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INTAS PHARMACEUTICALS LTD.
CIRCULAR - F.Y.2015-16
TAX SCHEDULE:
1.For resident individual(who is of the age of below 60 years at any time duringthe previous
year)the basic exemption limit of income is Rs.2,50,000/-for the current year.
TOTAL INCOME
RATE OF TAX
Up to Rs. 2,50,000/-
NIL
Between Rs.2,50,001/-to
Rs.5,00,000/-
10% of income above Rs. 2,50,000/- + 2% Education Cess +
1% Secondary and Higher Education Cess
Between Rs.5,00,001/-to
Rs.10,00,000/-
Less: Tax Relief - 10% of taxable income or Rs. 2,000/whichever is lower.
Rs.25,000 + 20% of income above Rs.5,00,000+2% Education
Cess + 1% Secondary and Higher Education Cess
Above Rs.10,00,000/-
Rs.1,25,000 + 30% of income above Rs.10,00,000+2%
Education Cess + 1% Secondary and Higher Education Cess
Note : 12 % surcharge is applicable on total income
exceeding Rs. 1 Crore.
2.For resident senior citizen (whois of the age of 60 years or moreatany time during the
previousyear) the basic exemption limit of income is Rs. 3,00,000/- for the current year
TOTAL INCOME
RATE OF TAX
Up to Rs. 3,00,000/-
NIL
Between Rs.3,00,001/-to
Rs.5,00,000/-
10% ofincome above Rs. 3,00,000/- + 2% Education Cess +
1% Secondary and Higher Education Cess
Between Rs.5,00,001/-to
Rs.10,00,000/-
Less: Tax Relief - 10% of taxable income or Rs. 2,000/whichever is lower.
Rs.20,000 + 20% of income above Rs.5,00,000 + 2%
Education Cess + 1% Secondary and Higher Education Cess
Above Rs.10,00,000/-
Rs.1,20,000 + 30% of income above Rs.10,00,000 + 2%
Education Cess + 1% Secondary and Higher Education Cess.
Note: 12 % surcharge is applicable on total income
exceeding Rs. 1 Crore.
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3. Interest paid in respect of Self Occupied House Property: [Investment Plan Head:- 584]
As per the amended 2nd proviso to section 24(b), interest payable on borrowed capital
in respect of Self Occupied (S.O.) House Property is deductible up to a maximum of Rs.
2,00,000/-. The S.O. House Property should have been acquired or constructed with capital
borrowed on or after01-04-1999 and the acquisition or construction of the said house property
should be completed within three years from the end of the financial year in which capital
was borrowed.
Further 1/5 of Pre-EMI interest i.e. Interest charged by the lender before starting of EMI
accumulated, shall be considered in the total deductible maximum amount of Rs. 2,00,000/-.
In other words Pre-EMI interest is deductible in 5 equal installments starting from the year in
which construction of house is completed/possession taken i.e. month of starting of EMI. The
lenders always give certificate for both Pre-EMI and EMI interest.
Further employee who has availed housing loan for purchase/construction of residential
property has to compulsorily submit provisional certificate for principal and interest
paid/payable for the period from 01.04.2015 to 31.03.2016 from bank or financial
institution on or before 31.01.2016. In no case certificate dated before December, 2015
shall be accepted.
4.Exemptions from Salary Income:
(a) Leave Travel Concession [ Section 10(5) read with Rule 2B ] :
WHO?
Any employee is eligible to claim an exemption from Income Taxon receipt of LTC for
himself/ herself and his/her spouse, children-dependent or independent, minor or major as well as dependent parents, brothers and sisters. However, in respect of children born
on or after 1.10.1998, the exemption will be restricted only to two surviving children
unless the birth after one child has resulted in multiple births.
WHERE?
Exemption is available for travel to any place in the country and is not restricted to
home-district travel.
WHEN?
An exemption from Income Tax in respect of receipt of LTC is available in respect of two
journeys performed in a block of Four calendar years. The current block is the period
starting from January 1, 2014 till December 31, 2017.
