Investment Guidelines - FY 2016-17

Rent Receipts:
Please provide one receipt per quarter (April to June (1 receipt), July to September (1 receipt),
October to December (1 receipt) and January to March (1 receipt) along with a letter specifying
that the rent amount for that period remained the same. Rent receipts must state name of
tenant, name of landlord, PAN of landlord, address of the property, amount of rent, concerned
month and receivers signature on the revenue stamp.

Note: - If you are paying rent of more than Rs. 8,333/- per month (more than Rs. 1,00000/- per

year) and claiming HRA benefit. This is compulsorily to furnish the Permanent account
number (PAN) of the landlord to your employer in order to claim the HRA benefit. In case
of PAN not available then land lord can provide the declaration to tenant along with
address proof i.e. Aadhar Card, Rashan card, copy of electricity bill, copy of water bill etc.

Please mention Rent amount clearly on the rent receipt, whether the paid amount is
monthly / Quarterly to avoid the confusion

A. U/S 80C (MAXIMUM LIMIT IS RS. 150000/- INCLUDING PF + VPF)

LIC:

Please submit photocopies of all premium receipts paid from April 16 till the date of submission,
attested by the employee. In case any premium is due after December 31, 2016, please provide
us with the receipt of the last year, along with copy of the policy and declaration.

If the same is not possible then provide us the last receipt paid for the same policy along with a

declaration stating that the premium for the same will be paid by the due date (latest by
March 6, 2017) and in case of any default the tax along with the interest, if any, may be
deducted from your salary for March-17.
PPF:

Please submit photocopies of deposited Challans and PPF Passbook with copy of
the covering page attested by the employee.

NSC:

Please submit photocopies of all NSC certificates purchased in the current year
and NSCs purchased in the last 5 years (if any) attested by the employee.

ACCURED INTEREST OF NSC:

NSC interest declared will also be accounted as Other Income and taxed.
Proofs to be submitted: Photocopy of all the certificates for which interest is being
claimed. Calculation of Interest.
NSC calculator is given with the supporting forms to calculate the Accrued Interest of NSC

ULIP:
Please submit photocopies of all premium receipts attested by the employee.

Deposit Under Senior Citizens Saving Schemes:

Eligible only if the employee is a Sr. Citizen. Sr.Citizen is a person who shall attain 60
st
years in current financial year i.e. till 31 March 2017, as per Income Tax Act
Bond should be of the current financial year only (Apr 16 Mar 17) Policy should
specify that benefit eligible u/s senior citizen saving scheme
Mutual funds (ELSS Schemes):

Please submit photocopies of acknowledgement of application and final

certificate/statement attested by the employee. If certificate/statement is not received so
far, then please submit the bank statement showing the payment of the same.

MF/ ELSS can be claimed only for investment made for self. MF / ELSS investments made in
the name of parents (father / mother / both) or in-laws including spouse & children are not
eligible for deduction under section 80C.

Children Tuition Fees:

Please submit receipts of tuition fees paid in original. If original receipts are not available
then photocopies should be attested by the school and the stamp of the school should be
visible.

Only Tuition fee will be allowed and any other fee will be disallowed like development fee,
Transport fee etc.

Play School / Pre Nursery Tuition fee will also be allowed

Child education allowance exemption will also be provide on the basis of tuition
fee proof received
Rs. 100 per child per month (max upto 2 children)

Fixed Deposit:

Please submit receipt of fixed deposit made for 5 years or more than 5 years. Please
ensure that to claim the rebate, the details should be clearly mentioned in the FD rebate
u/s 80C with stamped.
FD should be cover up under the tax sever scheme

Housing Loan Principal Repayment:

Please provide Current Year Housing Loan Provisional Certificate clearly stating that the
Interest & principal breakup and the Maximum deduction allowed is Rs.150000 per annum.
Stamp Duty and Registration Charges: The amount you pay as stamp duty when you
buy a house and the amount you pay for the registration of the documents of the house
can be claimed as deduction under section 80C in the year of purchase of the house.
Validations:

Certificate should be in the name of employee.

Only bank statement is not valid proofs. Interest provisional certificate to be submitted.

Certificate should provide the breakup of Interest & Principal paid during the Financial Year 16-17.

Principal amount paid during the current financial year.

In case of Joint Loan, please provide the declaration form stating the claiming percentage.

Sukanya Samriddhi Yojana (for Girl Child) The government issued a notification to allow
80C exemption equal to the amount invested in the scheme up to Rs. 1,50,000, which is

also the maximum amount one can invest in this scheme in a financial year

B. U/S 80D - MEDICAL INSURANCE PREMIUM (MAX EXEMPTION RS

25000/- FOR SELF/ SPOUSE / CHILDREN)

Please submit photocopies of the receipt of premium paid which should be attested by the
employee.

