Personal Tax Planning

• Example: 6
An employee who is 40 percent disabled earns Rs. 75000 P M salary (Basic +DA) and Rs.
10000 HRA P M. He is also earning Rs. 5000 PM as professional charges from other
organisations (Section 44ADA). He paid Rs. 200 per month as professional tax.
His investment for the financial year as follow:
Life Insurance: Rs. 3000 P M, and Term Insurance Rs. 20000 P A
PPF Rs. 4000 P M
Medical insurance for Self and dependent Rs. 32000
Sukanya samriddi scheme Rs. 3000 P M
Premium paid towards approved pension scheme Rs. 3000 P M
ELSS Rs. 5000 P M
NSC Rs. 6000
Group Insurance Rs. 250 PM
He is paying Rs 20000 housing loan for his residential house which consists of 65
percent interest. He also paid Rs. 30000 tuition fees for his children’s. He contributed
Rs. 3000 to CRY a recognised trust. He invested Rs. 50000 in a new company IPO and Rs.
25000 in secondary market. He also spends Rs. 70000 for medical treatment of one of
his handicapped dependent with 80 percent disability in the current year. His employer
deducts Rs. 2500 P M as TDS. Compute his tax liability for the assessment year 2018-19.
• Example: 7
A 61 year old private sector employee’s Rs 107000 P M as salary.
His salary consists of Rs. 50000 basic, Rs. 30000 D A, Rs. 20000 HRA, Rs. 5000 Travelling allowance, and Rs. 2000 medical
allowance. He earns Rs. 10000 PM as consultancy charges from other organisations. He paid Rs. 200 per month as
professional tax.
His investment for the financial year as follow:
Life Insurance: Rs. 2500 P M, and Term Insurance Rs. 25000 P A
PPF Rs. 2000 P M
Medical insurance for Self and dependent Rs. 35000
ULIP Rs. 2500 P M
Premium paid towards Central Government’s Pension Scheme Rs. 3000 P M
ELSS Rs. 5000 P M
NSC Rs. 20000 PA
Group Insurance Rs. 250 PM
He is paying Rs 22000 PM housing loan for his residential house which consists of 60 percent interest. He is repaying his
children’s education loan, for which he pays Rs. 120000 PA including Rs. 30000 interest. He contributed Rs. 3000 to
CRY a recognised trust and Rs. 10000 to prime Ministers Relief Fund. He purchased Rs. 50000 worth shares in
secondary market. He also spends Rs. 80000 for medical treatment of one of his handicapped dependent with 40
percent disability in the current year. His employer deducts Rs. 5000 P M as TDS. Compute his tax liability for the
assessment year 2018-19.