December 4, 2016

HRA increased from 24,000 to 60,000 under section 80GG, With Automated All in One Excel Based Software for Govt and Private Employees for F.Y.2016-17

What is HRA? What is House Rent Allowance?

House Rent Allowance or HRA is given by the employer to the employee to meet the expenses of rent of the accommodation which the employee has taken for his residential purpose. Salaried individuals who live in a rented house can claim House Rent Allowance or HRA to lower taxes. This can be partially or completely exempt from taxes. The allowance is for expenses related to rented accommodation. If you don’t live in a rented accommodation, this allowance is fully taxable. House Rent Allowance (HRA) Exemption would be calculated by your employer and shown in Form 16 if rent receipt is submitted on time.

Self-employed professionals cannot be considered for HRA exemption under this act, as they do not earn a salary. However, they can claim benefits on the house rent expenses incurred under section 80GG, which resembles section to 10 (13A) but is subject to certain conditions.

Download All in One automated Income Tax Preparation Excel Based Software for Govt & Non-Govt(Private) employees for the F.Y.2016-17. [This Excel Utility can prepare at a time your Tax Compute Sheet + Individual Salary sheet + Individual Salary Structure as per Govt & Private Employees Salary Pattern + Automatic H.R.A. Calculation + Automatic Arrears Relief Calculation with Form 10E + Automated Form 16 Part A&B and Form 16 Part B]


Understanding 80GG

What is section 80GG?

Section 80GG provides for Deductions for House Rent paid, provided that a deduction for payment of House Rent has not been claimed under any other section of the income tax act. In other words, if a salaried employee is being given house rent allowance by his employer and he is claiming a deduction from the same, he won’t be eligible to claim deduction under Section 80GG for payment of Rent. All other taxpayers who are neither getting the benefit of House Rent Allowance and nor have they claimed the expense for rent paid under any other section of the income tax act, can claim deduction under Section 80GG. HRA limit under section 80GG has been proposed to be increased from 24,000 to Rs.60,000/- from the F.Y.2016-17

What is Form 10BA?

If the taxpayer is claiming deduction under Section 80GG, he would also be required to furnish a declaration in Form 10BA that he satisfies all the conditions stated above. An image below shows the Form 10BA . You can Download Form 10BA.


What is HRA? What is House Rent Allowance?

House Rent Allowance or HRA is given by the employer to the employee to meet the expenses of rent of the accommodation which the employee has taken for his residential purpose. Salaried individuals who live in a rented house can claim House Rent Allowance or HRA to lower taxes. This can be partially or completely exempt from taxes. The allowance is for expenses related to rented accommodation. If you don’t live in a rented accommodation, this allowance is fully taxable. House Rent Allowance (HRA) Exemption would be calculated by your employer and shown in Form 16 if rent receipt is submitted on time.

Self-employed professionals cannot be considered for HRA exemption under this act, as they do not earn a salary. However, they can claim benefits on the house rent expenses incurred under section 80GG, which resembles section to 10 (13A) but is subject to certain conditions.

Download All in One automated Income Tax Preparation Excel Based Software for Govt & Non-Govt(Private) employees for the F.Y.2016-17. [This Excel Utility can prepare at a time your Tax Compute Sheet + Individual Salary sheet + Individual Salary Structure as per Govt & Private Employees Salary Pattern + Automatic H.R.A. Calculation + Automatic Arrears Relief Calculation with Form 10E + Automated Form 16 Part A&B and Form 16 Part B]


Understanding 80GG

What is section 80GG?

Section 80GG provides for Deductions for House Rent paid, provided that a deduction for payment of House Rent has not been claimed under any other section of the income tax act. In other words, if a salaried employee is being given house rent allowance by his employer and he is claiming a deduction from the same, he won’t be eligible to claim deduction under Section 80GG for payment of Rent. All other taxpayers who are neither getting the benefit of House Rent Allowance and nor have they claimed the expense for rent paid under any other section of the income tax act, can claim deduction under Section 80GG. HRA limit under section 80GG has been proposed to be increased from 24,000 to Rs.60,000/- from the F.Y.2016-17

What is Form 10BA?

If the taxpayer is claiming deduction under Section 80GG, he would also be required to furnish a declaration in Form 10BA that he satisfies all the conditions stated above. An image below shows the Form 10BA . You can Download Form 10BA.


