1/20/2017 LatestIncomeTaxSlabsandRatesforFY201617andAY201718

LatestIncomeTaxSlabsandRatesforFY201617andAY201718

by

AllBankingSolutions.comTeam

AdsbyGoogle ThefollowingINCOMETAXRATESAREapplicablefortheFinancialYearendingMarch31,
FinancialYear201617)AssessmentYear201718)
Everyyeartheincometaxratesarechangedanditisimportanttogetthelatestincometaxrates.Wegiveb
theIncomeTaxRatesandSlabsapplicablefortheFY201617orAY201718.[Astherewasno
IncomeTaxslabsforFY201617(i.e.AY201718),thefollowingrateswerealsoapplicableforF
16(AY201617)&FY201415(AY201516)

Women(Below60yearsof SeniorCitizens Very

General age) (Menand
(nonsenior (Thiscategoryisabolished Womenabove
IncomeRange
citizens) fromthisyearandisthus 60yearsofage),
Category issameasthatofGeneral butbelow80
Category years yearsof
UptoRs.2,50,000 Nil Nil Nil Nil
Rs.2,50,001toRs.
10%* 10%* Nil Nil
3,00,000
Rs.3,00,001toRs.
10%* 10%* 10%* Nil
5,00,000
Rs.5,00,001toRs.
20% 20% 20% 20%
10,00,000
AboveRs.10,00,000 30%** 30%** 30%** 30%**

Thus,wecansay:

1.Thebasicexemptionlimitforindividuals(i.e.below60yearsofage)isRs2.50lakhs
2.ThebasicexemptionlimitforSeniorcitizens(60yearstobelow80years)is:Rs3.00lakhs
3.ThebasicexemptionlimitforVerySeniorCitizens(80yearsandabove)isRs3.50lakhs

*AtaxrebateofRs.5000fromtaxcalculatedwillbeavailableforpeoplehavinganannualincomeuptoRs5lakh(forFY201516,thetaxrebateinthiscategoryused
2000).However,thisbenefitofRs.5000taxcreditwillnotbeavailableifyoucrosstheincomerangeofRs5lakh.Thuswecansaythattaxpayablein10%slabwillbe
Rs20,000(takingintoaccountRs5000taxcredit),butforpeoplewhofallinincomerangeofRs5lakhandabove,thetaxwillbeRs25,000+20%taxonincomeabove
Duetothisprovision,thosewhoearnbelowRs.3lakhsarenotrequiredtopayanytax.

**Theeducationcesstocontinueat3percent.

***TheSurcharge@15%fortheFY201617orAS201718willbepayableiftheincomeisaboveRs1crores).FortheFY201516itwas12%.

However,sometaxreliefhasbeengiveninFY201617throughthefollowingrebates:
Asmentionedabove,theincometaxrebateisincreasedtoRs5000fortaxableincomebelowRs.5lakhs
Thetaxdeductionforrentpayment(section80GG)isincreasedfromRs.24000toRs.60000.Thisdeductionisavailabletothose,wholiveinrentedhouse,andd
getHouseRentAllowancefromtheiremployer.
FirsttimehomebuyerscanclaimanadditionalTaxdeductionofuptoRs.50,000onhomeloaninterestpaymentundersection80EE.ThisextradeductionofRs
wouldbeavailableover&abovethe80ClimitofRs.1.5lakhs.ItmeansthattotaltaxdeductionunderSection80CcangouptoRs.2lakhsprovidedatleastRs5
paidashomeloaninterestwithinthefinancialyear.Thisextrataxdeductionisavailabletoonlythosehomebuyers,whomeetALLthefollowingcriteria(i)wh
homeloansanctionedinFY201617(ii)whoseloanamountislessthan35lakhs(iii)valueofhouseshouldnotbemorethanRs.50lakhs
TherewouldbenocapitalgainstaxonredemptionoftheSovereignGoldBond.ThelongtermcapitalgainsarisingfromtransferofGoldBondwouldbeeligible
Indexationbenefit.TheSovereignGoldbondschemeislaunchedtodiscouragethepurchaseofphysicalgoldfortheinvestmentpurpose.
Thegovernmentwouldnotchargeanycapitalgainstaxontheinterestincomeofgoldmonetizationscheme.Thegoldmonetizationschemewaslaunchedtochan
idlehouseholdgold
The40%withdrawalofNPS(NationalPensionSystem)wouldbeexemptedfromthetax.AlongwiththistheNPS,wealthgivetothenomineeafterthedeathof
subscriberwouldbe100%exemptfromthetax.
Ifanemployerinvestsintothepensionfundofanemployee,theinvestedamountisexemptfromtax.Thisyear'sbudget(2016)hasincreasedtheexemptionlimi
lakhtoRs.1.5lakh.