Salary is taxable on receipt basis or on due basis, whichever happens earlier. LTC for
current year would become due on 31.03.2016.If it is not claimed by them, tax would be
payable in respect thereof and would be deducted from the payment of LTC. Under no
circumstances LTC of one year can be carried over to the next year so as to avail of the
exemption with respect to combined LTCs of both years.
HOW MUCH?
If the journey is performed by air, it is the economy class airfare of the national
carrier by the shortest route to the place of destination.
If the journey is performed by rail, it is the air-conditioned first class railway fare by the
shortest route to the place of destination.
If the journey is performed by any other mode to a place connected by rail, it is an
amount actually spent but not exceeding the air-conditioned first class railway fare by
the shortest route.
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If the journey is performed by a mode of public transport to a place not connected by
rail, it is the amount actually spent but not exceeding first class or deluxe class fare
for that mode of transport by the shortest route.
If the journey is performed by any mode to a place not connected by rail or public
transport, it is the air-conditioned first class railway fare for an equivalent distance or
amount actually spent whichever is less.
Moreover, the tax exemption cannot, under any circumstances, exceed the amount
actually incurred for the travel fare. To avail the benefit, one must proceed on leave.
One must furnish details of actual expenditure incurred along with original
supporting to personnel department at HO in the prescribed format.
(b)House Rent Allowance [Section 10(13A) read with Rule 2A ] : [Investment Plan
Head:- 581]
On the basis of house rent paid, amount of HRA received is exempt from income tax in
whole or in part, as per the prescribed rules. For this purpose, original receipt of house
rent(only for one month) must be sent to us along with declaration form. Declaration form
is enclosed. (An employee living in his own house or in a house for which he/she
does not pay any rent is not eligible for this exemption.)
The least of the following is exempt from tax:
1) 40% of basic salary (50% for Mumbai, Kolkata, Delhi and Chennai).
2) HRA for the period the house is occupied by the employee.
3) The excess of rent paid over 10% of basic salary.
Further it is important to note that if annual rent paid by the employee exceeds Rs
1,00,000 per annum, it is mandatory for the employee to report PAN of the landlord
to the employer. In case the landlord does not have a PAN, a declaration to this
effect from the landlord along with the name and address of the landlord should
be filed by the employee
(c) Children Education Allowance
Under Sec. 10(14) read with Rule 2BB(2)(5) Children Education Allowance (C.E.A.) is
exempt from income tax up to Rs.100/- per month per child up to maximum of two
children. For claiming exemption of C.E.A., Company’s prescribed form should be filled
in and submitted as stated in the attached Declaration Form together with the proofs as
and when the payments are made.
(d) Children Hostel Allowance
Under Sec. 10(14) read with Rule 2BB(2)(5) Children Hostel Allowance is exempt from
income tax up to Rs.300/- per month per child up to a maximum of two children. For
claiming exemption of C.H.A., Company’s prescribed form should be filled in and
submitted as stated in the attached Declaration Form
5. DEDUCTIONS FROM GROSS TOTAL INCOME
Deduction U/s 80CCC in respect of contribution to specified Pension Funds: [Investment
Plan Head:- 586]
As per the proposed amendment of section 80 CCC (1) in Finance Bill,2015,the ceiling limit of
deduction is raised from Rs.1,00,000 to Rs.1,50,000 within overall ceiling limit of Rs.1,50,000
u/s 80CCE. This amendment is effective from 1st April, 2015 i.e. effective for FY 2015-16.
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Deduction U/s 80CCD in respect of contribution to National Pension Scheme (“NPS”)
notified by Central Government:[Investment Plan Head:- 586]
As per the proposed amendment of section 80 CCD (1) in Finance Bill,2015,the ceiling limit of
deduction is raised from Rs.1,00,000 to Rs.1,50,000 within overall ceiling limit of Rs.1,50,000
u/s 80CCE
Further as per the proposed insertion of new sub section (1B) to section 80 CCD in Finance
Bill,2015
an additional deduction of Rs. 50,000/- is given for contribution to National
Pension Scheme (“NPS”) which is expected to be notified by Central Government over
and above limit of Rs.1,50,000 prescribed u/s 80 CCE. In other words additional deduction
of Rs. 50,000 shall be available u/s 80CCD effective from 1st April, 2015 i.e. effective for FY
2015-16.