Mediclaim policy is taken on the health of the taxpayer, on the health of spouse, dependent
Parents or dependent children of the taxpayer. In case of HUF on the
health of any member of the Family and General Deduction up to Rs. 25,000/- (i.e.,
individual, spouse & dependent children) plus Rs. 25000/- (i.e., Parents of the taxpayer
whether dependent or not). So, total up to Rs. 50000/-will be allowed. In case of Senior
Citizen, an additional amount of Rs. 5000/-, which is deductible when policy is taken on the
health of a senior citizen (i.e., resident in India & 60 years or more)

Only Current Financial Proofs will be allowed, if the premium due is after the cut-off date
then please submit the last year receipt with declaration

Only Self / spouse /children and dependent parents proofs will be allowed and age to be
specified in the proofs.
Late fees or any other penalties and Service Tax will not to be considered.

Preventive Health checkup benefits will be allowed maximum up-to Rs. 5,000/- within the
maximum limit of 80D.

Note: Please do not enter your Health Insurance amount / Medical Insurance Amount which is part
of your FBP.

C. U/S 80E REPAYMENT OF INTEREST ON EDUCATION LOAN

Please submit Interest Provisional Certificate of payment from bank / Institution providing the
details of education loan, only interest amount will be considered from Financial/Charitable institution
for self or dependent full time higher education for a Maximum period of 8 years. Actual interest
amount will be considered for interest on education loan benefit, there is no any limit.

Notes on 80E:

Further, the deduction shall be allowed for the financial year in which the assesse starts
repaying The loan or interest thereon and seven financial years immediately succeeding it or
until the loan together with interest thereon is paid by the assesse in full, whichever is earlier.

Dependent means Spouse & children of individual.

Higher education means full-time studies for any graduate or post-graduate course in
engineering, medicine, management or for post-graduate course in applied science or
pure sciences including mathematics and statistics.
Any Part time or correspondence courses will not be allowed

D. U/S 24 - INTEREST ON HOUSING LOAN OR LOSS / INCOME FROM HOUSE

PROPERTY:
Self-Occupied: Capped to a maximum of Rs.2, 00,000/- P.A and

Please submit provisional statement/certificate with EMI break-up categorized into

interest and the principal component. Also please ensure that relevant possession
proof documents should be accompanied with the bank certificate, under possession
proof, one can submit Electricity bills / Water bill / Maintenance receipt / Property tax
receipt paid to municipal authority
House Property should be the name of the employee
In case of Joint loan, declaration specifying the % of benefit claimed by the individual

Photocopy of Sale Deed and Stamp Duty Paid Receipt pertaining to current
financial year (Apr16 Mar17)

In case of Joint loan, declaration specifying the % of benefit claimed by the

individual
You can claim only one house property in case of self-occupied.

You can claim only one benefit either Rent or Interest if property in the
same location or place

Only One self-occupied property is considered for tax benefit on

interest paid. If multiple properties, claim only one under self-occupied
and rest under let out.

Let out Property (Loss or Income): No limit, Interest to be calculated after

considering the let out property.

Provisional certificate pertaining to current financial year (Apr 16 Mar

17) with breakup of interest and principle from the Housing Finance
Company / Bank.
House property Should be in the name of the employee

Provide the Calculation of Income from a Let-Out property

If you have a multiple let out property then provide a single calculation of all
the let out properties.
Let out Property calculator is attached with supporting form for reference

E. 80EE Income Tax Benefits on Interest on Home Loan (First Time Buyers)
Additional Tax Benefits of Rs. 50000/- to first time home buyers (if the following
conditions are satisfied). This scheme was introduced for financial year 2013-14
and was available for 2 years, FY 2013-14 and FY 2014-15 only (assessment year
2014-15 and 2015-16).
However, this section has been reintroduced effective FY 2016-17 (assessment year
2017-18).
Any benefit availed in previous financial year under this section, will be reduced
from the limit of Rs. 50000/-.

1. Loan should be sanctioned between 1st Apr16 to 31st Mar17

2. The amount of loan sanctioned for residential house property should not
exceed of Rs. 35,00,000/3. The value of residential house property should not exceed Rs.
50,00,000/4. The Assessee should not own any House property on the date of sanction
of loan

F. 80DD Maintenance / Medical Treatment of Handicapped Dependents:

Please submit the photocopy of certificate issued by the competent medical authority in a
Government Hospital, with a self-declaration, certifying amount spent on treatment, training
or rehabilitation of the handicapped dependent, or receipt of the amount paid to LIC/UTI for
the policy. Where condition of disability requires reassessment, fresh certificate to be
obtained after its expiry to continue claiming the deduction

Amount of Deduction

If the above mentioned conditions are satisfied and severe disability (less than 80
%) the amount of deduction is fixed at Rs. 75,000 irrespective of actual expenditure.

