Taxexcel

Thursday, 1 September 2022

Tax Saving Tips |

1. Sukanya Samridhi Yojana (SSY)

Has become one of the most important tax-saving schemes is Sukanya Samriddhi Yojana. It was launched in 2015 by the Government of India as part of the Beti Bachao Beti Padhao campaign. This had a great impact on the general public. The scheme allows fixed-income investments, through which the taxpayer can invest regular deposits and at the same time earn interest on them. An investment in Sukanya Samriddhi Yojana is also considered an eligible deduction under section 80C of the Income Tax Act.

The Government of India sets the interest rate on the scheme quarterly, which must be paid at the end of the term. The scheme has a fixed period of 21 years and expires after 21 years. Minimum deposit Rs. 250 is required to be done per year for 15 years. Failure to pay the minimum amount within one year will result in account termination. To reactivate your account, you must pay a fine of 50,000 rubles. 50 along with the original Rs. deposit 250 rubs.

You may also like- Automated Income TaxForm 16 Part B for the F.Y.2021-22[This Excel Utility can prepare at a time 50 Employees Form 16 Part B]

To open a Sukanya Samriddhi account, below are the eligibility criteria for this tax savings option:

Only girls can claim the benefits of this scheme.

The girl was less than 10 years old. There is a grace period of one year that allows a father to invest 1 year of a 10-year-old daughter.

The investor must provide proof of the daughter's age.

2. National Savings Certificate

An initiative of the Government of India, the National Savings Certificate is a fixed-income investment scheme designed for small and medium-sized investors to invest and earn significant returns. It is considered a low-risk investment and is as safe as the Reserve Fund.

Investments in NSC are deductible under section 80C of the Income Tax Act up to Rs. 1.50k. In addition to the tax exemption, it provides the investor with full capital protection and interest guarantee. The following are some of the features of the NSC tax savings option:

The interest rate of 6.8% per annum is a guaranteed income.

You can claim tax credits under section 80C up to Rs. 1.5 l

You can invest from Rs. 1000 (or a multiple of 100 rupees). You can increase the investment amount as you see fit.

At the end of the term, the entire repayment amount will be received by the investor and will be taxed in the hands of the taxpayer.

Early check-out is not possible. You can use the same as collateral in case of bank or NBFC loans.

3. Savings deposit with a fixed tax

Term deposits are considered one of the safest tax-saving schemes. It is safer than investing in stocks in terms of risk and return. Banks decide on interest rates, and this depends on several factors. The following are some of the features of a term deposit to save taxes:

You may also like- Automated Income Tax Form 16 Part A&B for the F.Y.2021-22[This Excel Utility can prepare at a time 50 Employees Form 16 Part A&B]

An investment in a flat tax savings deposit that is deductible under Section 80C in calculating taxable income.

Minimum blocking period 5 years

Older people can get a higher interest rate on investments

In the case of a joint account, the main owner can take advantage of a tax deduction when calculating taxable income.

Savings deposits with a flat tax do not allow early withdrawal. However, after the 5-year lock-up period, investors have access to early withdrawals. Early withdrawal conditions vary from bank to bank.

4. Savings scheme for the elderly

The Senior Citizens Savings Scheme is an income tax savings scheme available to seniors residing in India. The scheme is available for investment through banks and post offices and offers one of the highest rates among various savings schemes.

Contributors can make investments with a minimum amount of Rs. 1000 and its multiples. The scheme also offers the possibility of cash investment if the investment amount is less than Rs. 1 million. Deposits made under the scheme are payable after 5 years. Depositors also have the option to extend the repayment period for another 3 years.

Investment in the Seniors Savings Program qualifies as a deduction under section 80C up to Rs. 1.5 lakh of taxable income. The interest on these deposits is fully tax-deductible and is tax-deductible if the interest exceeds Rs. 50,000. Deposits made to the Senior Savings Account are cumulative and paid annually.

