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Income Tax Exemptions FY 2017-18 : List of important IT
Deductions for AY 2018-19
Last updated: April 11, 2017 | by Sreekanth Reddy 85 Comments

Budget 2017-18 & the Finance Bill 2017 have been tabled in Parliament. The income tax rate for

those earning between Rs 2.5 lakh and Rs 5 lakh has been halved to 5%. Except this change, all

other Income Tax Slab rates have been kept unchanged by the Finance Minister for the

Financial Year 2017-18(Assessment Year 2018-2019) .

Tax planning is an important part of a nancial plan. Whether you are a salaried individual, a

professional or a businessman, you can save taxes to certain extent through proper tax
planning.

The Indian Income Tax act allows for certain Tax Deductions / Tax Exemptions which can be

claimed to save tax. You can subtract tax deductions from your Gross Income and your taxable

income gets reduced to that extent.

Let us understand all the important sections and new proposals with respect to Income Tax

Exemptions FY 2017-18. I hope you nd this list useful and helps in planning your taxes well in

advance.

List of Income Tax Exemptions FY 2017-18 / AY 2018-19 (Chapter VI-


A deductions list)

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Section 80c

The maximum tax exemption limit under Section 80C has been retained as Rs 1.5 Lakh only.

The various investment avenues or expenses that can be claimed as tax deductions under

section 80c are as below;

PPF (Public Provident Fund)

EPF (Employees Provident Fund)

Five year Bank or Post ofce Tax saving Deposits

NSC (National Savings Certicates)

ELSS Mutual Funds (Equity Linked Saving Schemes)

Kids Tuition Fees

SCSS (Post ofce Senior Citizen Savings Scheme)

Principal repayment of Home Loan

NPS (National Pension System)

Life Insurance Premium (Read : Best Term insurance plans)

Sukanya Samriddhi Account Deposit Scheme

(Read : Tax Saving Investment Options u/s 80c | In whose name can they be Invested?)

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GAPMEN'SSHORTSLEEVEGAPCROPLOGOTEE
Rs.1,499.00 (details+delivery)

Section 80CCC

Contribution to annuity plan of LIC (Life Insurance Corporation of India) or any other Life

Insurance Company for receiving pension from the fund is considered for tax benet. The

maximum allowable Tax deduction under this section is Rs 1.5 Lakh.

Section 80CCD

Employee can contribute to Government notied Pension Schemes (like National Pension

Scheme NPS). The contributions can be upto 10% of the salary (salaried individuals) and Rs
50,000 additional tax benet u/s 80CCD (1b) was proposed in Budget 2015.

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As per Budget 2017-18, the self-employed (individual other than the salaried class) can now

contribute up to 20% of their gross income and the samecan be deducted from the taxable

income under Section 80CCD (1) of the Income Tax Act, 1961, as against current 10%.

To claim this deduction, the employee has to contribute to Govt recognized Pension schemes

like NPS. The 10% of salary limit is applicable for salaried individuals only and Gross income is

applicable for non-salaried. The denition of Salary is only Dearness Allowance. If your

employer also contributes to Pension Scheme, the whole contribution amount (10% of salary)
can be claimed as tax deduction under Section 80CCD (2).

Kindly note that theTotal Deduction under section 80C, 80CCC and 80CCD(1) together cannot

exceed Rs 1,50,000 for the nancial year 2016-17. The additional tax deduction of Rs 50,000

u/s 80CCD (1b) is over and above this Rs 1.5 Lakh limit.

(Read : NPS Scheme Pros & Cons)

Contributions to Atal Pension Yojana are eligible for Tax Deduction under section 80CCD.

Section 80D

Deduction u/s 80D on health insurance premium isRs 25,000. For Senior Citizens it is Rs

30,000. For very senior citizen above the age of 80 years who are not eligible to take health

insurance, deduction is allowed for Rs 30,000 toward medical expenditure.

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Preventive health checkup (Medical checkups) expenses to the extent of Rs 5,000/- per family
can be claimed as tax deductions. Remember, this is not over and above the individual limits as

explained above. (Family includes: Self, spouse, dependent children and parents).

Section 80DD

You can claim up to Rs 75,000 for spending on medical treatments of your dependents

(spouse, parents, kids or siblings) who have 40% disability. The tax deduction limit of upto Rs
1.25 lakh in case of severe disability can be availed.

To claim this deduction, you have to submit Form no 10-IA.

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Section 80DDB

An individual (less than 60 years of age) can claim upto Rs 40,000 for the treatment of
161 specied critical ailments. This can also be claimed on behalf of the dependents. The tax

deduction limit under this section for Senior Citizens is Rs 60,000 and for very Senior Citizens

(above 80 years) the limit is Rs 80,000.

To claim Tax deductions under Section 80DDB, it is mandatory for an individual to obtain

Doctor Certicate or Prescription from a specialist working in a Govt or Private hospital.

