Tax Rates: Income Tax Slabs for Individuals:
- Personal Income tax rates slabs is proposed to be changed. The basic exemption is proposed to be increased to Rs. 1,60,000. Therefore the minimum tax saving for every individual would be Rs. 1,030. For the Income Earners, above 10 lacs, the savings is high (around 10%) as the surcharge on Income Tax is removed. The Educations Cess of 3% remains as it is. New Pension System (NPS)
- The Tax Benefit Under Section 80CCD has been
extended to "self employed" individuals as well. - It is also proposed to amend the Explanation to the
said section to provide that for the purposes of the said
section the assessee shall be deemed not to have
received any amount in the previous year if such
amount is used for purchasing an annuity plan in the
same previous year. These amendments will take
effect retrospectively from 1st April, 2009 and will,
accordingly, apply in relation to assessment year
2009-2010 and subsequent years
Limits of Section 80DD increased Medical treatment for handicapped dependants limit of Rs. 75,000 increased to Rs. 100,000. Donations given to Political Party or Electoral Trust To have the transparency in the money coming for elections, it is proposed to provide the 100% deductions to all assessee who donate money to political party or electoral trust Perquisites: Section 17
- It is proposed that value of any specified security or sweat shares allotted to employee free of cost or at
concessional rates will be perquisite. The value will be the fair market value on the date on which option is
exercised as reduced by the amount paid by the
employee. - It is also proposed to include as perquisite employers contribution in excess of Rs. 1 lakh to approved
superannuation fund. - IT is proposed to include as perquisite value of any other fringe benefits or amenity as may be prescribed.
The Amendment will take effect from 1/4/2010.
Interest of Loan taken for Higher Education:Section 80E In order to extend the benefit to more persons, it is proposed to define Higher Education to mean any course of study after passing Senior Secondary Examination.The Amendment will take effect from 1/4/2010 onwards. Voluntary Retirement: Section 89 It is proposed that if Benefit of exemption U/s 10(10C) is availed of by an employee for the amount received on voluntary retirement, no relief would be available u/s 89. The Amendment will take effect from 1/4/2010.
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