorders. Up to Rs 40,000 a year is deductible towards money spent on medical treatment and in case of senior citizens, this amount goes up to Rs 60,000. To claim the deduction, the taxpayer must produce a valid medical certificate from a doctor. ** Claim deduction on rent if you are not availing of HRA: If you are paying rent every month and are not receiving house rent allowance from your employer, you can claim deduction for this. Under Section 80GG, the least of the following three can be claimed as deduction: 1) rent paid less 10% of total income 2) Rs 2,000 a month 3) 25% of total income. This deduction is subject to the following conditions: 1) Taxpayer or his spouse or minor child should not own residential accommodation at the place of employment 2) Taxpayer should not be in receipt of house rent allowance 3) Taxpayer should not have self-occupied residential premises in any other place ** Deduction on amount paid under National Pension System: Under section 80CCD, employer contribution to National Pension System up to 10% of salary qualifies for deduction. ** Exemption from capital gains: Any capital gains made by you through sale of residential property are exempt from tax provided you buy a new house a year before or within two years after the date of transfer of such asset or you construct a residential property within three years from the date of transfer. You can also invest your capital gains REC / NHAI bonds, subject to specified conditions.
Posted on: Sat, 08 Mar 2014 09:29:41 +0000
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