For the purposes of section 80DDB, the following shall be the eligible diseases or ailments:

Neurological Diseases where the disability level has been certied to be of 40% and

above;

(a) Dementia

(b) Dystonia Musculorum Deformans

(c) Motor Neuron Disease

(d) Ataxia

(e) Chorea

(f) Hemiballismus

(g) Aphasia

(h) Parkinsons Disease

Malignant Cancers

Full Blown Acquired Immuno-Deciency Syndrome (AIDS) ;

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Chronic Renal failure

Hematological disorders

Hemophilia

Thalassaemia

Section 80CCG

Tax Benets of Rajiv Gandhi Equity Savings Scheme (RGESS)under section 80CCG has been

withdrawn. However, if you have claimed this deduction in current FY 2016-17, you can claim

the deduction for the next two Financial Years too.

Section 24 (B) (Loss under the head Income from House Property)

Tax benet on loan repayment of second house will be restricted to Rs 2 lakh per

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annum only (even if you have multiple house the limit is still going to be Rs 2 Lakh only
and the ceiling limit is not per house property).
The unclaimed loss if any will be carried forward to be set off against house property

income of subsequent 8 years. In most of the cases, this can be treated as dead loss.

I believe that this is a major blow to the investors who have bought multiple houses on
home loan(s) with an intention to save taxes alone.

As of now (till FY 2016-17), interest paid on your housing loan is eligible for the following
tax benets ;

Municipal taxes paid, 30% of the net annual income (standard deduction) and
interest paid on the loan taken for that house are allowed as deductions.

After these deductions, your rental income can be NILor NEGATIVE and is called

loss from house property in the latter case.


Such loss is currently allowed to be set off against other heads of income like

Income from Salary or Business etc. which helps you to lower you tax liability
substantially.

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Section 80E
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If you take any loan for higher studies (after completing Senior Secondary Exam), tax
deduction can be claimed under Section 80E for interest that you pay towards your Education

Loan. This loan should have been taken for higher education for you, your spouse or your
children or for a student for whom you are a legal guardian. Principal Repayment on

educational loan cannot be claimed as tax deduction.

There is no limit on the amount of interest you can claim as deduction under section 80E. The
deduction is available for a maximum of 8 years or till the interest is paid, whichever is earlier.

Section 80EE

This was a new proposal which had been made in Budget 2016-17. The same will be continued

in FY 2017-18 / AY 2018-19 too. First time Home Buyerscan claim an additional Tax deduction
of up to Rs 50,000 on home loan interest payments u/s 80EE. The below criteria has to be met

for claiming tax deduction under section 80EE.

The home loan should have been sanctioned during / after FY 2016-17.
Loan amount should be less than Rs 35 Lakh.

The value of the house should not be more than Rs 50 Lakh &
The home buyer should not have any other existing residential house in his name.

Section 80G

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Contributions made to certain relief funds and charitable institutions can be claimed as a
deduction under Section 80G of the Income Tax Act. This deduction can only be claimed when

the contribution has been made via cheque or draft or in cash. In-kind contributions such as
food material, clothes, medicines etc do not qualify for deduction under section 80G.

The donations made to any Political party can be claimed under section 80GGC.

W.e.f FY 2017-18, the limit of deduction under section 80G / 80GGC for donations made in

cash isreduced from current Rs 10,000to Rs 2,000 only.

Section 80GG

The Tax Deduction amount under80GG isRs 60,000 per annum. Section 80GG is applicable
for all those individuals who do not own a residential house & do not receive HRA(House Rent
161
Allowance).

The extent of tax deduction will be limited to the least amount of the following;

Rent paid minus 10 percent the adjusted total income.


Rs 5,000 per month.

25 % of the total income.

(If you are claiming HRA (House Rent Allowance) of more than Rs 50,000 per month (or) paying
rent which is more than Rs 50,000 then the tenant has to deduct TDS @ 5%.It has been
proposed that the tax could be deducted at the time of credit of rent for the last month of the
tax year or last month of tenancy, as applicable.)

Rebate under Section 87A

Tax rebate of Rs 2,500 for individuals with income of up to Rs 3.5 Lakh has been proposed in
Budget 2017-18.

Only Individual Assesses earning net income up to Rs 3.5 lakhs are eligible to enjoy tax

rebate u/s 87A.

For Example : Suppose your yearly pay comes to Rs 4,50,000 and you claim Rs 1,50,000
u/s 80C. The total net income in your case comes to Rs 3,00,000 which makes you

eligible to claim tax rebate of Rs 2,500.

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The amount of tax rebate u/s 87A is restricted to maximum of Rs 2,500. In case the

computed tax payable is less than Rs 2,500, say Rs 2,000 the tax rebate shall be limited to
that lower amount i.e. Rs 2,000 only.

The Tax Assesse is rst required to add all incomes i.e. salary, house income, capital
gains, business or profession income and income from other sources and then deduct the

eligible tax deduction amounts u/s 80C to 80U and under section 24(b) (Home Loan
Interest) to come up with the net taxable income.
If the above net taxable income happens to be less than Rs 3.5 lakhs then the tax rebate
of Rs 2,500 comes in to the picture and should be deducted from the calculated total

income tax payable.