OtherImportantLinks:
DownloadFREEMajorITRFormsforFinancialYear201415ITR1,ITR2,ITR2A,ITR4Spdffiles,FillablefilesAND
Instructions
HOWTOMAKEBESTUSEOFSECTION80CORSavingTaxByInvestingUnderSection80C

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1/20/2017 LatestIncomeTaxSlabsandRatesforFY201617andAY201718

HowtoAvoidTDSDeductionbyBanksHOTTIPSFORTDSinBanks

SOMEVERYPOPULARSCHEMESFORINVESTMENTS(INCLUDINGFORTAXSAVINGS)

DownloadPDFfilesforForm15G,Form15H,Form60,Form61

MajorChangesinBudgetforFY201617

Changesasper Changesasper
Provisionsfor
BudgetforFY BudgetforFY2016
FY201415
201516 17
Particulars
OR
OR OR
AY201516
AY201617 AY201718

SurchargeontaxableincomeexceedingRs.1 10%ofIncome 12%ofIncomeTax 15%ofIncomeTax

CroreforIndividuals,SeniorCitizens,Very Tax
SeniorCitizens,HUFs,AOPs,BOIs,artificial
juridicalpersons,firms,cooperativesocieties
andlocalauthorities

ComparisonofBenefitsundervariousITSections

Exemptedamountoftransportallowance Rs.800/per Rs.1,600/per Rs.1,600/permonth

month month

Section80DDeductionforHealthInsurance Rs.15,000/ Rs.25,000/ Rs.25,000/

premium

Section80DDeductionforHealthInsurance Rs.20,000/ Rs.30,000/ Rs.30,000/

premiumforSeniorCitizens

InvestmentinSukanyaSamriddhiScheme Eligiblefordeduction Eligiblefordeduction

u/s80Candany u/s80Candany
paymentfromthe paymentfromthe
schemeshallnotbe schemeshallnotbe
liabletotax. liabletotax.

Section80DDBDeductionincaseofvery Rs.60,000/ Rs.80,000/ Rs.80,000/

seniorcitizens(>80years)onexpenditureon
accountofspecifieddiseases

Section80DDBDeductionincaseof Rs.40,000/(<60 Rs.40,000/(<60 Rs.40,000/(<60

expenditureonaccountofspecifieddiseases years) years) years)

Rs.60,000/(>60 Rs.60,000/(>60 Rs.60,000/(>60

years) years) years)

Section80DDMaintenance,includingmedical Rs.50,000/ Rs.75,000/ Rs.75,000/

treatmentofadependentwhoisapersonwith
disability

Section80DDMaintenance,includingmedical Rs.1,00,000/ Rs.1,25,000/ Rs.1,25,000/

treatmentofadependentwhoisaperson
withseveredisability

Section80UPersonwithdisability Rs.50,000/ Rs.75,000/ Rs.75,000/

Section80UPersonwithseveredisability Rs.1,00,000/ Rs.1,25,000/ Rs.1,25,000/

Section80CCCContributiontoprovidentfund Rs.1,00,000/ Rs.1,50,000/ Rs.1,50,000/

ofLICorIRDAapprovedinsurer

Section80CCDContributionbytheemployee Rs.1,00,000/ Rs.1,50,000/ Rs.1,50,000/

toNationalPensionScheme(NPS)
Now under Section Now under Section
80CCD, a deduction of 80CCD, a deduction of
upto Rs. 50,000 is uptoRs.50,000isallowed
allowedoverandabove overandabovethelimitof
thelimitofRs.1.50lakh Rs. 1.50 lakh under
under Section 80C in Section80Cinrespectof
respect of contributions contributionsmadetoNPS
made to NPS is also is also allowed. Thus,
allowed.Thus,nowthe now the total deduction
total deduction that can thatcanbeclaimedunder
be claimed under Section 80C+Section
Section 80C+Section 80CCD=Rs2lakh.
80CCD=Rs2lakh.