Deduction U/s 80CCG in respect
(RGESS)[Investment Plan Head:- 585]
of
Rajiv
Gandhi
Equity
Savings
Scheme
The Finance Bill 2013-14 proposed liberalisation of the Rajiv Gandhi Equity Savings
Scheme(RGESS) that was launched in FY 2012-13. The first time investors will now be allowed
to invest in mutual funds as well as listed shares. This investment can be done not in one year
alone, but in three successive years. While presenting the Union Budget in the Lok Sabha on
28.02.2013, the Finance Minister Shri P.Chidambaram said that the income limit is also being
proposed to be raised from Rs.10 lakh to Rs.12 lakh.
The existing provisions of section 80CCG, inter-alia, provide that a resident individual who has
acquired listed equity shares in accordance with the scheme notified by the Central Government,
shall be allowed a deduction of fifty per cent of the amount invested in such equity shares to
the extent that the said deduction does not exceed twenty five thousand rupees. The
deduction is a one-time deduction and is available only in one assessment year in respect of the
amount so invested. The deduction is available to a new retail investor whose gross total income
does not exceed ten lakh rupees. Rajiv Gandhi Equity Savings Scheme has been notified under
section 80 CCG.
With a view to liberalize the incentive available for investment in capital markets by the new retail
investors, it is proposed to amend the provisions of section 80CCG so as to provide that
investment in listed units of an equity oriented fund shall also be eligible for deduction in
accordance with the provisions of section 80CCG. It is proposed to provide that “equity oriented
fund” shall have the meaning assigned to it in clause (38) of section 10.
It is further proposed to provide that the deduction under this section shall be allowed for three
consecutive assessment years, beginning with the assessment year relevant to the previous
year in which the listed equity shares or listed units were first acquired by the new retail investor
whose gross total income for the relevant assessment year does not exceed twelve lakh rupees.
Maximum deduction of Rs. 25,000/- shall be allowed to the First Time Investor on case to
case basis, subject to fulfillment of condition prescribed in section 80CCG as amended in
Finance Bill, 2013.
Deduction U/s 80D in respect of Medical Insurance Premium:[Investment Plan Head:- 585]
As per the proposed amendment of section 80 D in Finance Bill,2015, the ceiling limit of
deduction is raised from Rs. 15,000/-to Rs. 25,000/-(and from Rs. 20,000/- to Rs. 30,000/-for
senior citizens) per annum is available to the extent Mediclaim insurance premium is paid by you
by cheque. Mediclaim policy is taken on the health of employee, spouse, and dependent
children. Additional deduction of Rs. 25,000/-(Rs. 30,000/- for senior citizens)for premium paid
by the employee on Mediclaim insurance of Parents of the employee is available. Parents need
not be dependent on the Employee.
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Further it also include any payment made by any mode including cash by an individual on
account of preventive health-check up of self, spouse, dependent children or parent(s) during
the previous year 2015-16 not exceeding Rs. 5,000/- as eligible for deduction within the overall
limit of Rs.25,000/- under section 80D for self spouse, and dependent children + additional limit
of Rs. 25,000/- for parents .
Kindly note that this is not an additional deduction u/s 80D.
Further it is also proposed in Finance Bill, 2015 that any payment made on account of medical
expenditure in respect of person who is of the age of 80 years or more(Very Senior Citizen)
deduction not exceeding Rs.30,000/- shall be allowed u/s 80D.
The maximum permissible deduction u/s 80D is tabulated hereunder for quick understanding:
Sr.No.