December 3, 2016

Enhanced the Tax Rebate of Rs.2000 to Rs. 5,000/- U/s 87 for Financial Year 2016-17, With All in One Tax Preparation Excel Utility for Central Govt employees for F.Y.2016-17

Click here to download Automatic All in One Income Tax Preparation Excel Based Software Central Govt employees for F.Y.2016-17 [ This Excel Utility can prepare at a time Tax Compute Sheet + Automatic H.R.A.Exemption Calculation + Automated Form 16 part A&B and Form 16 Part B]


After all the problems in the form of thousands of taxes faced by the taxpayers, in the budget of 2016, a minute relief against income tax has been provided for small tax payers. The rebate enhances from Rs.2000/- to Rs.5,000/- for F.Y.2016-17 which is now available to small taxpayers who have income below Rs. 5,00,000. There are some misconceptions among the people regarding this relief being available to them, this article focuses on the technical point of view for the relief under section 87A.
Conditions of claiming Rebate u/s 87A:
1.   The taxpayer must be a resident individual and is not applicable to NRI.
2.   The income of the taxpayer should not exceed Rs. 5,00,000 after claiming deduction u/s 80C to 80U.
Amount to be claimed:
The taxpayer can claim the rebate u/s 87A if the above two conditions are satisfied. The amount of rebate which can be claimed by a resident individual is 100% of the income tax payable on total income after deduction of 80C to 80U or Rs. 5000/- whichever is lower. This rebate is allowed out of the total income tax payable amount without adding surcharge and education cess.

Effective Date of section 87 A:
Taxpayers can take the benefit of this section from the AY 17-18 i.e. FY 16-17. This section is not applicable for NRI, resident or non-resident HUF/AOP/BOI or any taxpayer other than the resident individual.
Wrong understanding of section 87A
Some taxpayer might end up with the conclusion that when tax payable is below Rs. 2000 or Nil then also they can claim the rebate of Rs. 5000 but as discussed earlier that lower of the 100% of income tax or Rs. 2000 is allowed as rebate cum relief to taxpayers.

For Example  Mr. X earns income during the year and after deduction, it comes to Rs. 215000. So tax on Rs. 215000 is Rs. 1500. Rebate allowable will be RS. 1500 or Rs. 5000 whichever is lower. Therefore rebate of Rs. 1500 will be given to the taxpayer and not Rs. 5000.

Click here to download Automatic All in One Income Tax Preparation Excel Based Software Central Govt employees for F.Y.2016-17 [ This Excel Utility can prepare at a time Tax Compute Sheet + Automatic H.R.A.Exemption Calculation + Automated Form 16 part A&B and Form 16 Part B]


After all the problems in the form of thousands of taxes faced by the taxpayers, in the budget of 2016, a minute relief against income tax has been provided for small tax payers. The rebate enhances from Rs.2000/- to Rs.5,000/- for F.Y.2016-17 which is now available to small taxpayers who have income below Rs. 5,00,000. There are some misconceptions among the people regarding this relief being available to them, this article focuses on the technical point of view for the relief under section 87A.
Conditions of claiming Rebate u/s 87A:
1.   The taxpayer must be a resident individual and is not applicable to NRI.
2.   The income of the taxpayer should not exceed Rs. 5,00,000 after claiming deduction u/s 80C to 80U.
Amount to be claimed:
The taxpayer can claim the rebate u/s 87A if the above two conditions are satisfied. The amount of rebate which can be claimed by a resident individual is 100% of the income tax payable on total income after deduction of 80C to 80U or Rs. 5000/- whichever is lower. This rebate is allowed out of the total income tax payable amount without adding surcharge and education cess.

Effective Date of section 87 A:
Taxpayers can take the benefit of this section from the AY 17-18 i.e. FY 16-17. This section is not applicable for NRI, resident or non-resident HUF/AOP/BOI or any taxpayer other than the resident individual.
Wrong understanding of section 87A
Some taxpayer might end up with the conclusion that when tax payable is below Rs. 2000 or Nil then also they can claim the rebate of Rs. 5000 but as discussed earlier that lower of the 100% of income tax or Rs. 2000 is allowed as rebate cum relief to taxpayers.

For Example  Mr. X earns income during the year and after deduction, it comes to Rs. 215000. So tax on Rs. 215000 is Rs. 1500. Rebate allowable will be RS. 1500 or Rs. 5000 whichever is lower. Therefore rebate of Rs. 1500 will be given to the taxpayer and not Rs. 5000.