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1/20/2017 LatestIncomeTaxSlabsandRatesforFY201617andAY201718
In case any employer
In case any employer
contributes to the NPS
contributes to the NPS
scheme on behalf of the
schemeonbehalfofthe
employee and the benefit
employee and the
of the same would be
benefit of the same
availed by the employee,
wouldbeavailedbythe
the employee would also
employee, the
be allowed a deduction
employeewouldalsobe
under Section 80CCD(2)
allowed a deduction
for the amount of
under Section
contribution made by the
80CCD(2) for the
employer.
amount of contribution
madebytheemployer.

WealthTaxHasbeenAbolishedintheBudgetfor201516

Changesthatwereeffectedfromearlieryears,i.e.,theFY201415(AY201516)

Investmentlimitundersection80CoftheIncomeTaxActraisedfromRs.1lakhtoRs.1.5lakh.

DeductionlimitonaccountofinterestonloaninrespectofselfoccupiedhousepropertyraisedfromRs.1.5lakhtoRs.2lakh.

PersonalIncometaxexemptionlimitraisedbyRs50,000/thatis,fromRs.2lakhtoRs.2.5lakhinthecaseofindividualtaxpayers,belowtheage
years.

[ClickHeretoseetheIncomeTaxSlabRatesforFY201516orA

[ClickHeretoseetheIncomeTaxSlabRatesforFY201314orA

[ClickHeretoseetheIncomeTaxSlabRatesforFY201213orA

ImportantRulesforfilingofTaxReturn
1.Filingofincometaxiscompulsoryforallindividualswhosegrossannualincomeexceedsthemaximumamountwhichis
notchargeabletoincometax(e.g.Rs.3,00,000forSeniorcitizens,Rs.2,50,000/forresidentindividuals)

2.ThelastdateforfilingofincometaxreturnisusuallyJuly31forindividuals(sometimesthesameisextended).
AdsbyGoogle
3.Consequencesfornonfilingincometaxreturn:(i)Youwillbeissuednoticeu/s142(1)fornonfilingofincometaxreturnif
theincometaxdept.(ii)Lossesifanyduringtheyear,wouldnotbeallowedtocarryforward.Normally,ifyoufileyourreturn
ontimelossesofthisyearcanbesetoffagainstgainofforthcomingyears.(iii)APenaltyofRs.5,000/maybeimposed
undersection271Fifbelatedreturnissubmitted.(iv)Interestu/s234Aattherateof1%permonth/partofthemonthwould
becharged.

(1)DeductionsfromTaxableIncome(Section80C):

VARIOUSINVESTMENTSOPTIONSAVAILABLETOINDIVIDUALSANDTAXBENEFITS
AVAILABLEUNDEREACHOFTHEMFinancialYear201617
Anewsection80Cwasintroduced(replacingsection88)fromthefinancialyear200506.UnderthisSection,adeduction
ofuptoRs.1,50,000/(wefFY201415)isallowedfromTaxableIncomeinrespectoftheinvestmentsmadeinsome
specifiedschemes.TheschemesaresimilaraswereavailableinSection88earlier.Nowtherearenosectoralcapsand
individualscansaveinanyoftheschemesuptoRs.1,50,000/(noweveninPPFitisalloweduptoRs.1.50lacasagainstonly
Rs.1lakhuptoMarch2014)..Thetaxpayerscanplantheirinvestments/savingssoastoachievetheirfinancialgoals.The
detailsofsuchschemesalongwithsomemajorfeaturesofeachofthesearegivenbelow:

