A

STUDY ON

TAX SAVING SCHMES

AT

SBI

A Project report submitted to Osmania University

In partial fulfillment for the Award of the Degree of

MASTER OF BUSINESS ADMINISTRATION

Submitted by

D. ALEKYA

HT NO: 2121-20-672-115

UNDER THE GUIDANCE OF

--------------------------------------------

ARISTOTLE PG COLLEGE
(AFFLIATED TO OSMANIA UNIVERSITY,HYDERABAD)
RECOGNIZED BY UGC UNDER SECTION 2(F) OF UGC ACT 1956
BESIDE MOINABAD POLICE STATION,
CHILKUR, MOINABAD ,RANGA REDDY DISTRICT, TELANGANA.
2020-2022
 CHAPTER-I
INTRODUCTION

TAX SAVING Act, 2021 governs the taxation of incomes generated within India and of
incomes generated by Indians overseas. This study aims at presenting a lucid yet simple
understanding of taxation structure of an individual’s income in India for the assessment year
2019-20.

TAX SAVING Act, 2061 is the guiding baseline for all the content in this report and the tax
saving tips provided herein are a result of analysis of options available in current market.
Every individual should know that TAX SAVING in order to avail all the incentives provided
by the Government of India under different statures is legal.

This project covers the basics of the TAX SAVING Act, 2061 as amended by the Finance
Act 2007, and broadly presents the nuances of prudent TAX SAVING and tax saving options
provided under these laws. Any other hideous means to avoid or evade tax is a cognizable
offence under the Indian constitution and all the citizens should refrain from such ac
TAX SAVING
TAX SAVING has been described as a refined form of ‘tax avoidance’ and implies
arrangement of a person’s financial affairs in such a way that it reduces the tax liability. This
is achieved by taking full advantage of all the tax exemptions, deductions, concessions,
rebates, reliefs, allowances and other benefits granted by the tax laws so that the incidence of
tax is reduced. Exercise in TAX SAVING is based on the law itself and is therefore legal and
permanent.
Example: Mr. A having other income of Rs. 200,000/- receives income of Rs. 50,000/- from
Mr. B. Mr. A to save tax deposits Rs. 60,000/- in his PPF account and saves the tax of Rs.
12,000/- and thereby pays no tax on income of Rs. 50,000.
Tax Management
Tax Management is an expression which implies actual implementation of TAX SAVING
ideas. While that TAX SAVING is only an idea, a plan, a scheme, an arrangement, tax
management is the actual action, implementation, the reality, the final result.
Example: Action of Mr. A depositing Rs. 60,000 in his PPF account and saving tax of Rs.
12,000/- is Tax Management. Actual action on TAX SAVING provision is Tax Management.

To sum up all these four expressions, we may say that:

 Tax Evasion is fraudulent and hence illegal. It violates the spirit and the letter of the law.
 Tax Avoidance, being based on a loophole in the law is legal since it violates only the
spirit of the law but not the letter of the law.
 TAX SAVING does not violate the spirit nor the letter of the law since it is entirely based
on the specific provision of the law itself.
 Tax Management is actual implementation of a TAX SAVING provision. The net result
of tax reduction by taking action of fulfilling the conditions of law is tax management.

The TAX SAVING Equation

For the understanding of any layman, the process of computation of income and tax liability
can be outlined in following five steps. This project is also designed to follow the same.
 Calculate the Gross total income deriving from all resources.
 Subtract all the deduction & exemption available.
 Applying the tax rates on the taxable income.
 Ascertain the tax liability.
 Minimize the tax liability through a perfect planning using tax saving scheme
 CHAPTER-II

REVIEW OF LITERATURE

DEDUCTIONSFROM TAXABLE INCOME

Deduction under section 80C
This new section has been introduced by the finance Act, 2005. Under this section, a
deduction of up to Rs. 1,50,000 is allowed from Taxable Income in respect of investments
made in some specified schemes. The specified schemes are the same which were there in
section 88 but without any sectoral caps (except in PPF).
80C

 This section is applicable from the assessment year 2006-2007.Under this section
100%deduction would be available from Gross Total Income subject to maximum ceiling
given u/s 80CCE.

