How to get more Deduction in Tax for the Financial Year 2015-16

How to get more Deduction in Tax for the Financial Year 2015-16

You will be eligible to claim some more tax deductions for financial year 2015-16. Here is a quick update of the revised limit under various Income Tax sections that you must remember to claim this year.

1. Deduction limit on your medical insurance premium paid for self, children and spouse under Section 80D of Income Tax Act has been increased to Rs 25,000 per annum from earlier Rs 15,000 per annum. One can also claim a deduction of up to Rs 30,000 for medical insurance premium paid for parents against Rs 20,000 earlier. In case of senior citizen, the limit has been revised to Rs 30,000 per annum from earlier limit of Rs 20,000.

2. This year, you can claim an additional deduction of Rs 50,000 towards contribution made to New Pension Scheme (NPS) under Section 80CCD (1B) of Income Tax Act. This is apart from Rs 1.5 lakh deduction available under Section 80C. Now, the combined deduction under Section 80C and 80CCD (1B) is Rs 2 lakh.

3. You can also claim a deduction of Rs 75,000 per annum under Section 80DD on the medical expenses incurred on a dependent relative with disability (more than 40 per cent but less than 80 per cent) this year against Rs 50,000 per annum till last year. In case of severe disability (more than 80 per cent), you can claim Rs 1.25 lakh per annum instead of Rs 1 lakh per annum earlier, irrespective of the amount you incurred during the financial year. While claiming the deductions you will have to furnish a certificate from medical authorities.

4. Also, the deduction limit under Section 80DDB for expenditure incurred on specific diseases such as Dementia, malignanat cancers, AIDS and chronic renal failure has been increased to Rs 80,000 per annum from Rs 60,000 per annum in case of very senior citizen. You can claim up to Rs 80,000 or the amount actually spent whichever is lower.

5. In case of a person with disability, the deduction limit under Section 80U has been increased to Rs 75,000 for this year against the earlier limit of Rs 50,000. In case of severe disability the limit has been increased to Rs 1.25 lakh from earlier limit of Rs 1 lakh. This is applicable where the tax payer himself suffers from a disability.

6. You can claim a deduction of up to Rs 1,600 per month towards transport allowance provided by your employer to you. Till last year the limit was Rs 800 per month. Also, if the person is blind or orthopedically handicapped with disability of lower extremities, he or she can claim a deduction of up to Rs 3,200 per month against earlier limit of 16,00 per month.

Source:BankingNews