Ramkrishna (Accountant) (325 Points)
17 March 2008HELLO
MY FREIND WORKS IN A COMPANY, INSTEAD OF SALARY HE TAKES PROFESSIONAL FEES BY ISSUING INVOCIE TO COPMANY. RS. 10,000.00 IS GIVEN EVERY MONTH AS BILL, THE EMPLOYER DULY CUT TDS AND DEPOSIT. HE HAS ONLY THIS MUCH OF INCOME DURING THE YEAR.
NOW THE QUESTION IS THAT TDS IS DEDUCTED AT 10.2%-10.33%, MEANS ABOUT 12000-13000 RS. OF HIS RECEIPT IS TAXED. HOW CAN HE SAVE THIS MONEY. IS THERE EXEMPTION FROM THE TAXATION TO SUCH INDIVIDUAL....
PLZ REPLY AT BEST.
THANKS
Shefali Bajpai
(Article Assitant & CA Final Student)
(1148 Points)
Replied 18 March 2008
In order to save tax deduction can be availed under the following Sections:
1. Sec 80 C (maximum to Rs. 1 lakh including Sec 80 CCC).
2. Sec 80 D (in AY 2008-09 maximum to Rs. Rs. 15000 ; Rs. 20000 if any dependant family member a senior citizen.)
3. Sec 80 GG - Deduction in respect of rent paid by self employed person. However, deduction u/s 80 GG is denied:
a. Where the tax payer, his spouce or minor child or the HUF of which he is a member, owns a residential accomodation at the place where the tax payer resides and carries on his business or profession.
b. Where the taxpayer owns any residential accomodation at any other place and the concession in respect of self occupied property u/s 23(a) or 23( 4)(a) is claimed by him in respect of such accomodation.
Amount of Deduction : is the least of the following:
a. Rs. 2,000 p.m.
b. 25 % of total income (total income is calculated after excluding long-term capital Gain, short term capital gain u/s 111A, & income referred to in sec 115A or 115D and amount deductible u/s 80C to 80U but before making any deduction under this section.)
c. the excess of actual rent over 10% of total income (total income as defined in point b.)
He should also file a declaration in Form 10BA regarding the expenditure incurred by him towards payment of rent.
I hope I have been able to address your querry to certain extent.
Regards,
Shefali.
CA. Amit Daga
(Finance Controller CA. CS. CFA. CIFRS. M.COM. )
(9017 Points)
Replied 18 March 2008
Ramakrishna,he is not required to pay any tax..just need to make a adjustment of Rs.10000.which he can make it from telephone bill,medical bill,hra etc...
Shefali his total income is just Rs.12000.and he dont have any other income so he is not required to for this
shibi
(consultant)
(25 Points)
Replied 18 March 2008
Even I have the same query as above I am working for a software company and I raise invoice at the month end the TDS is cut and iget only 13000p.a in hand please let me know how can i get more in hand?
Shefali Bajpai
(Article Assitant & CA Final Student)
(1148 Points)
Replied 18 March 2008
Ramkrishna
(Accountant)
(325 Points)
Replied 19 March 2008
Miss shefali, you were right at first...i mean to say my monthly receipt is 10000 rs. i.e annually 1.20 lacs and tds for whole amount to be between 12000-13000. Any way thanks both of you for the help, i had a little hope of getting save those money. if any other suggestion please fel free to say.
regards
CA. GOPAL SONIKA
(CHARTERED ACCOUNTANT)
(1426 Points)
Replied 19 March 2008
if 10000/- p.m is given as retainer fees, then the total comes to Rs.1.2 lacs p.a. If we assume that income is for FYear 2007-08, then his tax liability would be Rs.1000/- only assuming he has nil investment.
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