(lastreviewedinApril,2016)

Sec.under Taxbenefitsfor Lockin

whichTax ReturntillMarch ReturnfromApril earnings(i.e. Periodand
SavingScheme
Benefit 31,2016 1,2016 interestreceived/ other
available dividendreceived) Remarks
5years
(reducedwef
Dec2011
from6years
to5yearsfor
new
8.10%forVIII
8.50%forVIII investments).
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1/20/2017 LatestIncomeTaxSlabsandRatesforFY201617andAY201718
NationalSaving Series5YearNSCs Series5YearNSCs Theyieldon
Certificates(NSC Section80C and8.80%for10 and10yearNSCs Taxable theseNSCs
scheme) yearNSCsforFY havebeen willnowbe
201516 discontinuedfrom revisedevery
April2016 yearandwill
be25bps
abovethe5
year
government
bondyields
EquityLinked Variesfromyearto Variesfromyearto
SavingsSchemes Section80C year(Market year(Market Dividendistaxfree3years
(ELSS) linked) linked)
Variesfrom
LifeInsurance Variesfromyearto Variesfromyearto Variesfrom
Section80C schemeto
Policies year year schemetoscheme
scheme
Variesfrom
UnitLinked
Variesfromyearto Variesfromyearto Variesfrom schemeto
InsurancePlan Section80C
year year schemetoscheme scheme(15to
(ULIP)
20years)
Variesfromissuetoissue.These
werearound8%+inDec
InfrastructureBonds(NO 2011.Thesehavelosttheir
LONGERAVAILABLEFOR Section80C charmasAdditionalTax Same Taxable 3to5years
FRESHINVESTMENT) rebateofRs20,000isNOT
givennowfromFY201213
onwards.
Till
retirement
ContributiontoEPF 8.75%onEPFfor 8.8%onEPFfor
Interestearnedis (loansare
/GPF/Voluntary Section80C 201314(announced 201617(announced
taxfree permitted
PF inAugust2013) inApril2016)
onlyafter5
years)
Earningsaretax
Lockedtill
InsurancePolicies Section80C 6to7%only 6to7%only
freeinmostofthe
maturity
cases
Partial
Earningsaretax
ULIPS Section80C Marketlinked Marketlinked withdrawal
free
allowed
15yearsand
extendable.
Withdrawals
allowedafter
7years.
YieldonPPF
PublicProvident 8.70%forFY2015 8.10%forFY2016 Interestearnedis
Section80C willvaryand
Fund(PPF) 16 17 taxfree
willbefixed
at25basis
pointabove
the10year
government
bonds.
Withdrawal
Interestearnedis notpermitted
NPS Section80C MarketLinked MarketLinked
taxfree before
maturity
TuitionFees
includingadmission
feesorcollegefees
Not
paidforfulltime Section80C Notapplicable Notapplicable Notapplicable
applicable
educationofany
twochildrenofthe
assessee.
Repaymentof
Not
HousingLoan Section80C Notapplicable Notapplicable Notapplicable
applicable
(Principal)
BankTaxSaving Variesfrombankto Variesfrombankto
FixedDeposits Section80C bank(around7.50% bank(around7.00% Taxable 5Years
Schemes5Years 8.75%) 8.00%)
Asperthe
guidelines
issuedin
December
SeniorCitizens 2011,there
SavingsScheme 9.30%forFY2015 8.60%forFY2016 willbespread
Section80C Taxable
2004(fromfinancial 16 17 of100basis
year200708) pointsabove
the5year
bondsyields
forthis
scheme.
PostOfficeTime
DepositAccount 8.50%forfiveyear 7.90%forfiveyear
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1/20/2017 LatestIncomeTaxSlabsandRatesforFY201617andAY201718
(fromfinancial2007 Section80C TimeDeposit TimeDeposit Taxable
08)