Section 80 TTA

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Deduction from gross total income of an individual or HUF, up to a maximum of Rs. 10,000/-,
in respect of interest on deposits in savings account with a bank, co-operative society or post

ofce can be claimed under this section. Section 80TTA deduction is not available on interest
income from xed deposits.

Section 80U

This is similar to Section 80DD. Tax deduction is allowed for the tax assessee who is physically

and mentally challenged.

Conclusion

It is prudent to avoid last minute tax planning. Do not invest in low-yielding life insurance
polices or in any other nancial products just to save taxes. It is better you plan your taxes
based on your nancial goals at the beginning of the Financial Year itself.Plan your taxes from

April 2017 itself, instead of waiting until late December 2017 (or) January 2018.

(Read : Best ELSS Tax Saving (Sec 80c) Mutual Fund Schemes for FY 2017-18)

It is OK to pay some taxes when you can not save or cannot invest in right nancial products.
But, do not invest just to save TAXES. The cost of buying wrong nancial products may

outweigh the cost of taxes. Tax Planning is not a goal but a tool. Remember Tax Planning
alone is not Financial Planning.

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Also, kindly understand the tax treatment of the selected investment products across the

different investment stages (i.e., investment, accrual & withdrawal) and then invest. (Read :

Tax treatment of various Financial Investments)

I believe that the above list is useful for your Tax Planning purposes.The above Income Tax
Exemptions FY 2017-18are applicable for nancial year 2017-2018 (Assessment Year 2018-

2019).

(Image courtesy of Stuart Miles at FreeDigitalPhotos.net)(Post rst published on : 27-March-


2017)

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Sreekanth Reddy
Sreekanth is the Man behind ReLakhs.com. He is an Independent Certied Financial Planner
(CFP), engaged in blogging & property consultancy for the last 7 years through his rm ReLakhs
Financial Services . He is not associated with any Financial product / service provider. The main
aim of his blog is to "help investors take informed nancial decisions.""Please note that the views given in this
Blog/Comments Section/Forum are clarications meant for reference and guidance of the readers to explore
further on the topics/queries raised and take informed decisions. These should not be construed as investment
advice or legal opinion."

Connect With Me : Facebook Google+ Twitter LinkedIn

Comments

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Arun Kumar Tak says:


June 1, 2017 at 12:29 pm
Dear Sir,

Under Section 80GG: The Tax Deduction amount under 80GG is Rs 60,000 per annum.
Section 80GG is applicable for all those individuals who do not own a residential house &
do not receive HRA (House Rent Allowance).
Sir Im working in psu NTPC limited and Im staying in company provided leased
accommodation taken in my name and rent is provided by my company in full. But House
Rent Perk and HRR is deducting from my salary approximately deductions 10000 Rs PM.
Is my income is deductable under section 80 GG.
Thanks & regards
Arun Kumar Tak

161
Reply

Arun Kumar Tak says:


June 1, 2017 at 1:04 pm
Dear Sir,

Under Section 80GG: The Tax Deduction amount under 80GG is Rs 60,000 per
annum. Section 80GG is applicable for all those individuals who do not own a
residential house & do not receive HRA (House Rent Allowance).
Sir Im working in PSU NTPC limited and Im staying in company provided third
party leased accommodation, leased accommodation is taken in my name by my
company and rent is provided to land lord by NEFT by my company in full. But
House Rent Perk and HRR is deducting from my salary approximately deductions
10000 Rs PM.
Is my income is deductible under section 80 GG.
Thanks & regards
Arun Kumar Tak

Reply

K Chaithanya says:
June 1, 2017 at 9:56 am
Dear Srikanth Reddy
I am working for a pvt co and receivingRs 7.00 lakes as CTC which includes Rs0.51 lakes
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Employers contribution towards EPF and Gratuty. While Iam contributing matching
amount from my salary.
Can I deduct Rs0.51 lakes salary from CTC as I am not receiving the same and claim Rs0.51
my contribution towards EPF under Sec 80c.
Kindly clarify and guide me
K Chaithanya
D/o ksudhakararao Rao

Reply

Preetam says:
May 24, 2017 at 7:39 pm
Hi Sreekanth,

161
Thank you for the informative article.

Have doubt on whether i can claim the interest as well HRA in the below case.

Have taken a housing loan on my rst home which is far off my ofce and live with my
parents which is near as compared to my rst home. The Housing Loan was
taken(sanctioned) in May 14. As of now am paying only interest on the loan disbursed. EMI
will start once possession is given which should be hopefully by Jul17.
Given the scenario
Can i claim the interest for the given nancial and for the previous nancial years. if yes
under which section?
Can i claim HRA as rent being paid to my Father
Can i apply for Pradhan Mantri Awwas Yojana for the given loan

Thanks again,
Preetam

Reply

Sreekanth Reddy says:


May 26, 2017 at 12:13 pm
Dear Preetam,
Yes, you can claim both HRA and Tax deduction on home loan.
Kindly read :
Under construction property & tax implications
Income from house property & tax implications

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IT exemptions list for FY 2017-18


You may check with your banker on PMAY eligibility rules.