December 1, 2016

Tax Benefits on Home Loan U/s 80C,80EE and 24B, With Automated Master of 50 and 100 employees Form 16 Part A and B and Part B for F.Y.2016-17

Tax Benefits for Various Sections of Home Loan:
The tax benefits under various sections of the Income Tax Act not only attract people who need a loan put is also beneficial for people who can pay out of there on the source of savings, as it provides them flexibility in payment and they need not do away with their liquidity.
Let’s first note the various income tax provisions under which tax benefits are available to the taxpayers.

Download & Prepare at a time 50 employees automated Income Tax Form 16 Part B for F.Y.2016-17 [ This Excel Based Software can prepare at a time 50 employees Form 16 Part B as per the Finance Bill 2016-17]

Form 16 Part B
Form 16 Salary Structure
Main Data input sheet for Filling the Form 16 Part B
  • Tax Benefits for Interest paid on housing loan: Repayment of housing loan is through Equated Monthly Installments (EMI) which consists of principal and interest component. The interest component of the EMI is allowed as a deduction under the head ‘Income from Housing Property’, u/s 24 of the Income Tax Act. The amount permissible for deduction is Rs. 2,00,000/- for AY2017-18. Further, in case the house against which loan is taken is given on rent, there is no cap on the amount of interest allowed as deduction.
  • Tax Benefits for Repayment of principal on Home Loan: The principal component paid out of the EMI is permissible as a deduction up to Rs. 1,50,000/- under section 80C of the Income Tax Act.
  • Interest paid during the pre-construction period on Home Loan: Interest deduction cannot be claimed for under construction property. However, once the construction is completed, the amount of interest paid on the loan borrowed prior to completion, which is ‘Pre-construction interest’, can be claimed as a deduction in 5 equal installments from the financial year in which construction is completed. Further, construction has to be completed within 5 years from the end of the financial year in which loan is taken.
  • Higher deduction in case of a Joint Home loan and ownership: In case both husband and wife are working, the deduction with respect to interest on the home loan and repayment of principal can be claimed by both in the proportion to their ownership share.

Download Automated 50 employees Income Tax Form 16 Part A & B for F.Y. 2016-17 [ This Excel Utility can prepare at a time 50 employees Form 16 Part A &B for F.Y.2016-17]

Form 16 Part A &B
Avail both Home loan deduction and House Rent Allowance (HRA) exemption: The deduction u/s 24 (Interest on a home loan) and u/s 80C (Repayment of principal) can be claimed along with exemption of HRA. For e.g. A person has bought a flat in Pune and taken a home loan for the same. However, due to his job requirement, he needed to shift to Mumbai in a rented apartment. In this case, he can claim rent paid for the Mumbai Property as HRA exemption [u/s 10(13A)] along with a deduction of interest and principal for the Pune property.

Download Automatic House Rent Exemption Calculator U/s 10(13A)



Tax Benefits for Various Sections of Home Loan:
The tax benefits under various sections of the Income Tax Act not only attract people who need a loan put is also beneficial for people who can pay out of there on the source of savings, as it provides them flexibility in payment and they need not do away with their liquidity.
Let’s first note the various income tax provisions under which tax benefits are available to the taxpayers.

Download & Prepare at a time 50 employees automated Income Tax Form 16 Part B for F.Y.2016-17 [ This Excel Based Software can prepare at a time 50 employees Form 16 Part B as per the Finance Bill 2016-17]

Form 16 Part B
Form 16 Salary Structure
Main Data input sheet for Filling the Form 16 Part B
  • Tax Benefits for Interest paid on housing loan: Repayment of housing loan is through Equated Monthly Installments (EMI) which consists of principal and interest component. The interest component of the EMI is allowed as a deduction under the head ‘Income from Housing Property’, u/s 24 of the Income Tax Act. The amount permissible for deduction is Rs. 2,00,000/- for AY2017-18. Further, in case the house against which loan is taken is given on rent, there is no cap on the amount of interest allowed as deduction.
  • Tax Benefits for Repayment of principal on Home Loan: The principal component paid out of the EMI is permissible as a deduction up to Rs. 1,50,000/- under section 80C of the Income Tax Act.
  • Interest paid during the pre-construction period on Home Loan: Interest deduction cannot be claimed for under construction property. However, once the construction is completed, the amount of interest paid on the loan borrowed prior to completion, which is ‘Pre-construction interest’, can be claimed as a deduction in 5 equal installments from the financial year in which construction is completed. Further, construction has to be completed within 5 years from the end of the financial year in which loan is taken.
  • Higher deduction in case of a Joint Home loan and ownership: In case both husband and wife are working, the deduction with respect to interest on the home loan and repayment of principal can be claimed by both in the proportion to their ownership share.

