Mr Arun Jaitley,The Finance Minister of India Presented his first full fledged budget today (28 Feb 2015). There were huge expectations from tax payers from the budget like increase in tax exemption slabs, Higher deductions on interest for housing loans etc., But the Finance Minister has chosen not to alter tax slabs during the budget. Although he hinted about the possibility of revision of tax slabs, it may not be before next budget.
So this Income Tax Calculator which is for Financial Year 2015-16 (FY 15-16) is made with little modification from the previous years Income Tax Calculator . The major changes proposed in the budget are also incorporate in the calculator for Financial Year 2015-16 and Assessment Year 2016-17 as per the Central Finance Budget 2015-16.
Major proposals in the union budget for Individual tax payers which are also included in the above income tax calculator for the assessment year 2016-17. The exemptions and deductions will be applicable if the investments / deductions are from 01 Apr 2015 to 31 Mar 2016.
There are no changes in the tax slabs. Previous tax slabs will remain same.
In spite of huge expectations from individual tax payers for increase in the limit of 80C from existing 1.5 Lakhs to atleast 2 lakhs, No increase is made. It must be appreciated that this limit is already increased in his last interim budget. But there is more thought out deduction announced in the budget which is deduction of Rs 50,000 if invested in New Pension Scheme or NPS. It almost works similar to exemption of 80C but can not be clubbed with other investments like PPF, Insurance Premium, ELSS Mutual Funds or even bank FD. This is a sort of making people having disciplined investment for their pension scheme which is in fact a good move. It augurs well for both Investors by rewarding them well in their golden years with pension and making investments available for the Nation.
Similarly, Health Insurance premium is increased from earlier 15000 rupees to 25000 and the same is increased from 20,000 to 30,000 in case of senior citizens. This will augur well for the people who wish to take complete health plan and paying premiums more than 15000 per annum.
For senior citizen who are above 80 years thus not eligible for health insurance, Rs 30,000 deduction is allowed for medical expenditure. Deduction limit of Rs 60,000 on expenditure of specified diseases is enhanced to Rs 80,000 in the case of senior citizens.
Similarly Investments in Sukanya Samriddhi Scheme are eligible for deduction under section 80C of the income-tax and any both principal and interest will be exempted from tax.
The other concession provided during the union budget, which can also be entered in the income tax calculator is transport allowance. For salaried people, the exemption limit in case of transport allowance is increased from earlier 800 rupees to 1600 rupees per month.
The Tax Rebate Rs.2000/- U/s 87A will be continue in the FY 2015-16 and Rs.10,000/- can be get relief from tax U/s 80TTA from Savings Bank Interest.