Investing in Infrastructure bonds FY 2010 – 2011

As you know during FY 2010 – 2011 if you invest in long term infrastructure bonds you will get tax benefit. The limit of investment for tax benefit is Rs 20,000.

This Rs 20,000 is apart from the regular investments under section 8 0 ( c ). So after looking at this don’t make a quick decision to invest in these bonds to avail tax benefit. Consider your taxable income, other investment avenues, inflation etc before investing in it.

I have come across a good article and here giving the link for the readers. Please go through it and make decision whether to invest in these bonds or not.

Investing in long term infrastructure bonds

March 11, 2010 | Filed Under Income Tax | Leave a Comment

Income Tax new Slabs FY 2010 - 2011

Income Tax new Slabs FY 2010 – 2011

I know it’s some what late to write a post on new tax slabs of FY 2010 - 2011. But I am giving here the details of the slabs so that it would be easy to refer for the regular readers.

The finance minister’s announcement on new slabs for FY 2010 – 2011 in Feb brought much delight of middle class people. It would save nearly Rs 50,000 to some salaried classes. I will post an example calculation in a new post.

Your income - Tax liability(%)

General:

Rs 0 - 1,60,000 - Nill

Rs. 1,60,001 – Rs. 5,00,000 - 10%

Rs. 5,00,001 – Rs. 8,00,000 - 20%

Above Rs. 8,00,000 - 30%

Women:

Rs 0 - 1,90,000 - Nill

Rs. 1,90,001 – Rs. 5,00,000 - 10%

Rs. 5,00,001 – Rs. 8,00,000 - 20%

Above Rs. 8,00,000 - 30%

Senior citizen (65 years or above):

Rs 0 - 2,40,000 - Nill

Rs. 2,40,001 – Rs. 5,00,000 - 10%

Rs. 5,00,001 – Rs. 8,00,000 - 20%

Above Rs. 8,00,000 - 30%

Rs. 20,000 tax exemption will be provided for investments in long term infrastructure investment bonds. This is in addition to the already allowed exemption of Rs. 1,00,000 under section 80 ( c ).

Tax Exemption will be given for contribution to the Central Government Health Scheme (CGHS).

Please visit the below link for FY 2009 – 2010 tax slabs.

FY 2009 – 2010 tax rates

March 11, 2010 | Filed Under Income Tax | Leave a Comment

Income Tax saving idea : ELSS Mutual funds & ULIPS

Under Income tax Act section 80(C), you can reduce your taxable income by Rs 1,00,000. Investments in ELSS mutual funds & ULIP plans come under section 80(C).

ELSS mutual funds: ELSS stands for Equity linked saving schemes. These are equity oriented mutual funds. 3 years lock-in period is applicable for all ELSS schemes. That means, once you invest in these schemes, you should not redeem your units till the end of lock-in period. But you can receive the dividends on your invested amount which are taxable. Read more

February 1, 2009 | Filed Under Income Tax | Leave a Comment

Save Income tax with Life Insurance & Medical insurance premiums

Life Insurance is one of the tax saving instruments under section 80(C). You can avail tax benefit up to a maximum amount of Rs 1,00,000 in a financial year under section 80C. If you are paying an insurance premium for you or your spouse it can be exempted from tax. The redemption amount at the end of maturity is also not taxable for Life Insurance. Read more

February 1, 2009 | Filed Under Income Tax | Leave a Comment

Save Income tax with Home loan

Taking home loan is one of the good ideas for saving income tax. There are many reasons for this.

Home loan can reduce the taxable income by Rs 2,50,000 per financial year. This much amount is not possible with any other tax saving plans. Apart from tax benefits it could yield huge capital gains in the form of ‘land value appreciation’.

Home loan principal and interest on principal paid during a financial year can be exempted from tax. You can save Income tax on home loans under two different sections of Indian Income Tax. Read more

February 1, 2009 | Filed Under Income Tax | 3 Comments