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Posted at: Jul 17, 2017, 12:22 AM; last updated: Jul 17, 2017, 12:23 AM (IST)TAX ADVICE

Rs 30K rebate u/s 80D for senior citizens

SC Vasudeva

Tax deduction up to Rs 30,000 in each case in financial year 2015-16 was provided to those who are 60 or more for health insurance policy and for medical expenses for aged 80 or more being not covered by health insurance. Please clarify the prevalent position in the later case. Your reply dated June 5, 2017 does not cover my apprehension.

— Vishwa Nath Bhatia

Section 80D of the Income-tax Act 1961 (The Act) provides where an assessee is an individual and is a senior citizen or a very senior citizen he shall be entitled to a deduction of Rs 30,000 out of his income chargeable to tax. Further, in case an assessee being an individual incurs, out of his total income chargeable to tax, towards medical expenditure on the health of any parent (being a very senior citizen), a deduction to the extent of Rs 30,000 is allowable. The amount of deduction was increased to Rs 30,000 in case of a medical policy taken by a senior or very senior citizen by the Finance Act 2015 w.e.f. assessment year 2016-17 and the position has not changed thereafter.

Is rebate of Rs 5,000 u/s 87A for the AY 2017-18 permissible to an NRI who files a tax return? — Ravi Rana

The rebate of Rs 5,000 under Section 87A of the Act is allowable in case of a resident assessee only and is not allowable in respect of an assessee who is an NRI.

Kindly calculate tax implications of the sale of land as detailed below:

  • Land (10 biswa) purchased during 6/2003 for Rs 6.50 lakh (i/c 14% registration fee paid to the government).
  • Land likely to be sold out during the year 2017 for minimum tentative amount of Rs 25.00 lakh (excluding registration fee to be paid by the buyer).
What will be the tax liability against above sale deed whether the sale price of Rs 25.00 lakh has to be clubbed with my pension under head income from “other sources” or otherwise?  Also intimate section of IT Act & procedure & period of depositing the tax so occurred i.e. whether tax has to be deposited immediately after the sale price received?

— RK Sharma

Indexed cost of the land would be Rs 16,22,018 (6,50,000 x 272/109) on the basis of index applicable for assessment year 2018-19 i.e. financial year 2017-18. Land having been held for more than three years, long-term capital gain on the basis of sale price of Rs 25.00 lakh would work out at Rs 8,77,982. The amount of such capital gain would be taxable @20.6%. The amount of tax payable on the said basis would be Rs 1,80,864. The amount of capital gain would not be clubbed with your income from pension and other source for the purposes of charge of tax on such income. The long-term capital gain is taxable under Section 112 of the Act. The entire amount of tax payable on your total income is required to be deposited in four instalments in the financial year proceeding the assessment year. The relevant dates and proportion of tax required to be deposited is as under:  

On or before June 15: Not less than 15% of the total tax due

On or before Sept 15: Not less than 45% of  total tax due less already paid

On or before December 15: Not less than 75% of  total tax due less already paid

On or before March 15: Balance amount of tax due on total income

In case you are a senior citizen, the amount of tax can be deposited at the time of filing of return as you do not seem to have any income from business or profession.

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