Click on the following links to read the amendments provided in the previous posts
4. Know everything about section 32AD
5. Amendment in section 36 of P/G/B/P
6. Amendment in scientific research
Today, we are posting the amendment related to Chapter VIA.
Section 80C
According to section 80C(2)(xviii), deposit under a notified
scheme would be qualified for deduction within the overall ceiling of Rs.
1,50,000. For this purpose, Sukanya Samriddhi Account Scheme has been notified
vide Notification No. 9/2015.
Amendment
For allowing the deduction under section 80C to the parent
or legal guardian of the girl child, section 80C has been amended by the
Finance Act, 2015. The amended provisions provide that a sum paid or deposited during the year in the above scheme by an
individual in the name of individual, or any girl child of the individual or in
the name of any girl child for whom such an individual is the legal guardian,
would be eligible for deduction under section 80C. No deduction will be
allowed if the amount is deposited by a HUF.
Amendment to section
80CCC
The monetary ceiling
of Rs. 1,00,000 under section 80CCC has been increased to Rs. 1,50,000 from the assessment year 2016-17
Amendment to section
80CCD
The following amendments have been made to the scheme of
section 80CCD from the assessment year 2016-17-
1.
The ceiling of Rs. 1,00,000 as per section
80CCD(1A) has been removed.
2.
A new sub-section (1B) has been inserted in
section 80CCD for providing an additional deduction in respect of any amount
paid (up to Rs. 50,000) for contribution made by any individual assessee under the National Pension Scheme(NPS). On
this additional contribution, the ceiling of Rs. 1,50,000 under section 80CCE
will not be applicable.
The table given below highlights
the amendments made to section 80CCC and 80CCD
From the assessment year
2016-17
|
||
Maximum deduction under relevant section
|
Cumulative maximum deduction [sec. 80CCE]
|
|
Section 80C
|
Rs. 1,50,000
|
Rs. 1,50,000
|
Section 80CCC
|
Rs. 1,50,000
|
|
Section 80CCD(1) (i.e. employee's contribution or assessee's
contribution towards NPS
|
10% of "salary" [for a self-employed person: 10% of
GTI]
|
|
Section 80CCD(1B) (i.e. contribution to NPS by an individual
|
Rs. 50,000
|
Not applicable
|
Section 80CCD(2) (i.e. employer's contribution towards NPS)
|
10% of salary
|
Not applicable
|
Example: A is in service of XYZ Ltd. since 1988. Currently, his
basic salary plus dearness allowance is Rs. 12,00,000. He contributes Rs.
1,75,000 towards NPS, deposits Rs. 40,000 in PPF and deposits Rs. 60,000
towards annuity plan of LIC which is eligible for deduction under section 80CCC
(total investment in NPS, annuity plan and PPF is Rs. 2,75,000). XYZ Ltd.
contributes Rs. 1,30,000 towards NPS and gives annual bonus of Rs. 4,40,000. Bank
FD interest of A for the previous year 2015-16 is Rs. 4,00,000.
Rs.
|
Rs.
|
|
Basic salary and DA
|
12,00,000
|
|
Bonus
|
4,40,000
|
|
Contribution of XYZ Ltd. towards NPS
|
1,30,000
|
|
Income under the head "Salaries"
|
17,70,000
|
|
Income from other sources
|
4,00,000
|
|
Gross total income
|
21,70,000
|
|
Less: Deduction u/s 80CCD(1B) [contribution by A towards NPS,
subject to maximum of Rs. 50,000]
|
50,000
|
|
Less: Deduction u/s 80CCD(2) [contribution by XYZ Ltd. of Rs.
1,30,000 or 10% of salary, whichever is less]
|
1,20,000
|
|
Less: Deduction u/s 80C
|
40,000
|
|
Less: Deduction u/s 80CCC
|
60,000
|
|
Deduction u/s 80CCD(1) [ contribution: Rs. 1,25000*, 10% of
salary, whichever is less
|
1,20,000
|
|
Total
|
2,20,000
|
|
Subject to maximum ceiling of Rs. 1,50,000
|
(1,50,000)
|
|
Net income
|
18,50,000
|
*NPS contribution by A: Rs.
1,75,000 minus Rs. 50,000 [i.e. amount claimed as deduction u/s 80CCD(1B)]
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