Download Automated 50 employees Income Tax Form 16 Part A & B for F.Y. 2016-17 [ This Excel Utility can prepare at a time 50 employees Form 16 Part A &B for F.Y.2016-17]

Form 16 Part A &B
Avail both Home loan deduction and House Rent Allowance (HRA) exemption: The deduction u/s 24 (Interest on a home loan) and u/s 80C (Repayment of principal) can be claimed along with exemption of HRA. For e.g. A person has bought a flat in Pune and taken a home loan for the same. However, due to his job requirement, he needed to shift to Mumbai in a rented apartment. In this case, he can claim rent paid for the Mumbai Property as HRA exemption [u/s 10(13A)] along with a deduction of interest and principal for the Pune property.

Download Automatic House Rent Exemption Calculator U/s 10(13A)



November 30, 2016

You can Claim of Interest on Housing loan & HRA; Interest deduction against Home Loan, With Automatic 100 employees Master of Form 16 Part B for F.Y.2016-17

Assessee claim deduction of Interest on Housing Loan to acquire house property u/s 24(b) and simultaneously HRA exemption on rent paid (if he resides in property other than acquired). Further upon sale of said property, interest already claimed as deduction u/s 24(b) can be added to cost of property for the purpose of computing capital gain.   

Download and prepare at a time 100 employees Form 16 Part B for F.Y.2016-17 [ This Excel Utility can prepare at a time 100 employees Form 16 Part B with amended all Income Tax Section by the Finance Bill 2016-17]


An assessee can claim a deduction of Interest on Housing loan taken to acquire a house property u/s 24(b) of the Income Tax Act. Section 10(13A) allows an assessee to claim HRA exemption in respect of rent paid for residential accommodation occupied by him. Further, where expenditure was incurred by way of interest on a loan is taken to acquire a house property, same shall be allowed to be added to cost for the purpose of computing capital gains upon sale of the said property.
The question under consideration is whether an assessee can claim all the aforementioned benefits together. Or to be more precise does avail of one the benefit, precludes assessee from claiming other benefits.
 HRA Exemption U/s 10(13A):-  Download Automatic H.R.A. Calculator U/s 10(13A)
Explanation to section 10(13A) provides that HRA exemptions shall be available if both the conditions are satisfied :
(a) the residential accommodation occupied by the assessee is not owned by him ; and
(b) the assessee has actually incurred expenditure on payment of rent (by whatever name called) in respect of the residential accommodation occupied by him

Deduction for interest as per Section 24(b): Max limits Rs. 2 Lakh.
Assessee claim deduction of Interest on Housing Loan to acquire house property u/s 24(b) and simultaneously HRA exemption on rent paid (if he resides in property other than acquired). Further upon sale of said property, interest already claimed as deduction u/s 24(b) can be added to cost of property for the purpose of computing capital gain.   

Download and prepare at a time 100 employees Form 16 Part B for F.Y.2016-17 [ This Excel Utility can prepare at a time 100 employees Form 16 Part B with amended all Income Tax Section by the Finance Bill 2016-17]


An assessee can claim a deduction of Interest on Housing loan taken to acquire a house property u/s 24(b) of the Income Tax Act. Section 10(13A) allows an assessee to claim HRA exemption in respect of rent paid for residential accommodation occupied by him. Further, where expenditure was incurred by way of interest on a loan is taken to acquire a house property, same shall be allowed to be added to cost for the purpose of computing capital gains upon sale of the said property.
The question under consideration is whether an assessee can claim all the aforementioned benefits together. Or to be more precise does avail of one the benefit, precludes assessee from claiming other benefits.
 HRA Exemption U/s 10(13A):-  Download Automatic H.R.A. Calculator U/s 10(13A)
Explanation to section 10(13A) provides that HRA exemptions shall be available if both the conditions are satisfied :
(a) the residential accommodation occupied by the assessee is not owned by him ; and
(b) the assessee has actually incurred expenditure on payment of rent (by whatever name called) in respect of the residential accommodation occupied by him

Deduction for interest as per Section 24(b): Max limits Rs. 2 Lakh.

 
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