Following investments are included in this section:

 Contribution towards premium on life insurance

 Contribution towards Public Provident Fund.(Max.70,000 a year)
 Contribution towards Employee Provident Fund/General Provident Fund
 Unit Linked Insurance Plan (ULIP).
 NSC VIII Issue
 Interest accrued in respect of NSC VIII Issue
 Equity Linked Savings Schemes (ELSS).
 Repayment of housing Loan (Principal).
 Tuition fees for child education.
 Investment in companies engaged in infrastructural facilities.  
Notes for Section 80C

1. There are no sectoral caps (except in PPF) on investment in the new section and the
assessee is free to invest Rs. 1,50,000 in any one or more of the specified instruments.
2. Amount invested in these instruments would be allowed as deduction irrespective of
the fact whether (or not) such investment is made out of income chargeable to tax.
 3. Section 80C deduction is allowed irrespective of assessee income level. Even persons
with taxable income above Rs. 10,00,000 can avail benefit of section 80C.
4. As the deduction is allowed from taxable income, the exact savings in tax will depend
upon the tax slab of the individual. Thus, a person in 30% tax slab can save TAX
SAVING up to Rs. 30,600 (or Rs. 33,660 if annual income exceeds Rs. 10,00,000) by
investing Rs. 1,00,000 in the specified schemes u/s 80C.

Deduction under section 80CCC

Deduction in respect of contribution to certain Pension Funds:

Deduction is allowed for the amount paid or deposited by the assessee during the previous
year out of his taxable income to the annuity plan (JeevanSuraksha) of Life Insurance
Corporation of India or annuity plan of other insurance companies for receiving pension
from the fund referred to in section 10(23AAB) 

Deduction under section 80CCD

Employee’s contribution – sec 80CCD (1)

Is allowed to an individual who makes deposits to his/her pension account.

Maximum deduction allowed is 10% of salary (in case the taxpayer is an employee) or 20%
of gross total income (in case the taxpayer being self- employed) or 1,50,000, whichever is
less.

FY 2016-2017 and earlier years – in the case of a self – employed individual allowed is 10%
of gross total income.

Deduction under section 80GG

Deduction for House Rent Paid Where HRA is not Received
a. This deduction is available for rent paid when HRA is not received. The taxpayer, spouse
or minor child should not own residential accommodation in the location where he/she is
employed.
b. The taxpayer should not have self occupied residential property in any other place
c. Taxpayer must be living on rent and paying rent.
d. The deduction is available to all individuals.
Deduction available is the least of the following:
a. Rent paid minus 10% of adjusted total income
 b. Rs. 5000/- per month
c. 25% of adjusted total income
From FY 2016-17 available deduction has been raised to Rs. 5,000 a month from Rs. 2,000
per month.
Deduction under section 80E
Deductions for interest on Education Loan for Higher Studies
A deduction is allowed to an individual for interest on loan taken for pursuing higher
education.
This loan may have been taken for taxpayer, spouse or children or for a student for whom the
taxpayer is a legal guardian. The deduction is available for a maximum of 8 years (beginning
the year in which the interest starts getting rapid) or till the entire interest is rapid, whichever
is earlier. There is on restriction on the amount that can be claimed.
Deduction under section 80EE
Deductions on Home Loan Interest for First Time Home Owners
FY 2017-19 and FY 2016-17 This deduction is available in FY 2017-19 if loan has been
taken in FY 2016-17. The deduction under this section is available only to an individual who
is a first time home- owner. The value of the property purchased must be less than Rs. 50
lakh and the home loan must be less than 35 lakh. The loan must be taken from financial
institution and must have been sanctioned between 01 April 2016 to 31 March 2017. Through
this section, an additional deduction of Rs. 50,000 can be claimed on home loan interest. This
is in addition to deduction of Rs. 2,00,000 allowed under section 24 of the income tax Act for
a self-occupation house property.