PSNote:Nowsomeoftheaboveinvestments(likePPFand5YearSeniorCitizensSavingSchemesetc.)arelinkedtothebenchmarkof10year/5Yeargovernmentbondy
thusthereturnontheseinvestmentswillvaryasandwhentheyieldongovernmentbondschanges.Therefore,nowrememberthatyouwillnothavefixedrateofreturnonthe
investments.Ontheotherhand,forotherSmallSavingschemesGoIwilladvisebefore1stAprileveryyear,theratesapplicableforthoseschemesforthenextFY.Suchinstru
continuetohavesamereturnforthewholetenureoftheinvestment.[Forclarificationseebelowthenotificationwhichisselfexplanatory]

DeductionsAllowedInSectionsBeyond80C:
(1)DeductionsUnderSection80CCC(1):
Underthissection,thecontributionsbyindividualstowards"Pension"schemesofLICoranyotherInsurancecompany,isallowedasdeductionofRs.10,000/.However,aspro
section80CCE,theaggregatedeductionu/s80C,andu/s80CCCand80CCDcannotexceedRs.1,50,000/.Thuseffectively,nowthesearecoveredunderthemaximumlim
Rs.1,50,000/undersection80C.

(2)DeductionsUnderSection80D:
BasicDeductionunderSection80D,MediclaimpremiumpaidforSelf,SpouseordependantchildrenhasnowbeenraisedtoRs25,000wefFY201516.

ThedeductionforseniorcitizensisraisedfromRs20,000toRs30,000.Foruninsuredsuperseniorcitizens(morethan80yearsold)medicalexpenditureincurredupt
shallbeallowedasadeductionundersection80D.However,totaldeductionforhealthinsurancepremiumandmedicalexpensesforparentsshallbelimitedtoRs30,000

However,thereareafewconditions:

Youcannotclaimtaxbenefitonhealthinsurancepremiumpaidforyourinlaws

Proofofpaymentofpremiumhastobefurnished,inordertoavailthetaxbenefit

Thehealthinsurancepremiummustbepaidfromtaxableincomeofthatyearonlyifyouwanttoclaimadeduction.Thus,ifonehaspaidthepremiumfromon
orfromgiftsofmoneyreceived,thenoneisnoteligiblefortaxbenefitsunderthissection.

However,youhavetorememberthatthepremiumpaidbyanymodeofotherthancashiseligible.Notepriorto1stApril2009,premiumpaymentwasrequiredtob
bycheque.However,noweventhepaymentsthroughCreditcardorotheronlinemechanismareallowed.Thus,nowallpaymentmodesexceptcashpaymentareac

(3)DeductionsUnderSection80E:

Underthissection,deductionisavailableforpaymentofinterestonaloantakenforhighereducationfromanyfinancialinstitutionoranapprovedcharitableinstitution.Theloansho
foreitherpursuingafulltimegraduateorpostgraduatecourseinengineering,medicineormanagement,orapostgraduatecourseinappliedscienceorpurescience.

LoanshouldhavebeentakenforthepurposeofpursuinghigherstudiesofIndividual,Spouse,ChildrenofIndividualorofthestudentofwhomindividualislegalGu
Educationloantakenforsiblings(brother/sister)orotherrelatives(inlaws,nephew,niece,etc.)wouldnotqualifyforsection80Ebenefit.

The amount of interest paid is eligible for deduction and moreoverthere is no cap on the amountto be deducted. You can deduct the entire interest a
from your taxable income. However there is no benefit available on the repayment of principal amountof the loan. Deduction shall be allowed in co
the total income in respect of the initial assessment year* and seven assessment years immediately succeeding the initial assessment year or until the
paid by the assessee in full, whichever is earlier. The tax benefits on education loan are only valid once you start the repayment and moreover they a
available up to eight years. For instance if your loan tenure exceeds eight years, you cannot claim for deductions beyond eight years.

