Investment Guidelines - FY 2016-17

Rent Receipts:
Please provide one receipt per quarter (April to June (1 receipt), July to September (1 receipt), October
to December (1 receipt) and January to March (1 receipt) along with a letter specifying that the rent
amount for that period remained the same. Rent receipts must state name of tenant, name of landlord,
PAN of landlord, address of the property, amount of rent, concerned month and receivers signature on
the revenue stamp.

Note: - If you are paying rent of more than Rs. 8,333/- per month (more than Rs. 1,00000/- per
year) and claiming HRA benefit. This is compulsorily to furnish the Permanent account
number (PAN) of the landlord to your employer in order to claim the HRA benefit. In case
of PAN not available then land lord can provide the declaration to tenant along with
address proof i.e. Aadhar Card, Rashan card, copy of electricity bill, copy of water bill etc.

Please mention Rent amount clearly on the rent receipt, whether the paid amount is monthly /
Quarterly to avoid the confusion

A. U/S 80C (MAXIMUM LIMIT IS RS. 150000/- INCLUDING PF + VPF)

LIC:

Please submit photocopies of all premium receipts paid from April 16 till the date of submission, attested
by the employee. In case any premium is due after December 31, 2016, please provide us with the receipt
of the last year, along with copy of the policy and declaration.

If the same is not possible then provide us the last receipt paid for the same policy along with a
declaration stating that the premium for the same will be paid by the due date (latest by March
6, 2017) and in case of any default the tax along with the interest, if any, may be deducted from
your salary for March-17.

PPF:

Please submit photocopies of deposited Challans and PPF Passbook with copy of the covering
page attested by the employee.

NSC:

Please submit photocopies of all NSC certificates purchased in the current year and NSCs
purchased in the last 5 years (if any) attested by the employee.

ACCURED INTEREST OF NSC:

NSC interest declared will also be accounted as Other Income and taxed.
Proofs to be submitted: Photocopy of all the certificates for which interest is being claimed.
Calculation of Interest.
NSC calculator is given with the supporting forms to calculate the Accrued Interest of NSC

ULIP:

Please submit photocopies of all premium receipts attested by the employee.

Deposit Under Senior Citizens Saving Schemes:

Eligible only if the employee is a Sr. Citizen. Sr.Citizen is a person who shall attain 60
years in current financial year i.e. till 31st March 2017, as per Income Tax Act
Bond should be of the current financial year only (Apr 16 Mar 17) Policy should
specify that benefit eligible u/s senior citizen saving scheme
Mutual funds (ELSS Schemes):

Please submit photocopies of acknowledgement of application and final certificate/statement

attested by the employee. If certificate/statement is not received so far, then please submit the
bank statement showing the payment of the same.

MF/ ELSS can be claimed only for investment made for self. MF / ELSS investments made in the name
of parents (father / mother / both) or in-laws including spouse & children are not eligible for
deduction under section 80C.

Children Tuition Fees:

Please submit receipts of tuition fees paid in original. If original receipts are not available then
photocopies should be attested by the school and the stamp of the school should be visible.

Only Tuition fee will be allowed and any other fee will be disallowed like development fee,

transport fee etc.

Play School / Pre Nursery Tuition fee will also be allowed

Child education allowance exemption will also be provide on the basis of tuition fee proof
received
Rs. 100 per child per month (max upto 2 children)

Fixed Deposit:

Please submit receipt of fixed deposit made for 5 years or more than 5 years. Please ensure that
to claim the rebate, the details should be clearly mentioned in the FD rebate u/s 80C with
stamped.
FD should be cover up under the tax sever scheme

Housing Loan Principal Repayment:

Please provide Current year Housing Loan Provisional Certificate clearly stating that the Interest &
principal breakup and the Maximum deduction allowed is Rs.150000 per annum.

Stamp Duty and Registration Charges: The amount you pay as stamp duty when you buy a house
and the amount you pay for the registration of the documents of the house can be claimed as
deduction under section 80C in the year of purchase of the house.
Validations:

Certificate should be in the name of employee.

Only bank statement is not valid proofs. Interest provisional certificate to be submitted.

Certificate should provide the breakup of Interest & Principal paid during the Financial Year 16-17.

Principal amount paid during the current financial year.

