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February 20, 2009 12:24 IST
It's that time of the year again. Time to get ready with your investments and taxes. Were you prudent with your investments last year? Did they help you save tax? Or did you end up paying more than you could afford?
What investment mistakes did you make last year? Are there ways to rectify them? What investment options should you go for this year?
What should you do to bring your tax liability to the minimum level?
Direct tax expert Vikas M Gandhi offered some vaulable tax-saving tips during a live chat on rediff.com on Thursday. Here is the transcript:
Vikas Gandhi says, Good evening friends and welcome back to the tax chat session
vijaybabu asked, Hi Vikas, My wife and I work for the same organization, we stay in a rented flat (rent Rs. 12k) Can both of us induvidually claim the HRA for 12 K each or should that be shared (6k + 6k), Assuming the allowed HRA for our package is 12K per month. Please advice.
Vikas Gandhi answers, at 2009-02-19 15:53:42Both of you cannot individually claim rent of Rs.12,000/-. If you are sharing the rent, you can claim benefit only for your share of rent paid.
vikas asked, hi Vikas, i want to buy an residential plot ,can i get tax rebate on loan repayment
Vikas Gandhi answers, Loan taken for purchase of a Vacant plot of land, whether residential or commercial, does not enjoy any tax benefit.
taxguru asked, Hi Vikas, During the FY'09 i was not working from Apr~Aug.Can i get any tax exemption (say HRA etc)as i was staying in a rented acc. ? Can i claim LTA for that period when i was not working ?
Vikas Gandhi answers, You can claim the benefit of HRA only for the period for which you have received HRA from your employer. Since you were not employed from Apr-Aug, you cannot claim HRA benefit. However for this period, you can claim tax benefit u/s 80GG for the amount of rent paid.
harrypotter_27@rediffmail.com asked, Hello Vikas, for claming HRA is necessary to give rent agreement or Rent receipt will be sufficent
Vikas Gandhi answers, For an employer to give the HRA benefit, while deducting tax from salary, rent receipt is sufficient. However your Income Tax Officer may insist for Rent agreement, if s/he doubts the genuinity of rent receipts or payment made.
Vats asked, I have taken a medical insurance for 6732 Rs. Does it come under Section 80C or 80 D? & also The Medical Reimbursement upto 15000 Comes under Section 80C or 80D? Please clarify?
Vikas Gandhi answers, Tax benefit for payment of medical insurance premium is covered by section 80D. As far as reimbursement of Rs.15,000/-, is concerned, it is neither covered under sec 80C nor 80D. It forms part of your salary and if the medical bills are provided to the employer, the same gets exempted from tax.
Parvez asked, Hi, I am living in rented house in Jogeshwari (Mumbai District) and pay Rs. 6500/- as rent and my father is staying in the house at Mira Road (Thane Dist) for which i have availed housing loan. He pays rent of Rs. 3000/- to me for that flat. So can i get tax benefit on loan and HRA also? My basic salary is 57433/-
Vikas Gandhi answers, Since you have rented out your property, in my opinion, you will be able to claim both the tax benefit of HRA as well as home loan.
rajan asked, Dear Vikas..can I include the amount deposited by me for my wife's PPF account in 80 C, in my return?
Vikas Gandhi answers, Amount deposited by you in the PPF account of your spouse and children can be claimed as tax benefit under sec 80C.
vkg asked, Do we need to add DA to our BP to cal. salary while cal. HRA exemption.
Vikas Gandhi answers, Yes, if the Dearness Allowance is forming part of your retirement benefits, you have to add the same to your Basic Pay, while calculating HRA exemption.
binex asked, Hi vikas, I have 2 hosuing loans, i read somewhere that the principal paid only on one of the loans would be considered ... cant I claim principal repayment of both loans under 80C .. pl clear my doubt
Vikas Gandhi answers, As per my knowledge, there is no such limit mentioned in the Income Tax law. You can take n number of loan for purchase of a house and claim tax benefit on the same, within the limit specified by the law.
vaishnavi asked, I am staying in rented flat of my relatiive. we have not made any agreement and also not paid any deposit. But we pay rent of Rs. 10,000/- to him. I have taken rent receipts from my relative to claim the HRA exemption. Is this proof enough for claiming HRA exemption.
Vikas Gandhi answers, Certainly rent receipt will be a sufficient proof for claiming HRA benefit. However take care to see that you pay the rent thru cheque and that your relative is having a proper PAN and that s/he has shown the rent amount as income in the income tax return filed with the Department.
Hem asked, Tell me regarding uniform allowance. Whether, it is taxable or exempt.
Vikas Gandhi answers, Uniform Allowance is exempt to the extent it is actually spent for purchase of uniform.
hardeep asked, if the house i am renting is in dual name say A and B can i pay rent to A for first 6 months and B for next six months in a year such that each of them receives rent less than 1,10,000 and I do not have to deduct tax at source for either of them(since rent payment is less than 1,10,000 to each of them) Regards
Vikas Gandhi answers, I presume that you are paying rent in your individual capacity and if so, you are not required to deduct any tax on the rent you pay to the landlord, even though it exceeds the prescribed limit. The limit is applicable to those individual who are required to get their books audited under Income Tax law. In any case the above payment method mentioned, will not allow you to escape from the tax deduction liability.
Vikas Gandhi says, That's the end of today's session. Chat with you in next session. Till then Good-bye.
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