Income tax
Posted on :: Updated on :: money

In new regime, you taxed 30% on salary > 24L, whereas in old it's salary > 10L. Apart from the usual tax slabs, surcharge is also applicable if salary is greater than 50L.

Possible deductions

  • [only in old] Car: transport, maintainence, driver bills
  • [only in old] Professional Tax
  • [both] Standard deduction: 50k in old, 75k in new (available by default, requires no documentation)
  • [in both] food/meal 200/meal
  • [in both] gift 15k
  • [in both] telephone bills
  • [only in old] LTA
    • can be claimed for 2 journeys in 4 years gap
    • covers self + family
    • air, rail, bus for travel in india
  • [only in old] HRA
    • check changes recently
    • requires relationship with landlord, aadhar, pan etc
    • 2% TDS included in rent
  • [both] relocation charges
  • [both] conveyance allowance (commuting to work etc)
  • [only in old] helper
  • [only in old] child education upto 3k per month per child
  • [only in old] life insurance upto 1.5k under 80c
  • [both] NPS: upto 10% in old (additional 50k/yr), upto 14% in new
  • [only in old] Health insurance
  • [only in old] education loan - no limit
  • [only in old] home loan for self - 2L limit
  • [only in old] home loan for let out - no limit

PF Tax

If employer contribution > 7.5L annually, it'll be taxable. If interest amount > 2.5L tax is applicable.

Taxation in ESOPs and RSUs

  • RSUs are actual free shares available after vesting. No cost for holding. On selling it's taxed as per income slab.

  • ESOPs gives an options for employee to buy share at fixed discounted price, requires paying exercise amount. It is taxed twice, once when it's exercised, based on difference between FMV (Fair Market Value) and exercise price. And then again on selling based on capital gains tax.

Foriegn assets disclosure

According to new IT rules, you're required to share all foriegn assets, i.e, RSUs & ESOPs for public shares, including overseas mutual/index fund. This doesn't apply pre IPO, if there's no valuation. If foriegn assets are greater than 20L and not declared, it attracts a penalty of 10L.

Business

If you've business income, you can't switch tax regime once selected. Really? #question

Form 26AS

It's a consolidated tax statement for all taxes which are deducted, like TDS, TCS for a PAN.

Sources