Reply

SRINIVAS says:
May 20, 2017 at 12:53 pm
Hi Could your please clarify SEC 24 Tax benet on loan repayment of second house will be
restricted to Rs 2 lakh per annum only. i own only one house which bought using home
loan and rented out due its far off from my ofce and i am staying on rent near to my
ofce. Even if its my rst and only house still tax benet on home loan interest will be
restricted to 2 lakh only wef fy 17-18. Thanks and regards
161

Reply

Sreekanth Reddy says:


May 22, 2017 at 11:38 am
Dear SRINIVAS ..Yes, it would be up to Rs 2 Lakh only.

Reply

Yepuri Sujith Kumar says:


May 18, 2017 at 4:38 pm
Hello Mr Reddy,

I have doubt on House Loan repayment.

In 80C only House Loan principal is mentioned. How about the interest, cant I claim on
that too ?

Is there any other tax savings tips to help me please

Reply

Sreekanth Reddy says:


May 19, 2017 at 12:10 pm

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Dear Sujith ..The interest payments can be claimed u/s 24, part of calculation of
income from house property.
Kindly read : Income from house property & tax implications..

Reply

Yepuri Sujith Kumar says:


May 19, 2017 at 1:42 pm
Thanks Mate.

Reply

161

Parthasarathi says:
May 7, 2017 at 11:47 pm
Thanks for the detailed article. I had a question on section 80E :
What is the denition of Education loan under this section ? I plan to take a loan against
mortgage property from HDFC bank to nance my sons higher studies abroad. Would this
qualify as Education loan and make the interest eligible for tax deduction under section
80E ?

Reply

Sreekanth Reddy says:


May 8, 2017 at 2:44 pm
Dear Parthasarathi ..No, it does not qualify under Edu loan.

Reply

Manish Chhabra says:


May 5, 2017 at 1:14 pm
Is Deductions under 80(G) in addition to 1.5 Lakhs under 80(C).
Also, tell me more about 80(G) in detail

Reply

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Sreekanth Reddy says:


May 5, 2017 at 3:34 pm
Dear Manish ..Yes, it is over and above 80c. You may just google about it..

Reply

Shripad says:
May 3, 2017 at 4:07 pm
Hi.
I have Flat in Talegaon ,(Outside of Pune).2 month back I change job from Talegaon to
shirawal(Near to Satara).so for easy transportation I shifted to place from where I have
transport facility. New place is my fathers 2nd home and I am paying rent of 500 / month
161
to him. My question is
1) Can I claim HRA ?
2) If yes , can I provide pan card of father as land lord?

Reply

Sreekanth Reddy says:


May 4, 2017 at 12:31 pm
Dear Shripad,
1 Yes (do maintain rental agreement and pay the amount via cheque / online
mode).
2 Yes.

Reply

shripad says:
May 4, 2017 at 12:54 pm
Thanks for information Sreekanth.
it means I can claim HRA as well as Income / Loss from house Property +
Housing loan principle (Unde 80 C ) right?

With regards,
Shripad

Reply

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Sreekanth Reddy says:


May 4, 2017 at 1:03 pm
Yes, you can claim both..

Reply

Kapil Bajaj says:


May 3, 2017 at 3:08 pm
Hello Sir,
161

I have invested in following mutual funds through SIP in 2017 for 10 years of time horizon
or can be extended up to 15 or 20 years as per priorities & responsibilities.

I am 30 years old now.

Goal 1:- Time Horizon 10 Years, Total Corpus Target 20-25 Lacs @ 20% CAGR consolidated
for 6 mutual funds.

Goal 2 :- Time Horizon 20 Years, Total Corpus Target 1.50 Cr to 2.00 Cr @ 20% CAGR
consolidated for 6 mutual funds.

1. DSP Black Rock Tax Saver Fund-Direct Plan-Growth Option (SIP 1000/-p.m)-ELSS Tax
Planning- First SIP Date 07.05.2017.
2. Kotak Select Focus Fund Direct Plan-Growth Option (SIP 500/-p.m)-Large Cap-First SIP
Date 10.05.2017.
3. Kotak Tax Saver -Direct Plan-Growth Option (SIP 500/-p.m)-ELSS Tax Planning-First
SIP Date 10.05.2017.
4. Birla Sun Life Tax Relief 96-Direct Plan-Growth Option (SIP 1000/-p.m)-ELSS Tax
Planning-First SIP 01.05.2017
5. Reliance Small Cap-Direct Plan-Growth Option (SIP 1000/-p.m)-Small Cap- First SIP
Date 10.06.2017.
6. Mirae Assent Emerging Blue Chip Fund-Direct Plan-Growth Option (SIP 1000/-p.m)-
Mid Cap-First SIP Date 01.06.2017

Q1. How would you rate this portfolio?

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Q2. Is this goal achievable? I can increase existing investment by 20% annually?

Q3. Please suggest few more funds for my brother separate investments for same time
period and same objective and same investment amount he is 28 years old?

Q4. How we can achieve 20 years target in 15 years?

