6 Replies to “If my income is Rs.306500 how should i compute tax or how much should i invest to so that tax become Zero?”

  1. Just think of it.
    If only every citizen thinks like you
    what will happen to the exchequer
    no tax revenue
    country will become poor
    you become rich at the cost of the nation
    is this patriotism

    save reasonably
    pay the tax reasonably

    this is what the Govt. wants from every responsible citizen

    I will very strongly advise you to save only up to the 1 lakh under 88 C

    and pay the tax for the rest of the income
    & take a Pan No.

    have a clear conscience and be a proud Indian

    this is what I do.

    If you still want to save to make you tax zero,

    there are umpteen no of CAs waiting for people like you


  2. With the current tax structure, income tax above certain amount can not be zero, since maximum benefit allowed is on 100000 investmet only. If you have firther investment it will not be counted.

    Cosidering your income and investmet of 100000, in 80 CC ( public provident fund, LIC, infrastructure bonds etc ) your tax liability is 64058.00

  3. As your income is bigger so the tax have to be paid.Of course it can’t be zero but you can minimise it by investing in the items mentioned in sec 80C , the maximum deduction you can claim is 100000/-

    Now you are income is 306500
    If you don’t invest anywhere and no other income except the above then your tax payable including surcharge and education cess is 42789/-

    If you invest in accordance to Sec 80C then maximum deduction will be 1lac, so that your net income will be reduced by 1lac and it will be 206500.
    Tax payable for AY 2006-07 on 206500 including sc and ec is 16626/-

    Following are the different items where you can invest to get a maximum deduction of 1 lac u/s 80 C
    1.LIC insurance premium (including payment made by govt employees to the central govt employees’ insurance scheme and payment made by a person under children ‘s defered endowment assurance policy){subject to a maximum of 20% of sum assured}
    2.Amount deposited as term deposit for a period of5 years or more accordance with a scheme framed by the govt (applicable from Assessment year 2007-2008)
    3.Payment in respect of non-commutableDeffered annuity plan
    4.Any amount paid as tuition fee (not including any payment towards development fees/donation/payment of similar nature) whether at the time of admission or otherwise to any university/college/educational institutions in india for full time education
    5.Salary deducted by employer (incase of Govt employee)6.contribution to Statutory provident fund and RPF.
    7.contribution towards 15yrs PPF
    8.contribution towards approved superannuation fund.
    9.Subscription to National Savings Certificate VIII issue.
    10.contribution for participating in the ULIP of UTI
    11.contribution for participating in the ULIP of LIC mutual fund
    12.Payment for notified annuity plan of LIC or any other insurer.
    13.Subscription towards notified units of Mutual Fund or UTI
    14.contribution to notified pension fund set up by Mutual fund or UTI (i.e retirement benefit pension fund of UTI)
    15.Any sum paid including accrued interest as subscription to home loan account scheme of the National Housing Bank or contribution to any notified pension fund set uo by the national housing Bank.
    16.Any sum paid as subscription to any scheme ofa> public sector company engaged in providing long term finance for purchase/construction of residential house in India.b> housing board constituted in India for the purpose of planning, development or improvement of cities/towns.
    17.Any amount towards the cost of purchase/construction of aresidential property (including repayment of loan taken from Govt. bank, cooperative bank,LIC,National Housing Bank,assessee’s employer where such an employer is a public company/public sector company/university/co-operativ… society)
    18.amount invested in approved debentures of, and equity shares in, a public company engaged in infrastructure including power sector or units of amutual fund proceeds of which are utilised for the developing, maaintaining,etc of a new infrastructure facility

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