Income Tax Provisions for the Financial Year ending 31st March 2009 and Tax Benefits from लाइफ इंश्योरेंस.
(A) Income Tax Rates for FY 2008-09:
I) For any individual other than referred to in Item no II and III below.
| Total Income Range | Tax Rates | Surcharge | Education Cess (% of I.T) | Secondary and Higher Education Cess |
| Upto Rs.1,50,000/- | Nil | Nil | Nil | Nil |
| Rs.1,50,001- Rs. 3,00,000 | 10% of the amount by which the total Income exceeds Rs.1,50,000 | Nil | 2% | 1% |
| Rs.3,00,001- Rs. 5,00,000 | Rs.15,000 + 20%of amount by which the total Income exceeds Rs.3,00,000 | Nil | 2% | 1% |
| Above Rs. 5,00,000 | Rs.55,000 + 30% of amount by which the total Income exceeds Rs.5,00,000 | Nil | 2% | 1% |
(II) In case of resident women below 65 years of age.
Total Income Range | Tax Rates | Surcharge | Education Cess (% of I.T) | Secondary and Higher Education Cess |
| Upto Rs.1,80,000/- | Nil | Nil | Nil | Nil |
| Rs.1,80,001- Rs. 3,00,000 | 10% of the amount by which the total Income exceeds Rs. Rs.1,80,000 | Nil | 2% | 1% |
| Rs.3,00,001- Rs. 5,00,000 | Rs.12,000 + 20% of amount by which the total Income exceeds Rs.3,00,000 | Nil | 2% | 1% |
| Above Rs. 5,00,000 | Rs.52,000 +30% of amount by which the total Income exceeds Rs.5,00,000 | Nil | 2% | 1% |
(III) In case of Senior citizens (above 65 years of age)
Total Income Range | Tax Rates | Surcharge | Education Cess (% of I.T) | Secondary and Higher Education Cess |
| Upto Rs.2,25,000/- | Nil | Nil | Nil | Nil |
| Rs.2,25,001- Rs. 3,00,000 | 10% of the amount by which the total Income exceeds Rs. Rs.2,25,000 | Nil | 2% | 1% |
| Rs.3,00,001- Rs. 5,00,000 | Rs.7,500 +20% of amount by which the total Income exceeds Rs.3,00,000 | Nil | 2% | 1% |
| Above Rs. 5,00,000 | Rs.47,500 +30% of amount by which the total Income exceeds Rs.5,00,000 | Nil | 2% | 1% |
Surcharge on Income-tax :
Will be levied at the rate of 10% where the taxable income exceeds Rs. 10 Lakh.
Education Cess:
Will be levied at the rate of two percent on the amount of Income tax and surcharge (if any).
Secondary and Higher Education Cess :
An additional surcharge, called the “Secondary and Higher Education Cess at the rate of one percent of income-tax and surcharge (not including the “ Education Cess on Income-tax”) shall be levied in all cases.
(B) Tax Benefits available for various Life Insurance plans.
The aggregate amount of deduction under all the relevant sections viz. section 80C, section 80CCC and section 80CCD shall not, exceed
Rs.1 Lakh..
1) Deduction from Income for payment of Premium (Sec. 80C).
(a) Life Insurance premia:
The insurance premia paid for a policy is eligible for deduction. The premium paid should not be in excess of 20% of capital sum assured.
(b) Contribution to Deferred Annuity Plans :
The premia paid for a Deferred Annuity , provided such contract does not contain a provision to exercise an option by the insured to received a cash payment in lieu of the payment of annuity is eligible for deduction.
(c) Contribution to Pension/Annuity Plans :
Contribution to New Jeevan Dhara-I and New Jeevan Akshay-V Schemes of LIC are qualified for rebate under this section.
2) Income tax exemption on Maturity/Death Claims proceeds under Section 10(10D)
All the benefits payable under a Life Insurance policy are tax free. However in cases the premium paid in excess of 20% of the capital sum assured within a year, benefits paid excess of premiums will be taxable. The benefits from a key man Insurance policy and any sum received under Sec 80DD, Sub-section (3) are also taxable.
3) Jeevan Nidhi Plan & New Jeevan Suraksha - I Plan (U/s. 80CCC)
Amounts paid from the taxable income to premiums of the above annuity are deductible.
4) Deduction under section 80D
Medical Premium paid for a Health Insurance policy is deductible to the extent of Rs. 15000 for an assessee and/or his family members’ policiy/s. A separate exemption to the extent of Rs. 15,000 for premiums paid for an assessee’s parents is also available. If any one or both of the parents are Senior citizens, then an enhanced exemption limit of Rs. 20,000 is available.
Section 80D also covers payment of premium exclusively for Critical Illness Rider.
5) Jeevan Aadhar Plan (Sec.80DD)
Premium paid for LIC’s Jeevan Aadhar Plan (for the maintenance of an handicapped dependent) is eligible for deduction from the total income to the extent of Rs.50,000 and to the extent of Rs.75,000/- where handicapped dependent is suffering from specified severe disability.
6) Exemption in respect of commutation of pension under Jeevan
Suraksha & Jeevan Nidhi Plans. (Section 10(10A):