Reply

Sreekanth Reddy says:


May 4, 2017 at 12:29 pm
Dear Kapil,
As you have very long-term goals, you may allocate slightly higher amounts to
mid/small cap funds.

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Is tax saving one of your investment objectives?
Kindly go through below articles and you may revert to me with your analysis ;
Retirement goal planing & calculator
Kids education goal planning.
MF portfolio overlap analysis tools.
How to pick right mutual fund Schemes?
Best Equity Mutual funds.

Reply

Kapil Bajaj says:


May 6, 2017 at 5:55 pm
Thanks for your suggestions!!

1. I have few more queries.


1.1. How much percentage of overlapping is acceptable?
1.2 If we would be having portfolio in Large Cap/Mid Cap/Small Cap funds so
consolidated overlapping can be reduced?
2. Yes you are right Tax saving is other objective of this investment with long
term capital gains Higher Returns with Lower and Average Risk have
considered.
3. As you have suggested I can include slightly higher amounts in Mid Cap
and Small Cap Funds?
So I have shortlisted few funds, could you please suggest any ve mutual
funds? I want to invest 1000/- in each for my younger brother.
I have analysed their overlapping in same categories of mutual funds?

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And I have kept the view of Standard Deviation, Alpha, and Beta & Sharpe
Ratio as well.
1. Mid Cap Funds
1.1 Birla Sun Life Pure Value Fund
1.2 UTI Mid Cap Fund

2. Small Cap Funds


2.1 Birla Sun Life Small & Mid Cap
2.2 Franklin India Smaller Companies Funds

3. Tax Saver
3.1 Mirae Asset Tax Saver Fund
3.2 Axis Long Term Equity Fund
3.3 Reliance Tax Saver Fund

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Reply

Sreekanth Reddy says:


May 7, 2017 at 11:45 am
Dear Kapil,
1 Overlap : There is no thumb rule, but any high overlap say 60% is
not benecial to have both the funds in the portfolio.
2 Mid cap category : UTI mid cap is ne. There are better funds than
Birla pure value fund. Ex : Mirae emerging bluechip or HDFC mid-cap
opportunities fund.
Small cap : Birla Small & mid cap, may not be a great choice.
ELSS : kindly read Best ELSS Tax saving mutual funds.

Reply

Kapil Bajaj says:


May 8, 2017 at 10:14 pm
Is ULIP a good option to invest?

Reply

Sreekanth Reddy says:


May 10, 2017 at 3:36 pm
Dear Kapil ..May I know your investment objectives,
nancial goals and time-frame??
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Reply

A Panchal says:
May 2, 2017 at 3:39 pm
I really appreciate you r hard effortsvery descriptive information for AAM admi.

161 Reply

Prakash P says:
May 2, 2017 at 12:06 pm
Hi,

I want to clear information form tax credit 87/a


Taxable gross 350000 mins
total tax amount is 5000 and credit in 2500 balance tax amount is 2500

but my taxable gross is 525000


total tax amount 17500, that case credit applicable or not

Reply

Suganthi says:
April 27, 2017 at 4:41 pm
Hi Sreekanth,

I was under the impression that tax exemption is only 1.5 L totally. Can i also get exempted
more than 1.5 L other than 80c isnt? Thank you for your time.

Reply

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Rajiv says:
April 24, 2017 at 3:47 pm
Hi Sreekanth

I am paying LIC Premiums of my parents. Can I claim premium paid for my parent? If yes,
then under which section?

Thanks

Reply

Sreekanth Reddy says:


April 24, 2017 at 5:16 pm
Dear Rajiv .. Life Insurance premium paid on parents is not eligible u/s 80-C.
161

Reply

Rajiv says:
April 24, 2017 at 5:21 pm
Thanks Sreekanth, Even though my parents are dependents, still I am not
eligible for claim. Please suggest.

Reply

Prem Chandran Nambiar says:


April 20, 2017 at 4:06 pm
Sir
I have a at co owned by my wife bought thru bank loan (wife Co applicant). Rent received
by wife thru bank which I have been adding with my income for tax purpose. Iam a govt
employee. Wife housewife and no other income except some amount of FD interest which
waved off thru. 15,G. Can my wife (pan card holder,) le IT return separately from this fy so
that I have some tax relief.

Reply

Sreekanth Reddy says:


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April 20, 2017 at 4:29 pm


Dear Prem,
If the property is jointly owned one, both of you has to declare the rental income.
Read : Do I need to le ITR?

Reply

meiyarasan says:
April 19, 2017 at 5:47 pm
hi,

i have paid my fathers medical LIC policy premium, so could i claim for tax exemption.

161
fathers age 59 (he have other source of income but it less then 1 lac per year)

thanks !
Mei

Reply

Sreekanth Reddy says:


April 19, 2017 at 6:41 pm
Dear meiyarasan ..Is it life insurance or health insurance premium?
(Section 80c or 80d)

Reply

meiyarasan says:
April 19, 2017 at 6:43 pm
health insurance

Reply

Sreekanth Reddy says:


April 19, 2017 at 6:49 pm
Dear meiyarasan ..Yes, you can claim tax deduction u/s 80D.
Read : Section 80D tax benet..