(4)DeductionsUnderSection24(b):
Underthissection,interestonborrowedcapitalforthepurposeofhousepurchaseorconstructionisdeductiblefromtaxableincomeuptoRs.2,00,000/isdeductiblefromincom
conditionsaretobefulfilled)

Wehaveseenthattheprincipalamountintherepaymentofahomeloancanbeaddedtothe80ClimitofRs1.5lakhfortaxsavings.However,theinterestcomponentofhome
allowedasdeductionunderSection24BforuptoRs2lakhincaseofaselfoccupiedhouse.Incasethehouseisinthejointnameofyourspouseandyou(jointloan),eachone
Rs2lakhinterestcomponentdeduction.Thislimitisonlyforselfoccupiedhouse.Ifyouhavepropertywhichisrentedout,youcandeductthefullinterestpaidonthehomelo
onthepropertydoesbecomepartofyourincome.Iftherentislesserthantheloaninterest,itwillloweryouroveralltaxliability.

PS:1A)Section80CCF:InfrastructureBonds:(NOTPERMITTEDFROMFY201213)onwards):

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1/20/2017 LatestIncomeTaxSlabsandRatesforFY201617andAY201718
Section80CCFallowedyoutoinvestanadditionalRs.20,000ininfrastructurebonds,andsuchaninvestmentwasreducedfromyourtaxableincomeinadditiontoth
Rs.100,000deductionyougetfromtheotherinstrumentslistedabove.Youweretogetthetaxbenefitonlyintheyearinwhichyouhaveinvestedintheseinstruments
THISISNOTALLOWED.

TAXFREEINCOMES:
Someoftheincomesarecompletelyexemptedfromincometaxandthattoowithoutanyupperlimit.Thefollowingincomeswhicharetaxfree:

(a)InterestonEPF/GPF/PPF

(b)InterestonGOITaxFreeBonds/TaxFreeBondsissuedwithspecificstipulationtothiseffect

(c)DividendsonSharesandMutualFunds.Dividendincomefromcompanies/EquityOrientedMutualfundsiscompletelyexemptinthehandsofinvestors.Dividen
taxfreeinthehandsofinvestorsincaseofdebtorientedMutualFundschemes.(However,theAssetManagementCompanyisliabletodeduct22.44%distributionta
nonindividuals/nonHUFinvestorsand14.025%incaseofindividualsorHUFinvestors.)

(d)CapitalreceiptsfromLifeInsurancepoliciesi.e.sumsreceivedeitherondeathoftheinsuredoronmaturityofLifeinsuranceplans.However,incaseoflifeinsura
policiesissuedafterMarch31,2004,exemptiononmaturitypaymentu/s10(10D)isavailableonlyifpremiumpaidinanyyeardoesnotexceed20%ofthesumasssure

e)InterestonSavingBankaccountsinbanksuptoRs10,000/peryear(fromFY201213onwards)

(f)Longtermcapialgainsonsaleofsharesandequitymutualfundsafter01/10/2004,ifsecuritytransactionispaid/imposedonsuchtransactions.

GIFTTAX:
GifttaxwasabolishedwitheffectfromOctober1,1998.Thegiftsarenolongertaxableinthehandsofdonorordonee.However,w.e.f.September1,2004,anygiftr
anindividualorHUFwillbeincludedintaxableincome,iftheamountoftaxexceedsRs.25,000/.However,giftsreceivedfromanyofthefollowingwillcontinuetor
free:

(i)Spouse

(ii)Brotherorsister

(iii)Brotherorsisterofthespouse

(iv)Brotherorsisterofeitheroftheparentsoftheindividual

(v)Anylinealascendantordescendantoftheindividual

(vi)Anylinealascendantordescendantofthespouseoftheindividual

(vii)spouseofthepersonreferredtoin(2)or(6)orreceivedontheoccasionofmarriageorunderawillbywayofinheritance

CapitalGains:
CapitalgainsarisewhenanindividualsellsataprofitcertainassetslikepropertyorsharesormutualfundsorbondsetcThetreatmentofsuchincomeisnotthesam
incomefromothersources.Therearetwotypesofcapitalgains,vizShortTermCapitalGainsorLongTermCapitalGains.

(a)ShortTermCapitalGains:CapitalgainisconsideredasShortTermCapitalGain,ifimmovablepropertyissold/transferredwithinthreeyearsofacquiringthesame.Sim
sharesorotherfinancialsecuritiessuchasmutualfundsaresoldwithinoneyearofpurchase,theprofitearnedistreatedasShortTermCapitalGain.