Download Automated Income Tax Preparation Excel-Based Software All in One for the Government & Non-Government (Private) Employees for the F.Y.2022-23 and A.Y.2023-24

Feature of this Excel Utility:-

1) This Excel utility prepares and calculates your income tax as per the New Section 115 BAC (New and Old Tax Regime)

2) This Excel Utility has an option where you can choose your option as New or Old Tax Regime

3) This Excel Utility has a unique Salary Structure for Government and Non-Government employees Salary Structure.

4) Automated Income Tax Arrears Relief Calculator U/s 89(1) with Form 10E from the F.Y.2000-01 to F.Y.2022-23 (Update Version)

5) Automated Income Tax Revised Form 16 Part A&B for the F.Y.2022-23

6) Automated Income Tax Revised Form 16 Part B for the F.Y.2022-23

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Monday, 29 August 2022

Download Automated Income Tax Arrears Relief Calculator U/s 89(1) with Form 10 E from the Financial Year 2000-01 to the Financial Year 2022-23

Income tax arrears relief calculator u/s 89(1) downloads

Excel Form 10E - Withholding Salary A.Y 2023-24 Calculator of Benefits for Rebate under Section 89(1) Income Tax Act 1961 - Download

Under section 89(1) of the Income Tax Act 1961, an exemption from income tax was granted when an employee received late or advanced wages during a financial year. Under rule 21AA of the Income Tax Rules of 1962, Form 10-E was prescribed for benefits.

Subject to the above rule, if the worker is a government employee or an employee of a company, cooperative, municipality, university, institution, or association of bodies, he/she may, to claim compensation, file Form 10E with his/her employer, who is responsible for paying wages, as stated in subsection (1) section 192 of the Income Tax Act 1961

In all other cases, a person who is assessed as requiring an exemption must file a Form 10E application with their income tax inspector. An exemption under section 89(1) is permitted in the assessment year in which the employee received the delay or advance.

Wage reviews, especially in the public sector, have become commonplace. Since independence, the government has set up six payment commissions. Retroactive recommendations from each committee led to wage delays.

The reason for this section 89 benefit is that due to the payment of past due or advance wages received in a given fiscal year, the employee's income for that fiscal year is increased by the amount owed or advanced. As a result, the worker's earnings are taxed at a higher rate than the rate at which his earnings would have been taxed were it not for such delays or advances.

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Tuesday, 23 August 2022

New and old tax regime U/s 115BAC|In this New Tax System, A lot of doubt about the new tax regime.

People can't decide what to choose. Let's discuss the new tax regime.

The new tax regime has available for individuals, both for HUF, if you are a resident or a non-resident, and is optional. The new tax regime has preferential rates up to a taxable income of Rs. 15 lakh with tax slabs of 5%, 10%, 15%, 20% and 25% on income, upfront of 2.50 lakh of Rs base exemption. 2.50 Lakh If you wish to take advantage of the reduced tax slab rates under the new tax regime in lieu of the existing tax slabs, you must waive the tax deductions & exemptions available under the old tax regime.

As for employees, they are not eligible for important benefits such as standard deductions, housing allowance, vacation assistance, etc. if they choose the new tax regime. The senior citizen will not be able to claim the standard ex-employer's pension deduction, nor the section 80TB postal and bank interest deduction if they choose the new tax regime.

Download and Prepare at a time 50 Employees Form 16 Part B for the F.Y.2021-22

In addition, various deductions under Chapter VIA such as Section 80 C (consisting of various items such as EPF, LIP, tuition, PPF, NSC, ELSS, home loan repayment, etc.), 80 CCD (1) and 80 CCD (1B) (for NPS) 80D (for health insurance premiums) 80D for health insurance, 80G for donations, 80 TTA for bank savings interest, etc. but not available in the new tax regime.