1
2
3
4
Scenario
Self, Spouse &
Dependent
Children(Family)
Total deduction
Rs. 25,000/Rs. 25,000/-
Parents
(whether
dependent or
not)
Rs. 25,000/Rs. 30,000/-
No one is above 60 years
No one in family is above 60
years & either one of
parents are above 60 years
At least one member of
family is above 60 years
and either one of the
parents are above 60 years
Medical Expenditure (where
at least one member is
above the age of 80 years
without
any
health
insurance
Rs. 30,000/-
Rs. 30,000/-
Rs. 60,000/-
Rs. 30,000/-
Rs. 30,000/-
Rs. 60,000/-
Rs. 50,000/Rs. 55,000/-
In Finance Bill, 2015 it is proposed to raise the limit of deduction u/s 80DD and 80U as
stated below:
80DD(Deduction for expenditure incurred for medical treatment of disable dependent or
premium paid to Insurance Co. in respect of scheme for maintenance of a disabled
dependent) :- From existing limit of Rs. 50,000/- to Rs.75,000/ for disabled and from
existing limit of Rs. 1,00,000/- to Rs. 1,25,000/- for severely disabled-.
80U (Deduction to a person who at any time during the previous year, is certified by the
medical authority to be a person with disability):- From existing limit of Rs. 50,000/- to
Rs.75,000/ for disabled and from existing limit of Rs. 1,00,000/- to Rs. 1,25,000/- for
severely disabled-.
Kindly note that deduction u/s 80DD and 80U shall be allowed on case to case basis
depending on facts of the case and compliance of law provisions.
Specified savings qualifying for deduction from Gross Total Income U/s 80C[Investment
Plan Head:- 586]
Eligible investments:
a) Contributions made to a Statutory Provident Fund and Recognized Provident Fund.
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b) Life Insurance Premium for self, spouse & children subject to a maximum of 20% of sum
assured for policies taken on or before 31.03.2012/10% of sum assured for policies
taken on or after 01.04.2012.
c) National Savings Certificate – VIII Issue (along with accrued interest which is deemed as
reinvested) for self only.
d) 15 year Public Provident Fund A/c. (PPF) with Banks/Post Office for self, spouse & any
child.(Limit of Rs.1,00,000/- is raised to Rs. 1,50,000/-)
e) Unit Linked insurance Plan (ULIP) for self, spouse & children.
f)
Any payment towards the cost of purchase / construction of a residential property
(including repayment of loan) for self.
g) NSS, Jivan Dhara/ Jivan Akshay Policy Premium for self.
h) Contribution to notified pension fund set up by Mutual Funds or U.T.I. for self.
i)
Any sum paid as tuition fees (not including any payment towards development
fees/donation/Transport charges/hostel charges/Mess charges/Library fees/Scooter-CycleCar Stand charges/Late fees/payment of similar nature and private tuition fees)whether at the
time of admission or otherwise to any University /College / Educational institution in India for
full time education of any two child of the individual.
j)
Any amount of Time deposit / fixed deposit of not less than 5 years with a Post office/
scheduled bank within overall ceiling limit in the first name of employee.
k) Pursuant to the Budget announcement in July,2014, a special small savings instrument for
the welfare of girl child was introduced under Sukanya Samriddhi Account Rules,2014
envisaging following tax benefits:
1. The investments made in the Scheme will be eligible for deduction u/s 80C.
2. The interest accruing on deposits in such account will be exempt from income tax u/s
10(11A) of I.Tax Act,1961.
3. The withdrawal from the said scheme in accordance with the rules of the said scheme will
be exempt from income tax u/s 10(11A) of I.Tax Act,1961.
With a view to allow deduction u/s 80C to the parent or legal guardian of the girl
child, amendment of section 80C of the Income Tax Act, 1961 is proposed to be
made so as to provide that a sum paid or deposited during the year in the Scheme
in the name of any girl child of the individual or by her legal guardian, would be
eligible for deduction in Finance Bill,2015.
