The interest earned on the EPF contribution by the employees is generally exempt from tax. However, in Budget 2021 it was proposed to make the interest earned on the PF contributions exceeding Rs. 2,50,000 in a financial year taxable. However, for government employees this limit is Rs. 5 lakh. Read this article to understand more about the taxability of interest on EPF contributions. EPF Interest Rate FY2025-26:EPF Interest Rate for FY 2025-26 has Retained at 8.25%What is EPF?Employee Provident Fund (EPF) is a retirement benefits scheme for salaried employees.

The new tax regime under section 115BAC of the Income Tax Act, 1961 offers relaxed slab rates and limited deductions to the tax payers. Assessees who have a simple income structure with little to no deductions can find the new regime more beneficial.Key Highlights of the New Tax RegimeNew Tax Regime offers a basic exemption of Rs. 4 lakh and a tax rebate of up to Rs. 60,000.Taxpayers enjoy tax-free income up to Rs. 12 lakh and salaried individuals enjoy tax-free income up to Rs.

For a salary level of Rs. 10 lakhs, the tax liability under the new regime is nil, due to relaxed tax slabs and increased rebate up to Rs. 12 lakhs. However, under the old regime, the tax liability differs based on the amount of tax saving deductions available to the assessee.Tax Deductions under the Old RegimeUnder the old regime, there are various deductions and exemptions available against salary income. The following table demonstrates the maximum deductions and exemptions available against salary income.ExemptionsSalary ComponentsTaxabilityBasic PayFully-taxableDearness Allowance (DA)Fully-taxableHouse Rent Allowance (HRA)Exemption up to a certain limit. Leave Travel Allowance (LTA)Actual travel ticket expenses exempt for two  trips in 4 years under 10(5).

Selecting the correct ITR form is an important step in filing the taxes. Taxpayers can determine which ITR to file based on their sources of income, residential status, level of income, legal status of the taxpayer (individual, firm, company), etc., Key HighlightsThe ITR form applicable depends on the type and amount of income of the taxpayer as follows: ITR 1: Salaried individuals with income up to Rs. 50 lakhITR 2: Individuals with capital gainsITR 3: Income from business or professionITR 4: Income From Business and Profession < Rs. 50 lakhITR 5: Firms, LLPs, AOPs, and BOIsITR 6: Companies ITR 7: Charitable trustsWhat is ITR?Income Tax Return (ITR) is a form used by taxpayers to report their income and taxes to the Income Tax Department. Filing must be done before the specified due date each year.

Deduction under Section 80DD of the income tax act is allowed to Resident Individuals or HUFs against expenditure incurred for caretaking of a disabled dependent, who is differently-abled and is wholly dependent on the individual (or HUF) for support & maintenance.Conditions to Avail of Section 80DD DeductionBelow are the conditions you must meet to avail this deduction –Deduction is allowed for a dependant of the taxpayer and not the taxpayer himself.The deduction can only be claimed by resident individuals of India.The taxpayer is not allowed this deduction if the dependant has claimed a deduction under section 80U for himself/herself.Dependant in case of an individual taxpayer means spouse, children, parents, brothers & sisters of the taxpayer. In case of a HUF means a member of the HUF.The taxpayer has incurred expenses for medical treatment (including nursing), training & rehabilitation of the differently-abled dependant or the taxpayer may have deposited in a scheme of LIC or another insurer for maintenance of the dependant.The disability of the dependant must not be less than 40%.Disability is defined under section 2(i) of the Persons of Disabilities Act, 1995. #inlineCTA-choosePlan{ display: flex; flex-direction: row; align-items: flex-start; flex-wrap: wrap; padding: 24px 0; border-top: 1px solid #C4C4C4; } #inlineCTAimage{ padding-right: 20px; } #CTAbody{ flex: 1 1 50%; } #inlineCTAhead{ color: #314259; font-size: 20px; font-weight: 700; padding-bottom: 8px; } #inlineCTAcontent{ font-size: 16px; color: #9092A3; font-weight: 400; } #inlineCTAbutton{ padding: 8px 24px; color: #1678FB; font-size: 16px; background-color: #FFF; border: 1px solid #1678FB; border-radius: 8px; font-weight: 700; text-decoration: none; 8px 0 10px; } #inlineCTAbutton:hover{ background-color: #1678FB; color: #fff; box-shadow: 4px 5px 10px rgb(0 0 0 / 14%); } @media only screen and (max- 600px){ #full-width-mob, #inlineCTAbutton{ 100%; } #inlineCTAhead { font-size: 19px; padding: 8px 0; } #CTAbody{ flex: 1 1 100%; } } What is the Maximum Amount of Deduction allowed under Section 80DD?Fixed amount of deductions are allowed under Section 80DD, irrespective of the actual expenditure. However, the amount of deduction depends on the severity of the disability.DisabilityDeduction AmountDisability < 80%Rs. 75,000Disability > 80%Rs. 1,25,000Necessary Documents to Claim Tax Deduction Under Section 80DDThe following documents will be required to be submitted to claim tax benefits under Section 80DD of the Income Tax Act, 1961:Medical Certificate: In order to avail of tax deduction under Section 80DD, the taxpayer is required to provide a copy of the medical certificate as evidence of the dependent's disability.Form 10-IA: If the dependent with a disability is affected by autism, cerebral palsy, or multiple disabilities, it is necessary to submit Form No.