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Reply

meiyarasan says:
April 19, 2017 at 6:51 pm
thanks a lot sreekanth

Reply

161

Rohit says:
April 18, 2017 at 1:54 pm
Hi Sreekanth, I am staying in rented accommodation near to my ofce in Gurgaon. I am
planning to purchase a at with home loan in outer Gurgaon (20 km away from my ofce)
and put that at on rent. If I declare rented income as income from other source, then can
I take benet of both HRA and home loan interest?

Reply

Sreekanth Reddy says:


April 18, 2017 at 3:43 pm
Dear Rohit,
You can claim both HRA and tax benets on home loan, however you need to
declare the rental income under income from house property and not under the
head income from other sources.

Reply

Rohit says:
April 20, 2017 at 11:37 pm
Thanks Sreekanth,
If my wife is co-applicant in home loan and our rented property is registered
in joint name, Can each of us show 50% of rental income to save income tax.
For example if annual rental income is 2L, then we have to show 1L each or it
will be in proportionate to amount of share in home loan?
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Thanks

Reply

Sreekanth Reddy says:


April 21, 2017 at 2:54 pm
Dear Rohit ..Yes, you can declare Rs 1 Lakh each (if there is no specic
mention of ownership shares in the Sale deed).

Reply

161

sushil maurya says:


April 18, 2017 at 10:28 am
i paid premium of Life insurance policy which is my wifes name . from my salary, can i
elegible to take a benits u/c 80 c. my wife is a housewife and no source of income.

Reply

Sreekanth Reddy says:


April 18, 2017 at 12:08 pm
Dear Sushil ..Insurance premium paid for yourself, your spouse or your children is
allowed as deduction under section 80C

Reply

Abhisek BAKSHI says:


April 17, 2017 at 8:59 pm
Hi,

I have a self occupied home on which I have taken a joint loan with my wife. we claim 2L
each as tax benet last anacial year. We are planning to buy another house with joint loan
for renting it out. with restpect to new tax rules how much we can claim tax benet? is it

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2L each for self occupied and the 2 lakh each for rent out property or , it is 2 lakh each for
self occupied and 2 lakh overall for ( split between me and my wife) for rented out
property?

Reply

Sreekanth Reddy says:


April 18, 2017 at 11:59 am
Dear Abhisek,
Both of you can claim max Rs 2 Lakh (on both properties) each.

Reply

161

Neha says:
April 17, 2017 at 4:56 pm
Hi Srikanth,

My question is regarding HRA.


From this year onwards any kind of verication is going to happen? We have heard lot of
news about it.

The place where I stay is rented one which belongs to one of my uncle.Is that totally ne if
I provide PAN of my uncle while submitting HRA as he doesnt have any other source of
income.

Also let me know what can be done in the scenario if an employee is paying rent for
himself/herself and paying the rent for his/ her parents in other city?

Regards,
Neha Varshney

Reply

Sreekanth Reddy says:


April 18, 2017 at 11:57 am
Dear Neha,
Yes, there has been few Cases where IT dept has disagreed to accept claims related
to Rent receipts (HRA).

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6/1/2017 LatestIncomeTaxExemptionsFY201718/AY201819|TaxDeductions

It is always advisable to make only genuine claims wrt to tax deductions..


Paying rent for himself?
Kindly get Rental agreement done with your Uncle/Parents. You have to make sure
that you pay the rent to their respective bank account(s) only.

Reply

RAKESH GUPTA says:


April 17, 2017 at 4:20 pm
I have taken home loan for current nancial year with my wife as co-applicant. Will both of
us will get exemption on payment of interest upto Rs.2 lakhs each from this nancial year
onwards.
161

Reply

Sreekanth Reddy says:


April 18, 2017 at 11:54 am
Dear RAKESH ..Yes..provided both of you are Co-owners of the property.

Reply

Pravin Rajendran says:


April 17, 2017 at 10:25 am
Is the 2 lakh limit under Section 24 only applicable from the second home onwards?
Suppose i buy a rst home, and rent it out. can i take unlimited benet on interest
expense?

Reply

Sreekanth Reddy says:


April 17, 2017 at 5:45 pm
Dear Pravin ..No, in that case too, the loss will be limited to Rs 2 Lakh only and the
balance can be carried forward..

Reply

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Uteesh Dhar says:


April 16, 2017 at 7:13 pm
Educative, Informative. Great Keep it up. I have bookmarked the article for future use

Reply

Sreekanth Reddy says:


April 17, 2017 at 5:43 pm
Thank you dear Uteesh.
Keep visiting ReLakhs and kindly share the article(s) with your friends!

Reply
161

K says:
April 13, 2017 at 12:36 pm
I have PF which is amounting to 1.5L apart from this can I still claim 1.5L in NPS : under
80CCC Pension Fund Contribution?

Reply

Sreekanth Reddy says:


April 13, 2017 at 3:37 pm
Dear K ..No, the aggregate amount under 80C+80CCC is Rs 1.5 Lakh only.

