Yash. (Final CA Student) (76 Points)
20 September 2013Helloo !!
My query is:
Whether Contributions made to PPF out of 'Income NOT chargeable to tax' would be eligible for Deductions u/s 80C ?
I did not find any provision in Sec 80C which states that the deductions can be claimed only if the Contribution/Payments is made out of 'income chargeable to tax'.
Thank you in Advance ! :)
CA. Kunal Lakhotia
(ACA)
(1006 Points)
Replied 20 September 2013
How you know that contribution is made out of non taxable income? If you want to claim deduction then you must be having taxable income
Yash.
(Final CA Student)
(76 Points)
Replied 20 September 2013
Suppose if Mr.A have exempt income of Rs. 50,000 in Cash and also taxable income of Rs. 3,00,000 which is credited in the Bank. Then whether Mr.A can claim Deduction of Rs. 50,000 from the taxable income of Rs. 3,00,000 by depositing the same amount (Rs. 50,000) in PPF a/c.
CA. Kunal Lakhotia
(ACA)
(1006 Points)
Replied 20 September 2013
Yes practically you can as in ITR you do not disclose cash income or otherwise, and very rare chance that I-T deptt will question this deduction
Manvi Mehrotra
(Associate Tax Consultant)
(88 Points)
Replied 20 September 2013
There is no point in your return where you show that from what source of income are you investing in PPf.
Practically, you invest from the taxable income only.
So, you can claim the deduction of amount invested in PPF upto a maximum limit of Rs. 100000
Neha sharma
(-)
(1257 Points)
Replied 20 September 2013
Yash.
(Final CA Student)
(76 Points)
Replied 22 September 2013
So it seems the Assessee can claim the deduction irrespective of the source of income from which the contribution to PPF is made....and so even if the assessee deposit any amount in his PPF a/c from his Daughter's / Son's income ...the deduction can be claimed ... Right ?
CA Rajesh K
(CA in Practice)
(32 Points)
Replied 23 September 2013
satish kumar Chauhan
(accountant)
(347 Points)
Replied 24 September 2013
if the assesee deposit any amount in his PPF a/c from his Daughter's / Son's income ...the deduction can not be claimed. Only contributions in the tax saving scheme u/s 80 C up to Rs. 1.00 lac in his/children/spouse name out of assesee income which is taxable or exempt is eligible for deduction
The Dude
(Specialist- Finance)
(303 Points)
Replied 12 November 2013
Deduction can be claimed upto Rs 1 Lakh without doubt.
Himanshu Gupta
(Article)
(63 Points)
Replied 12 November 2013
The Deduction can be claimed, as your AO has no chance of knowing whether you have paid it from Exempt income or Taxable income. And anyways, you did declare your Exempt Income.
P.S.- It is my pure assumption that the income is exempt rather than being undeclared, as it will be wrong in my part to assume the latter...!!
satish kumar Chauhan
(accountant)
(347 Points)
Replied 13 November 2013
It is very simple and understood that deduction u/s 80C is eligible if invest any saving scheme out of assese income source, which is exmept or taxable income or source of fund i.e loan, gift etc.
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