Senior Citizen Savings Scheme is a government backed retirement plan for individuals aged above 60 years. Eligible individuals can invest a minimum of Rs. 1000 up to Rs. 30 lakh for a period of 5 years with SCSS interest rate of 8.2% per annum. The principal amount invested can be claimed as a deduction under section 80C of the Income Tax Act up to Rs.

You can claim deduction against a personal loan interest and principal repayment in cases like home loan, vehicle loan, education loan, etc. However, the eligibility to claim such deduction depends on various factors like the regime chosen, and satisfaction of other criteria mentioned in the act.Tax Benefit On Personal LoanThe key factor in determining whether you can claim these benefits is the intended use of the loan amount. You can claim these benefits as long as you can provide evidence that the funds were used for that specific purpose.Home RenovationIf you take a personal loan to renovate or repair your home, then you will be eligible for a tax deduction under Section 24(b) of the Income Tax Act. You can claim deductions of up to Rs.30,000 per year on the interest paid on a personal loan. Home Purchase or ConstructionIf you take a loan for the purchase or construction of a house, you can claim a deduction of the interest paid on such loan. If the house is used for self-occupation, you can claim an interest deduction of up to Rs.2,00,000. However, this limit is reduced to Rs.30,000 if the purchase or construction is not completed within five years from the end of the financial year in which the capital was borrowed. If you let it out on rent, then the entire interest amount qualifies for a tax deduction. However, if you opt for new regime then deduction is available only on the property which is let out. Under section 80C, deduction of up to Rs.

The Finance Minister, Nirmala Sitharaman, unveiled the Union Budget 2023 on 1st February 2023. Generally, the budget before general elections is always a much-anticipated one with everyone hoping for big, bold moves. But most budgets tend to fall short on the surprise factor. This year's budget was no exception as it was mostly just a repackaging of old schemes with additional fund allocation. But salaried taxpayers were in for a surprise. They got the much needed tax break.

The Income Tax Act 1961 allows taxpayers to claim a deduction against the donations made to political parties without any limit under Section 80GGC i.e., the entire donation can be claimed as a deduction. However, the deduction is allowed only under the old tax regime and is not allowed under the new tax regime.What is Section 80GGC?Section 80GGC provides for tax deductions with respect to donations made by taxpayers towards political parties or any electoral trusts. Section 80GGC of the Income Tax Act was introduced to bring about transparency in electoral funding and free it from corruption. It also encourages individuals to financially support the political system and claim tax deductions against such donations to lower their tax liability.Who Can Avail 80GGC Deduction? Any person other than:Companies,Local authorities, andArtificial juridical person which is wholly or partly funded by the Government.Thus, any individual, Hindu Undivided Family (HUF), an AOP or BOI, a firm, and an artificial juridical person which is not wholly or partly funded by the government are eligible to claim deduction under Section 80GGC.It is also necessary to keep in mind the taxpayer must pay the taxes under the old tax regime to claim the benefit under section 80GGC.Section 80GGC Deduction LimitsThere is a certain limitation for deduction under Section 80GGC of the income tax. Here is the list of the 80GGC exemption limit:100% of a taxpayer’s donation to a registered electoral trust or political party can be claimed as deduction.

When the income of an individual taxpayer is below the basic exemption limit in a financial year, the tax liability is zero; thus, such individuals do not have to file any income tax return as per provision of Section 139(1) under the Income-tax Act, 1961. But if they file ITRs even when their income is below the basic exemption limit, it is termed ‘Nil Return’. What is a Nil Return?A nil income tax return is filed to show the Income Tax Department that you fall below the taxable income and therefore did not pay taxes during the year. Nil returns can be filed only when the income is below the exemption limit. As per the Income Tax Act, it is not mandatory for individuals earning less than the basic exemption limit to file an ITR. Thus, individuals filing nil returns file it in their interest.When Should I File a Nil Return?To show income tax return as proof of incomeThere are several instances where income tax serves as proof, say when you are applying for a visa or while getting your passport made.This is to continue maintaining a record and also preventative measures in the event of scrutiny from the Income Tax Department.To claim a refundYour total income without taking deductions into account could be above the taxable limit, but deductions might be below the minimum exemption limit. If you paid more in taxes than you needed to in the form of TDS, you must file an income tax return to claim a refund.How to File a Nil Return Online?Filing a nil return is no different from filing a regular income tax return.Enter your income details and deductions.