Shorttermcapitalgainisincludedinthegrosstaxableincomeandnormaltaxratesareapplicable.However,w.e.f.1stOctober,2004,theshorttermcapitalgainsfromsaleof
sharesorunitsofequityorientedmutualfundschemesaretaxedonlyataflatrateof10%,irrespectiveofthetaxslabonothersourcesofincome,providedsecuritiestransactio
paidonsuchsale.

(b)LongTermCapitalGains:CapitalgainisconsideredastheLongTerm,iftheimmovablepropertyissoldafterthreeyearsfrompurchse,orfinancialsecurtiessuchasshare
discountbonds,unitsofopenendedorcloseendedschemesofmutaulafundsaredisposed(i.e.sold/redeemed/transferred)afterholdingthesameformorethantwelvemont
thegainisconsideredtobelongtermcapitalgain.

Longtermcapitalgainsontransferoflistedshares/unitsofequityorientedmutualfundsschemeshasbeenexemptedfromtaxw.e.f.1stOctober,2004,providedsecuritiestran
taxhasbeenpaidonsuchsale.Forassetsotherthanthelistedshares/unitsofmutualfundsschemes,taxispayableinrespectoflongtermcapitalgainsataflatrateof20%an
amountofgainhastobeadjustedforinflationthroughindexationbenefit.

Longtermcapitalgainstaxinrespectofbondsanddebtsecuritiesordebtorientedmutualfundschemeslistedonstockexchangesispayableataflatrateof10%ofthecapital
amount.Incaseanindividualwishestoavailthebenefitsofindexation,thentaxhastobepaidatnormallongtermcapitalgainstaxrateof20%.

Section54ECoftheITAct,1961:RelieffromCapitalGainsTax
YoucanmakegooduseofthisSectiontosaveTaxesspeciallywhenyousellsomeproperty.TheIncomeTaxlawsprovidesfortaxesonlongtermcapitalgainsat20perce
for individuals and foreign firms and 30 per cent for domestic companies. However, Section 54EC of the IT Act, 1961, provides relief from capital gains tax. Under th
Section, gains on transfer of a longterm capital asset can be exempted from tax if the money is invested in bonds of specified institutions such as NABARD, the Ru
ElectrificationCorporation(REC),SIDBIortheNationalHighwayAuthorityofIndia.Suchbondsareredeemableafterthreeyears.However,tosavetax,youhavetoinve

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1/20/2017 LatestIncomeTaxSlabsandRatesforFY201617andAY201718
inthesebondswithinsixmonthsfromthedateoftransferoftheoriginalasset.Thusinvestinginthesebondswilleffectivelymeanthatyourmoneyislockedinforthreeyears.
youwanttobuyanewpropertyoneortwoyearsaftertransferringtheoriginalasset,youwillhavetoeitherwaitorlookforalternativefunds.Afterthelockinperiodoront
maturityofthebonds,theinvestorisfreetoputinhismoneyinanykindofasset.However,theinterestonthebondistaxable.

Ontheotherhand,StateBankofIndia,offersSBICapgainsPlusSchemewherelockinperiodisabsent,aslightlyhigherinterestratecomparedtothecapitalgaintaxsavi
bondsisoffered.TheproceedsofthesaleofthecapitalassetcanbeparkedinthefixeddepositschemeundertheCapgainsPlusplanataninterestratemarginallyhigherth
whatbondsunderSection54ECwouldfetch.Theinterestearnedwillbetaxedatprevailingrates.However,unlikethebondsunder54EC,thedepositorcannotputthemon
inadifferentkindofasset.Theplanstipulatesthatreinvestmentshouldbemadeonthespecifiedassetonly.Therefore,thisschemeisaboonforpeoplewhohavesoldth
propertybuthaven'tbeenabletopurchasethepropertywithinthestipulatedperiod.Onceafinaldecisionistakenonthepropertyyouwanttoreinvestin,youcanoptfor
exitfromSBIPlan,butyouwillneedtogetacertificateofconsentfromtheassessmentofficer.