Deduction under section 80U

Deduction for Person suffering from Physical Disability
A Deduction of Rs 75,000 is available to a resident individual who suffers from a physical
disability (including blindness) or mental retardation. Deduction of Rs. 1,25,000 can be
claimed. From FY 2015-16 – The deduction limit of Rs. 50,000 has been raised to Rs. 75,000
and Rs. 1,00,000 has been raised to Rs. 1,25,000.
 CHAPTER-III

RESEARCH METHODOLOGY

NEED FOR THE STUDY

Tax saving schemes, is the guiding baseline for all the content in this report and the tax

saving tips provided herein are a result of analysis of options available in current market.

Every individual should know that tax planning in order to avail all the incentives provided

by the Government of India under different statures is legal.

This project covers the basics of the Tax saving schemes, as amended by the Finance Act,

2019 and broadly presents the nuances of prudent tax planning and tax saving options

provided under these laws. Any other hideous means to avoid or evade tax is a cognizable

offence under the Indian constitution and all the citizens should refrain from such acts.

SCOPE OF THE STUDY

1) The project studies the TAX SAVING for individual assessed to TAX SAVING.

2) The Study relates to non-specific and generalized TAX SAVING, eliminating the

need of sample/population analysis.

3) Basic Methodology implemented in this study is subjected to various pros & cons

and diverse insurance plans.

4) This study covers individual TAX SAVING assessor’s only and does not hold

good for corporate tax payers.

5) The tax rates, insurance plans, and premium are all subjected to FY 2020-2021
OBJECTIVE OF THE STUDY

1) To The main objective is to reduce tax liability by showing deductions, exemptions and
rebate admissible under the ACT.

2) To Tax savings does not violate the spirit nor the letter of the law is legal since it is
entirely based on the specific provision of then law itself.

3) To The Study relates to non-specific and generalized TAX SAVING, eliminating the need
of sample/population analysis.

4) To This study may include comparative and analytical study of more than one tax saving
plans and instruments.

5) To measured by the provision of enacted tax laws. Other events not Yet recognized in the
financial statements may affect the eventual tax consequences of some events that have been
recognized in the financial statements.
 RESEARCH METHDOLOGY

DATA COLLECTION

Primary Data:-

Primary research entails the use of immediate data in determining the for stable all tax
system. Primary data is more accommodating as it shows latest information. The site ministry
of finance , TAX SAVING reports data on quarterly/ monthly/ half yearly/ annually
respectively.

Secondary Data:-

Whereas Secondary research is means to reprocess and reuse collected information as an

indication for betterment of service or product. In this data related to a past period. As tax
consultant I collected data of my project form work in chartered Accountants office related
to different department are handle like TAX SAVING ,auditing tax consultant, audit report
etc.. List of customer for advisory, tax details, fee structure etc. Data is collected from past
record that means history and I collected the data for TAX SAVING for the tax payer.

Tools of Analysis

TAX SAVING Tools

Following are the TAX SAVING tools that simultaneously help the assesses maximize their
wealth too.
Here are some guidelines to help you wade through the various options and ensure the
following:
 
1. Tax is saved and that you claim the full benefit of your section 80C benefits
2. Product are chosen based on their long term merit and not like fire fighting options
undertaken just to reach that Rs 1 lakh investment mark
3. Products are chosen in such a manner that multiple life goals can be fulfilled and that
they are in line with your future goals and expectations
 4. Products that you choose help you optimise returns while you save tax in the
immediate future.
LIMITATIONS OF THE STUDY

1. This project studies the TAX SAVING for individuals assessed to TAX SAVING.

2. The study relates to non-specific and generalized TAX SAVING, eliminating the need of

sample/population analysis.

3. Basic methodology implemented in this study is subjected to various pros & cons, and

diverse insurance plans at different income levels of individual assesses.

4. This study may include comparative and analytical study of more than one tax saving

plans and instruments.