Reply

K says:
April 14, 2017 at 12:04 am
Ooh.. ok.. Thank you very much for the clarication

Reply

Thirunavukkarasu says:
April 19, 2017 at 11:58 am

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I believe we can claim upto Rs. 50000 on top of 1.5L through 80CCC (NPS)

Reply

Thirunavukkarasu says:
April 19, 2017 at 12:03 pm
Please ignore my previous post.

80CCD (NPS) is allowed Rs.50000 on top of 1.5L (80C+80CCC)

Reply

161

Amrit Pati says:


April 11, 2017 at 7:43 pm
Dear Sreekanth,

I have a row item of 10k showing in my salary structure of CTC, which goes as a premium
to a Company Medical Insurance. This amount does not show in my Income under salary
head in Form 16. Can I still use this 10k for showing a deduction under 80D?

Reply

Sreekanth Reddy says:


April 12, 2017 at 5:56 pm
Dear Amrit,
If Rs 10k is a deduction from your salary, you can claim it as a tax deduction u/s
80D.

Reply

indrajeet yadav says:


April 8, 2017 at 5:01 pm

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Dear Srikanth,
Please reply for my few queries if possible
1 ; This FY year i have expand more than one lakh for my fathers critcle dease, then how
much amount i can take rebate?
2; I have taken rebate in last two years 12 & 19 thousands respectively in 8 years now this
year i want to take 47k rebate refund ?
3;After how much years we can sell out at to avoid extra taxes.

Thanks

Reply

Sreekanth Reddy says:


April 10, 2017 at 2:18 pm
161 Dear indrajeet,
1 Do you receive medical allowance in your Salary (if salaried)?
Kindly go through Section 80DDB and its eligibility criteria..
2 I dint get your point/query..??
3 What do you mean by extra taxes?
Kindly read: Long term capital gain taxes on sale of property

Reply

indrajeet yadav says:


April 11, 2017 at 11:25 am
Dear Sir,
As per your query
1- I am getting 60k annual medical allowance and claimed 60k
2- I am saying about as i am working from last 8 years but only claimed last 2
years 19k and 12 k in LTA.
is i am able to take lta benet this year also because i heard LTA provided in 4
years block 2 times till 48000k.Even it can be carry forward if not claimed in
any block(4year).
3- extra taxes means long term , short term gains or any other taxes if home
loan and rebate taken in past.
thanks

Reply

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Sreekanth Reddy says:


April 11, 2017 at 12:24 pm
Dear Indrajeet,
1 One may avail for reduction in the taxable income for a maximum
of or up to Rs 15,000 for medical expenses during each nancial year.
2 Ok.LTA tax exemption can be claimed twice (two journeys taken) in
a block of four calendar years. That means, the current block of four
years is 1st Jan 2014- 31 Dec 2017 block.
If you went only on one vacation in these four years, the other one can
be carry forwarded on the next 4-year block, but this must be claimed
in the rst year of the next block, meaning by 31 Dec 2018.
3 Kindly read : Different Asset classes have different Tax implications
How Returns are taxed?

161 Reply

indrajeet yadav says:


April 11, 2017 at 5:09 pm
thanks !

Reply

Ritesh says:
April 7, 2017 at 3:02 pm
Home loan1 has 1.43 lakhs interest and 1.25 lac prinicpal ( which i claim as self occupied)

Home loan2 i pay 7 lacs interest and 5 lacs principal (and rent received 15K/month 30%
) accounted and remaining comes around
= 5.75 lacs interest and 5 lacs prinicipal

so myself claim total interest = 3.43 L , principal 1.5 L ( not sure i can claim principal from
2nd HL or i will be capped from 1.25L )

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my wife claim interest = 2 L , principal 1.5L ( not sure my wife can claim both principal and
interest even though for her its 1st HL).

With the above conditions can you suggest best way to claim the 2 home loans from both
of us, we pay heavily the interest( close to 9.43L interest + 6.25L as principal) to the banks
need good suggestions to override accounting the changes in this budget.

Reply

Sreekanth Reddy says:


April 7, 2017 at 3:17 pm
Dear Ritesh,
You can claim principal repayment of up to Rs 1.5 Lakh u/s 80c. And interest
payments of up to Rs 2 Lakh only can be claimed (both properties put together) and
161 the remaining unclaimed loss has to be carried forward to next assessment years.
Same would be the case with your spouse, if she is a joint borrower/owner.

Reply

Hema Desai says:


April 6, 2017 at 12:19 pm
Hello Shrikaanth R
Really very well drafted Article. Very useful to plan and explain it to Employees.

All the very Best!

Reply

Sreekanth Reddy says:


April 6, 2017 at 12:29 pm
Thank you dear Hema.
You may kindly suggest your friends / team to go through other related articles as
well.
Keep visiting ReLakhs

Reply

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Chandresh Nigam says:


April 3, 2017 at 11:04 am
Hi Sreekanth, Hope youre doing well.