If you have borrowed money to buy a home or renovate a home claiming autonomy, you are not eligible for the interest deduction, which is available up to Rs. 2 million a year. You will also not be able to offset the current loss, as well as the expected loss of ownership of the main home against current income if you choose the new scheme. Not only that, you are not allowed to carry any homeownership losses onto the rental property.

The total benefit from the transition to the new tax regime is about Rs. 75,000/- plus 4% deductible if your total income is Rs. 15 thousand. Since many exemptions and deductions can be claimed, and the composition of these tax credits varies from person to person, there is no ready answer to the question of which scheme works for you. However, looking at the tax credits that most taxpayers have to forgo, the benefits available under the existing scheme outweigh the lower rate benefits available under the new scheme, especially for employees and homeowners.

How to activate consent to the new scheme and switch between the old and new scheme

Those with no business or income must use this option each year by filing Form 10IE with the ITR, no later than the ITR filing deadline. those. July 31st and an option once exercised for a given year cannot be changed if you wish to file a revised report. Therefore, take into account all income, benefits and deductions when choosing a scheme for a given year.

Download and Prepare at a time 50 Employees Form 16 Part A&B for the F.Y.2021-22

Please note that under income tax law, using the new tax regime with your employer does not count as exercising the option. The use of the employer option has a limited purpose and you may choose an alternative scheme when filing an ITR. Be sure to file your ITR before the expiration date if you wish to opt for a new tax regime as this option is not available after the expiration date. However, you can stay on the old scheme for one year and on the new scheme the following year.

Those with business and income must exercise the option once and for all first by completing Form 10IE before the ITR filing deadline through the ITR, which can be filed later. This person can opt-out of the new tax regime only once, and then cannot return to the new tax regime if there is no business income that year. Therefore, you need to be very careful when choosing a new tax regime when you have business income, and you must take into account the composition of income not only of the relevant years but in all future years.

How does the scheme work?

Let's see how the circuit works with examples. Almost all employees receive HRA benefits for paying rent or buying a home with a mortgage. Assuming you bought a house with a mortgage, you will not be able to claim the benefits of a home loan with interest and principal repayment of Rs. 3.50 thousand together.

Bearing in mind the fact that you will also have to waive the standard deduction requirement. 50,000/- if you choose the new mode, losing all the benefits of Rs. 4,00,000/- leading to tax implications of Rs. 80,000 if you are on the 20% tax rate with an income between 5 and 10 lakhs.

Download and Prepare at a time 100 Employees Form 16 Part B for the F.Y.2021-22

The forgone net tax benefit is greater than the benefit of Rs. 62 500/- is accumulated for you under the new scheme. For those on the 30% tax slab, the tax effect of waiving the 30 % exemption will be 1.20 lakh compared to the Rs benefit. 75,000/- accumulated under the new regime.

We can also include exclusive benefits available for NPS Rs. $50,000 pursuant to Article 80 CCD (1B). So, apparently, the new scheme does not look attractive to the employee. Employees must determine their final tax liability when completing the ITR and select a regimen that will help them optimize their tax revenue.

From the example above, it becomes obvious that if someone is on a 20% or 30% tax rate, the current scheme is better for those who enjoy all the major deductions that people usually enjoy.

Let's move on to an example where a person has an income of up to Rs. 7 lakh and who will have to pay a tax of Rs. 32 500 / - if you choose the new model. However, if he can claim a deduction under section 80 C for Rs. 1.50 lakh and deduction of Rs. 50,000/- under Section 80 CCD (1B) for NPS and reduce his total income below 5 lakhs, he will not have to pay any taxes, taking advantage of the u/s 87A discount to Rs. 12,500/- Thus, by investing two lakh rupees, it will be possible to save rupees in taxes. 32 500 / - remained in the old regime. However, this scheme will work for self-employed people who don't want to save money to make investments that qualify for multiple deductions.

Download Automated Income Tax Preparation Excel Based Software All in One for the Government & Non-Government (Private) Employees for the F.Y.2022-23 and A.Y.2023-24