In case of a person with severe disability (over 80 %) a higher deduction of

Rs.1,25,000 shall be Allowed irrespective of actual expenditure.

Dependent Means

In case of an individual, the spouse children, parents, brothers, sisters of the

individual or any of them.

In case of HUF, a member of the HUF wholly or mainly dependent on such

individual or HUF for Support and maintenance.

Proofs Required

Certificate issued by a physician, surgeon, oculist or a psychiatrist working in

a government hospital Copy of the policy.

Actual medical bills or the receipts of the insurance paid during the financial year
on account of medical treatment for handicapped dependent.
Form-10 I A duly signed for the current fin-year 16-17
Where condition of disability requires reassessment, fresh certificate to be
obtained

after its expiry to continue claiming the deduction

G. SEC-80DDB - DEDUCTION IN RESPECT OF MEDICAL TREATMENT
Please provide the photocopy of certificate issued by the competent medical authority in
a Government Hospital, with a self-declaration, certifying amount spent on treatment,
for a specified disease like Cancer, Aids, renal failure etc.
If the above mentioned conditions are satisfied and individual is less than 60
years of age then the deduction amount of deduction would be.
a) The amount paid b) Rs. 40,000/-

Whichever is lower is deductible under Sec-80DDB.

Senior Citizen If the above mentioned conditions are satisfied and individual is more than
60 years of age then the deduction amount of deduction would be:

a) Actual Medical Expenses

b) Rs. 60,000/- (Whichever is below)

Very Sr. Citizen (80 Years and above)

a) Actual Medical Expenses

b) Rs. 80,000/- (Whichever is below)

Proof Required:
Certificate issued by a physician, surgeon, oculist or a psychiatrist working in a
government hospital Copy of the policy. (Form 10I) along with original medical bills.

This Certificate is to be obtained by all assesses claiming deduction under section

80DDB.

The certificate must be obtained from any doctor registered with the Indian Medical
Association who is having post-graduate qualifications. In other words, the doctor
must at least have M.D. qualification. Any doctor with just M.B.B.S. degree with or
without any additional diploma qualifications is not a post-graduate.

This certificate must be obtained in respect of each assessment year for

which the deduction is claimed and enclosed to the return of income for that
assessment year.
The certificate shall be from the prescribed authority in Form No. 10-I

Specified diseases and ailments for the purpose of deduction under section 80DDB:
(i) Neurological diseases
(a) Dementia
(b) Dystonia Musculorum Deformans
(c) Motor Neuron Disease
(d) Ataxia
(e) Chorea
(f) Hemiballismus
(g) Aphasia
(h) Parkinsons Disease

H. 80U - PERMANENT PHYSICAL DISABILITY INCLUDING BLINDNESS SELF

Please provide the photocopy of certificate issued by the competent medical authority in
a Government Hospital, with a self-declaration, certifying amount spent on treatment,
training or rehabilitation of the handicapped dependent, or receipt of the amount paid to
LIC/UTI for the policy. Where condition of disability requires reassessment, fresh
certificate to be obtained after its expiry to continue claiming the deduction

Amount of Deduction

If the above mentioned conditions are satisfied and severe disability (less than 80
%) the amount Of deduction is fixed at Rs. 75,000 irrespective of actual
expenditure.

In case of a person with severe disability (over 80 %) a higher deduction of

Rs.1,25,000 shall be Allowed irrespective of actual expenditure.
Proofs should have the name of the employee
He is a person with disability

Proofs Required

Certificate issued by a physician, surgeon, oculist or a psychiatrist working

in a government Hospital Copy of the policy.

Actual medical bills or the receipts of the insurance paid during the financial
year on account of Medical treatment for handicapped dependent.
Form-10 I A duly signed for the current FY 2016-17

Where condition of disability requires reassessment, fresh certificate to be

obtained
after its expiry to continue claiming the deduction

Where condition of disability requires reassessment, fresh certificate

to be obtained after its expiry to continue claiming the deduction

I. 80TTA - Interest on Saving Account (Newly Introduced)

Section 80TTA is proposed to be introduced to provide deduction to an

individual or a Hindu undivided family in respect of interest received on deposits
(not being time deposits) in a savings account held with banks, cooperative
banks and post office. The deduction is restricted to Rs 10,000 or actual interest
whichever is lower.
It is also proposed to provide that where the income referred to in this section
is derived from any deposit in a savings account held by, or on behalf of, a
firm, an association of persons or a body of individuals, no deduction shall be
allowed under this section in respect of such income in computing the total
income of any partner of the firm or any member of the association or any
individual of the body.
E.g. Total Interest is Rs. 50000/- then
50000- 10000 = 40000 will be taxable

Proof Required: copy of bank statement for the FY 2016-17 where interest
credited amount clearly mention on the statement.
Note: The remaining amount will be considered as an income also under the
head Other Income