5. This study covers individual TAX SAVING assesses only and does not hold good for

corporate taxpayers.
 CHAPTER-IV
COMPANY PROFILE
STATE BANK OF INDIA

Not only many financial institution in the world today can claim the antiquity and majesty of
the State Bank Of India founded nearly two centuries ago with primarily intent of imparting
stability to the money market, the bank from its inception mobilized funds for supporting
both the public credit of the companies governments in the three presidencies of British India
and the private credit of the European and India merchants from about 1860s when the Indian
economy book a significant leap forward under the impulse of quickened world
communications and ingenious method of industrial and agricultural production the Bank
became intimately in valued in the financing of practically and mining activity of the Sub-
Continent Although large European and Indian merchants and manufacturers were
undoubtedly thee principal beneficiaries, the small man never ignored loans as low as Rs.100
were disbursed in agricultural districts against glad ornaments. Added to these the bank till
the creation of the Reserve Bank in 1935 carried out numerous Central – Banking functions.
Adaptation world and the needs of the hour has been one of the strengths of the Bank, In the
post depression exe. For instance – when business opportunities become extremely restricted,
rules laid down in the book of instructions were relined to ensure that good business did not
go post. Yet seldom did the bank contravenes its value as depart from sound banking
principles to retain as expand its business. An innovative array of office, unknown to the
world then, was devised in the form of branches, sub branches, treasury pay office, pay
office, sub pay office and out students to exploit the opportunities of an expanding economy.
New business strategy was also evaded way back in 1937 to render the best banking service
through prompt and courteous attention to customers.

A highly efficient and experienced management functioning in a well defined organizational

structure did not take long to place the bank an executed pedestal in the areas of business,
profitability, internal discipline and above all credibility.
A impeccable financial status consistent maintenance of the lofty traditions if banking an
observation of a high standard of integrity in its operations helped the bank gain a pre-
eminent status. No wonders the administration for the bank was universal as key
functionaries of India successive finance minister of independent India Resource Bank of
governors and representatives of chamber of commercial showered economics on it.

Modern day management techniques were also very much evident in the good old day’s years
before corporate governance had become a puzzled the banks bound functioned with a high
degree of responsibility and concerns for the shareholders. An unbroken records of profits
and a fairly high rate of profit and fairly high rate of dividend all through ensured
satisfaction, prudential management and asset liability management not only protected the
interests of the Bank but also ensured that the obligations to customers were not met. The
traditions of the past continued to be upheld even to this day as the State Bank years itself to

Evolution of SBI:

The State Bank of India has its roots in since 1906 with the establishment of bank of Calcutta.
Later as years went by bank received its charter and it was redesigned as Bank of Bengal.
Furthermore Bank of Bombay, Bank of Madras evolved in 1940 and 1943 respectively.

All three Presidency banks were incorporated as joint stock companies. The Presidency banks
amalgamated on 27 January 1921, and the reorganized banking entity took as its
name Imperial Bank of India. Pursuant to the provisions of the State Bank of India Act
(1955), the Reserve Bank of India, which is India's central bank, acquired a controlling
interest in the Imperial Bank of India. On 30 April 1955 the Imperial Bank of India became
the State Bank of India.

In the year 1959 SBI took over 8 state owned banks It is headquartered in Mumbai, India and
The Corporate Centre is in Mumbai and 14 Local Head Offices and 57 Zonal Offices are
located at important cities spread throughout the country. It employs about 189,205 people.

State Bank of India has an extensive administrative structure to oversee the large network of
branches in India and abroad. The Corporate Centre is in Mumbai and 14 Local Head Offices
and 57 Zonal Offices are located at important cities spread throughout the country. State
Bank of India has 157 foreign offices in 32 countries across the globe.
State Bank of India has seven associate banks and State Bank of Saurashtra merged into SBI
on August 2008 and now the bank has six associate banks. They are; State 1. Bank of Bikaner
and Jaipur

CHAPTER-V

CHAPTERIZATION
CHAPTERIZATION
CHAPTER-1
INTRODUCTION
CHAPTER-2
REVIEW OF LITERATURE
CHAPTER-3
RESEARCH METHODOLOGY
 NEED OF THE STUDY
 OBJECTIVES OF THE STUDY
 SCOPE OF THE STUDY
 DATA COLLECTION
 LIMITATIONS OF THE STUDY
CHAPTER-4
INDUSTRY PROFILE
COMPANY PROFILE
CHAPTER-5
DATA ANALYSIS
CHAPTER-6
FINDINGS
CHAPTER-7
SUGGESTION & CONCLUSION
BIBLIOGRAPHY
ANNEXURES