Ive few queries on Income tax :

1- My CTS is 10 Lakh
2- My savings / rent details are below
a- LIC (Brila Vision Lifeincoe) 39,400/yearly,
b-ULIP (HDFC Click 2 Protect) -48,000/yealy
c- Company PF 39060
d- PPF 10000
e- Rent 10000/ Month
f- 3 Lakh medical cover from company

161
Planning to take Term plan ( 1 Cr life cover), earlier I took it but that Ive cancelled due to
wrong info.
I cant take home loan due to family responsibilities.

Could you pls suggest me in which section like (80 EE/ 80 GG) I can invest some money to
save more tax.

Thank You !!

Reply

Sreekanth Reddy says:


April 3, 2017 at 3:07 pm
Dear Chandresh,
What is 2.a . product?
Tax saving should not your starting point to plan investments.
May I know your nancial goals / objectives?
I have provided almost all important sections in the above article, you may refer to
them

Reply

Mohit Bansal says:

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April 2, 2017 at 7:35 pm


I bought a house in Noida, Builder got CC so he offered tout based possession, i moved in
in Jan 2017. This is my rst property. No registry happened yet, not sure if registry will
happen in FY (2017-2018) also. My questions are:
1. Can i claim Repayment of Principal Amount on Housing Loan under 80C?
2. Can i get benet under 80E for payment of Interest.
3. I work in Gurgaon, can i get benet of HRA also?

Reply

Sreekanth Reddy says:


April 3, 2017 at 11:52 am
Dear Mohit,
1 & 2 No, as the registration is yet to happen. (It is sec 80EE and not 80E).
161 3 If you are using the property for self-occupation, you can not claim HRA.

Reply

Srikanth Varma Chakka says:


March 29, 2017 at 10:00 pm
Hi Sreekanth,

Hope everything is going well with you. Ive a query related to section 24B.

If Ive a house in Hyderabad and its the only house on my name, can I still claim the
interest loss on house property by giving it as let out property or My tax exemption in this
case is also limited to two lakhs ?

Please clarify. Im confused because in your article it is mentioned about the change in rule
for second house onwards.

BR, Srikanth Varma

Reply

Sreekanth Reddy says:


March 30, 2017 at 12:34 pm

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Dear Srikanth,
All is well! thank you!
Trust the same with you.
It is limited to Rs 2lakh only and the unclaimed loss can be carried forward.

Reply

Srikanth Varma Chakka says:


March 30, 2017 at 2:02 pm
Thanks for your reply Sreekanth.

To conclude, whether its a rst or second house and either its a self
occupied or let-out property, the max tax exemption would be 2 Lakh.
(Irrespective of number houses total income loss on house property would be
161 4Lakhs (2Lakh on 1st house + 2 Lakhs on rest of the houses).

This is too bad. Lot of my friends (including me) will be greatly effected by
this. It should have been for the loans taken on or after April 1st 2017. A lot of
us take large amounts on home loans considering the fact that we can save a
lot on income taxes.

This is kind of a unprecedented burden as we cant clear this large loan and
cant keep it with loss of IT benets.

Whats your view on this move?

Reply

Sreekanth Reddy says:


March 30, 2017 at 2:33 pm
Dear Srikanth,
It is Rs 2 Lakh and not Rs 4 Lakh.
May be, yes, the amendment could have been for the loans taken from
FY 2017-18 onwards and not retrospectively.

Reply

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RAJ says:
March 29, 2017 at 2:00 pm
Dear Sreekanth,

Happy Ugadi to you and your family and relakhs.com

regards
RAJ

Reply

Sreekanth Reddy says:


March 30, 2017 at 12:32 pm
Thank you so much dear Raj..
161 Wish you too the same, happy Ugadi!

Reply

Suchita says:
March 28, 2017 at 11:33 pm
Hi , I want to know more about section 80GGT as my husband is working in a NGO n
doesnt get any HRA nor do we own a house. Kindly advise

Reply

Sreekanth Reddy says:


March 30, 2017 at 12:31 pm
Dear Suchita ..Are you referring to 80GG?
For more info on Section 80GG, you may go through this link..

Reply

SRINATH says:
March 28, 2017 at 7:42 pm
Hi Sreekanth,

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Its really good read this blog, i have very less knowledge about Mutual Funds, and Iam very
interested to invest in it, i can invest Rs.12,000/- per month, for next 15 years, to take care
of my kids education & marriage etc.

please suggest where to invest how much to invest

thanks in advance

Regards
Srinath

Reply

Sreekanth Reddy says:


March 30, 2017 at 12:27 pm
161
Dear SRINATH,
Kindly go through below articles and you may revert to me if you need more info;
Kids education goal planning.
List of best investment options.
Best Equity funds.
How to select right mutual fund schemes?

Reply

Ramnath says:
March 28, 2017 at 4:27 pm
Hi Sreekanth
I own a house in my home town now residing in quarters owned by my company for which
they add perks in my salary.kindly let me know whether there is any section in IT act where
present perks can be exempted while ling ITR so that I can claim any refund if any and I
dont have any housing
loan.

Reply

Sreekanth Reddy says:


March 30, 2017 at 12:25 pm

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Dear Ramnath,
May I know what kind of Perks are they?

Reply

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