This amendment will take effect retrospectively from 1st April, 2015 and will
accordingly apply in relation to Assessment Year 2015-16 and subsequent
Assessment Years.
Aggregate amount of deduction u/s 80C, 80CCC & 80CCD not to exceed Rs.2,00,000/-.
ELIGIBILITY U/S 80C REGARDING NEWLY CONSTRUCTED HOUSE PROPERTY:
The following payments/repayments/expenditure are eligible for deduction.
1. The payment for purchase or construction of Residential Property under any self-financing
or other scheme of development authority / housing board or any other similar authority / or
to any Company / Co-operative society of which you are a shareholder / member.
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2. Repayment of loan borrowed from: (a) Government or
(b) Any Bank or LIC or
(c) Employer being a public company or
(d) Any Institution providing long term finance like LIC, HDFC, National Housing Bank, etc.
for construction or purchase of residential houses in India.
3. (A) Stamp Duty, Registration Fees & Other Expenses for the transfer of House Property
is also covered.
(B) However, admission fee or cost of share or initial deposit or cost of addition
/alteration/renovation/repair incurred, after the house is occupied / let out or any interest
payment on borrowed money are not to be included.
Proof of completion of construction of house must be sent invariably for getting the
income-tax benefit for the first time.
Withdrawal of Deduction:
If the house, for which deduction has been allowed in earlier previous year(s), is transferred
before the expiry of 5 years from the end of financial year in which possession of such property
is obtained, the aggregate amount of the deductions of income-tax so allowed in earlier years
shall be deemed to be tax payable by the assessee and shall be added to the tax on the total
income of year of transfer.
Please note that the deduction for donations to certain funds, charitable institutions (Sec
80G) would not be considered by the Company. The same would have to be claimed by
the employee in his/her Tax Return.
Important Note:
Finance (No.2) Bill, 2009 has inserted section 206AA in the Income tax Act, 1961 with effect from
1st April,2010 for strengthening the PAN mechanism.
The provisions of section 206AA are given below:
1. Every person whose receipts are subject to deduction of tax at source (i.e. the deductee)
shall furnish PAN to the deductor. It will be compulsory from 1st April,2010.
2. If such person does not furnish PAN to the deductor, the deductor will deduct tax at
source at higher of the following rates :
The rate prescribed in the Act;
The rate in force i.e. the rate mentioned in the Finance Act;
At the rate of 20%
In view of the para 2 above, it is compulsory for employer to deduct tax at source at
higher rate of 20% even if employee is falling under first slab of 10% and that to without
deducting threshold exemption limit of Rs. 2,50,000/-.
Kindly note that if valid PAN is not provided to employer or entered in the SAP system, tax
at the higher rate of 20% shall be calculated& deducted from the first month’s salary i.e.
April,2015 salary/1st month salary of new joiner by the SAP system without giving any
further intimation to the employee.
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Important Amendment effective from 1st June, 2015:
In Finance Bill,2015, it is proposed to insert sub-section (2D) in section 192 (Provisions for
deduction of tax from the Salaries of Employees by Employer(INTAS)) to provide that the person
responsible for making payment referred to in sub-section (1) of section 192 i.e. INTAS shall for
the purposes of estimating income of the assessee (Employees) of computing tax deductible
sub-section (1) of section 192 therein ”obtain from assessee (Employees) the evidence or proof
or particular of prescribed claims(including claim for set off of loss under the head income from
house property) under the provisions of the Income Tax Act,1961 in such form and
manner as may be prescribed.
Once form and manner of obtaining from assessee (Employees) the
evidence or proof or particular of prescribed claims(including claim for set
off of loss under the head income from house property) is prescribed, we
will put the same in intraweb/ffr and employee have to fill up the same and
send the same to Direct Taxes Department.
With Regards,
ShyamsunderAjmera/Sanju Kanojiya
Direct Taxes Department
(HO- Phone No.(D):- 079-66523183/079-66523488)
E-mail ID: ssajmera@intaspharma.com
Sanju_kanojiya@intaspharma.com
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