Income Taxpayers can now make bigger savings, after the announcement of the Budget 2014-15 by our finance minister Mr. Arun Jaitley.
According to the Budget:
- The basic assumption limit increased up to Rs. 2.50 lakhs that were earlier Rs. 2 lakhs.
- Mr. Jaitley also increased long-term investments under Section 80C of the Income Tax Act from Rs. 1 lakh to Rs. 1.50 lakh.
- The FM also increased the tax-free cap on interest paid on housing loan from Rs. 1.5 lakh to Rs. 2 lakh.
As per the above three major announcements:
- Total savings will raise up to Rs.36050 for the individuals, whose yearly tax income is Rs. 10 Lakhs.
- The individuals, who fall under the category of taxable income of Rs. 5 lakh to Rs. 10 lakh, will save up to Rs.25750.
- Individuals, whose taxable income is between Rs.2- Rs.5 lakh will save up to Rs.15450.
In other announcements;
- The Finance Minister proposed an increment in PPF (Public Provident Fund) in one financial year. PPF is the most popular tax saving scheme.
- The PPF amount is tax-free at all three stages. The investment is eligible for tax deduction under Section 80C.
- The interest earned is also tax-free, and so are the withdrawals.
- Mr. Jaitley said that the government will forego around Rs. 22,000 crore on account of these changes.