ClickHeretoViewPreviousYears(Last10years)IncomeTaxSlab/RatesinIndia
*******

LatestCircularsRegardingRateofInterestonSmallSavingsetc.

RBICIRCULARFORRATEOFINTERESTONPPFandSCSS2004Schemes
RBI/201415/536
IDMD(DGBA).CDD.No.4521/15.02.001/201415

April01,2015

Madam/DearSir,

RevisionofinterestratesforSmallSavingsSchemes

PleaserefertoourcircularRBI/201112/359datedJanuary20,2012regardinginterestratesonsmallsavingsschemes,whereinitwasindicatedthatasperGovernmentsdecisionon
interestonsmallsavingsschemes,theinterestratesonvarioussmallsavingsschemesforeveryfinancialyearwillbenotifiedbytheGovernmentbeforeApril01stofthaty

2.TheGovernmentofIndiahavevidetheirOfficeMemorandum(OM)No.6/01/2011NS.IIdatedMarch31,2015,advisedtherateofinterestonvarioussmallsavingsschemesforthef
201516.Accordingly,theratesofinterestonPPF1968,SCSS2004,KisanVikasPatra&SukanyaSamriddhiAccountSchemeforthefinancialyear201516,effectivefromApril01,2
basisoftheinterestcompounding/paymentbuiltinintheschemes,willbeasunder:

Rateof
Scheme
RateofInterestw.e.f.01.04.2014(Old RateofInterestw.e.f. Interest
rates) 01.04.2015 w.e.f.
01.04.2016
5yearSCSS,2004 9.20%p.a 9.30%p.a 8.60%p.a
PPF,1968 8.70%p.a 8.70%p.a 8.10%p.a
KisanVikasPatra 8.70%p.a 8.70%p.a 7.80%p.a
SukanyaSamriddhiAccountScheme 9.10%p.a 9.20%p.a 8.60%p.a

3.ThecontentsofthiscircularmaybebroughttothenoticeofthebranchesofyourbankoperatingthePPF1968,SCSS2004,KisanVikasPatra&SukanyaSamriddhiAccountSch
shouldalsobedisplayedonthenoticeboardsofyourbranchesforinformationofthesubscriberstotheseSchemes.

Yoursfaithfully

(ShrikantHamine)
Manager

RevisionofInterestRatesforSmallSavingsSchemesfortheFinancialYear201617Announced

VariousdecisionstakenbytheGovernmentofIndiaontherecommendationsoftheShyamalaGopinathCommitteeforComprehensiveReviewofNationalSm
Fund(NSSF),werecommunicatedtoallconcernedbytheGovernmentthroughitsOfficeMemorandumdated11thNovember,2011.
OneofthedecisionsoftheGovernmentbasedontherecommendationsoftheCommitteerelatestorevisionofinterestrateseveryfinancialyear,tobenot
1stAprilofthatyear.AccordinglywiththeapprovaloftheFinanceMinister,theratesofinterestonvarioussmallsavingsschemesfortheFinancialYear201617eff
01.04.2016,onthebasisoftheinterestcompounding/paymentbuiltinintheschemes,shallbeasunder:


Scheme OldRateofinterest Old Rate of RateofInterest
w.e.f.01.04.2014 Interest w.e.f.01.04.2016
w.e.f.01.04.2015
1. 2. 3. 4.
SavingsDeposit 4.0 4.00 4.00

1YearTimeDeposit 8.4 8.40 7.10
2YearTimeDeposit 8.4 8.40 7.20
3YearTimeDeposit 8.4 8.40 7.40
5YearTimeDeposit 8.4 8.50 7.90
5YearRecurring 8.40 8.40 7.40
Deposit
5YearSCSS 9.20 9.30 8.60
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1/20/2017 LatestIncomeTaxSlabsandRatesforFY201617andAY201718
9.30 8.60
5YearMIS 8.40 8.40 7.80
5YearNSC 8.50 8.50 8.10
10YearNSC 8.80 8.80 DISCONTINUED
PPF 8.70 8.70 8.10

Sukanya Samriddhi 9.10 9.20 8.60
AccountScheme

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