A Quick Look At Tax Benefits and Exemption On Income Tax in Union Budget 2015-16

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There was nothing much in the Union Budget 2015-16, which will significantly benefit individual tax payers. Here are a few ways in which you may end-up paying marginally lower income tax than last year.

Benefits on Health Insurance

While benefits on health insurance premium paid gave you tax benefits to the tune of Rs 15,000 until the last year, from financial year 2015-16 you can claim tax benefits up to a sum of Rs 25,000 for health insurance premium paid.

Type of Benefit Section Amount
Complete 80C benefits including insurance premium, PPF contribution, principal amount paid on home loans etc. Sec80C Rs 1.5 lakhs
Interest on housing loan paid Sec 80CCD Rs 2.0 lakhs
Health insurance Sec 80D Rs 25,000
Transport Allowance   Rs 19,200
Total  

Rs 4.42 lakhs

Transport Allowance

The Transport Allowance which is at the moment Rs 800 commuting from home to your place of work, will get enhanced to Rs 1600. This means your employer must increase the transport allowance in your salary to give you the benefits.

A Quick Look At Tax Benefits and Exemption On Income Tax in Union Budget 2015-16
Thank God that the new government realised that it very difficult to commute in Rs 800 and the tax allowance had not been touched for years.

Health Insurance Premium For Senior Citizens

The Health Insurance Premium tax exemption for senior citizens has been raised to Rs 30,000. For very senior citizens an amount of Rs 50,000 spent on medical bills is now tax exempt.

Contribution To New Pension Scheme

Additional deduction of Rs 50,000 will be allowed for contribution to the new pension scheme u/s 80 CCD increasing from Rs 1 lakh to Rs 1.5 lakh.

These are just some of the exemptions. There are other tax benefits that one has received like investment in the Sukanya Samridhi is not free from taxes. In the sense one would get tax benefits under Sec80C and the interest income is tax exempt.

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Read more about: tax benefits, union budget 2015
Story first published: Saturday, February 28, 2015, 13:56 [IST]
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