J. NPS (New Pension Scheme)

Please provide the photocopy of all the payment receipts issued by the bank
with NPS Account Details (Tier I and Tier II)
Note: as per the section 80CCE the aggregate amount of deduction under
sections
80C, 80CCC and Section 80CCD(1) shall not exceed Rs. 1,50,000/-.
However the contribution made by the Central Government or any
other employee to a pension scheme u/s 80CCD(2) shall
be excluded from the limit of Rs.1,00,000/- provided under this Section
and the same amount will be considered as a perquisite.
Note: Please do not enter your NPS Amount which is part of your FBP.
80CCD(1B) - "NPS - Additional Deduction of Rs. 50000/- Employee
Contribution"

Please provide the photocopy of all the payment receipts issued by the bank
with NPS Account Details

K. 80CCG (Rajiv Gandhi Equity Saving Scheme)

This deduction is available only for new retail investors where an annual
income of assesse does not exceed Rs 12 lakh in the given financial year. The
investment can be made upto Rs 50,000 in the capital markets, however the
deduction will be available upto 50% of the investment.
The maximum investment permissible under the Scheme is Rs 50,000 and the
investor would get a 50 percent deduction of the amount invested from the
taxable income for that year i.e. 25000/- . To benefit the small investors, the
investments are allowed to be made in installment in the year in which tax
claims are made.

Note: Please refer the complete guidelines at the time of investment

Special Notes:
Newly inserted Section 80CCG provides deduction w.e.f. assessment
year 2013-14 in respect of investment made under notified equity saving
scheme. The deduction under this section is Available if following
conditions are satisfied:
(a)The assesse is a resident individual (may be ordinarily resident or not
ordinarily resident)
(b)His gross total income does not exceed Rs. 12 lakhs;
(c)He has acquired listed shares in accordance with a notified scheme;
(d)The assesse is a new retail investor as specified in the above notified
scheme;
(e)The investment is locked-in for a period of 3 years from the
date of acquisition in accordance with the above scheme;
(f) The assesse satisfies any other condition as may be prescribed.
Amount of deduction -The amount of deduction is at 50% of amount
invested in equity shares. However, the amount of deduction under this
provision cannot exceed Rs. 25,000. If any deduction is claimed by a
taxpayer under this section in any year, he shall not be entitled to any
deduction under this section for any subsequent year.
Withdrawal of deduction - If the assesse, after claiming the aforesaid deduction,
fails to satisfy the above conditions, the deduction originally allowed shall be
deemed to be the income of the assesse of the year in which default is
committed.
A scheme named "Rajiv Gandhi Equity Savings Scheme (RGESS)" is
being notified for the Purpose of this deduction.

L. PREVIOUS EMPLOYER SALARY

Employee who has joined the company during the financial year 2016 - 2017 i.e. after
April 01, 2016 also
needs to give the details of salary received from his previous employer in the
attached format (Form 12B) along with certified Final Tax Computation sheet /
form 16 / Tax Certificate for FY 2016-17 from the previous employer so that tax
can be deducted accordingly.

In case of first employment employee needs to give a declaration for his first
employment and will show NIL salary in the attached format (Form 12B). But
where employee has worked somewhere else and does not submit the
previous salary then his present salary will be annualized to reach at the
average rate of tax and tax will be deducted accordingly.

Please fill your previous employer income after u/s 10 exemption, previous
employer PF and Professional Tax
Form 12B is attached

Form 12B

Income Tax Slab for Financial Year 2016-17

Rate

Men

Women

Senior Citizens

Exemption limit

First 250,000 of the income in First 250,000 of the income in First 250,000 of the income in
rupees
Rupees
rupees

Income between Rs. 250,001 10% of taxable income

10% of taxable income
Exempt up till Rs. 3,00,000;
Rs. 500,000
between 250,001 500,000 in between 250,001 500,000 in 10% on Income between
rupees
Rupees
Rs.3,00,001 Rs.500,000
Income between Rs. 500,000 20% of taxable income
20% of taxable income
20% of taxable income
Rs. 10,00000
between 500,001 10,00000 in between 500,001 10,00000 in between 500,001 10,00000 in
rupees
rupees
rupees
Income > Rs. 10,00000

30% of taxable income over

10,00001 in rupees

30% of taxable income over

10,00001 in rupees

30% of taxable income over

10,00001 in rupees

Note: As per 2016 Budget(Finance Act, 2016) section 87A of the Income Tax Act, 1961
rebate of Rs.5000/- will be given to the individual tax payer whose total Income does not
exceed Rs 5 lakhs or we can say that Individual Tax Payer whose total income doesnt
exceed Rs 5 Lakhs is eligible for deduction of Rs 50000/- from income.
Note: @15% Surcharge will be applicable if the income is above Rs. 10000000/- (One
Crore)