In case of Joint Loan, please provide the declaration form stating the claiming percentage.

Sukanya Samriddhi Yojana (for Girl Child) The government issued a notification to allow 80C
exemption equal to the amount invested in the scheme up to Rs. 1,50,000, which is also the
maximum amount one can invest in this scheme in a financial year

B. U/S 80D - MEDICAL INSURANCE PREMIUM (MAX EXEMPTION RS 25000/- FOR SELF/
SPOUSE / CHILDREN)

Please submit photocopies of the receipt of premium paid which should be attested by the
employee.

Mediclaim policy is taken on the health of the taxpayer, on the health of spouse, dependent Parents or
dependent children of the taxpayer. In case of HUF on the health of any member of the Family and General
Deduction up to Rs. 25,000/- (i.e., individual, spouse & dependent children) plus

Rs. 25000/- (i.e., Parents of the taxpayer whether dependent or not). So, total up to Rs. 50000/will be allowed. In case of Senior Citizen, an additional amount of Rs. 5000/-, which is deductible
when policy is taken on the health of a senior citizen (i.e., resident in India & 60 years or more)

Only Current Financial Proofs will be allowed, if the premium due is after the cut-off date then
please submit the last year receipt with declaration
Only Self / spouse /children and dependent parents proofs will be allowed and age to be specified in
the proofs.
Late fees or any other penalties and Service Tax will not to be considered.
Preventive Health checkup benefits will be allowed maximum upto Rs. 5000/- within the maximum
limit of 80D.

Note: Please do not enter your Health Insurance amount / Medical Insurance Amount which is part of your
FBP.

C. U/S 80E REPAYMENT OF INTEREST ON EDUCATION LOAN

Please submit Interest Provisional Certificate of payment from bank / Institution providing the details of
education loan, only interest amount will be considered from Financial/Charitable institution for self or
dependent full time higher education for a Maximum period of 8 years. Actual interest amount will be
considered for interest on education loan benefit, there is no any limit.

Notes on 80E:

Further, the deduction shall be allowed for the financial year in which the assesse starts repaying The
loan or interest thereon and seven financial years immediately succeeding it or until the loan together
with interest thereon is paid by the assesse in full, whichever is earlier.

Dependent means Spouse & children of individual.

Higher education means full-time studies for any graduate or post-graduate course in engineering,
medicine, management or for post-graduate course in applied science or pure sciences including
mathematics and statistics.
Any Part time or correspondence courses will not be allowed

D. U/S 24 - INTEREST ON HOUSING LOAN OR LOSS / INCOME FROM HOUSE PROPERTY:

Self-Occupied: Capped to a maximum of Rs.2, 00,000/- P.A and

Please submit provisional statement/certificate with EMI break-up categorized into interest and the
principal component. Also please ensure that relevant possession proof documents should be
accompanied with the bank certificate, under possession proof, one can submit Electricity bills / Water
bill / Maintenance receipt / Property tax receipt paid to municipal authority

House Property should be the name of the employee

In case of Joint loan, declaration specifying the % of benefit claimed by the individual

Photocopy of Sale Deed and Stamp Duty Paid Receipt pertaining to current

financial year (Apr 16 Mar 17)

In case of Joint loan, declaration specifying the % of benefit claimed by the individual
You can claim only one house property in case of self-occupied.

You can claim only one benefit either Rent or Interest if property in the same location or
place

Only One self-occupied property is considered for tax benefit on interest paid. If
multiple properties, claim only one under self-occupied and rest under let out.

Let out Property ( Loss or Income) : No limit, Interest to be calculated after considering the let
out property.

Provisional certificate pertaining to current financial year (Apr 16 Mar 17) with
breakup of interest and principle from the Housing Finance Company / Bank.
House property Should be in the name of the
employee
Provide the Calculation of Income from a Let-Out property
If you have a multiple let out property then provide a single calculation of all the let out
properties.
Let out Property calculator is attached with supporting form for reference

E. 80EE Income Tax Benefits on Interest on Home Loan (First Time Buyers)
Additional Tax Benefits of Rs. 50000/- to first time home buyers (if the following conditions are
satisfied). This scheme was introduce for financial year 2013-14 and was available for 2 years, FY
2013-14 and FY 2014-15 only (assessment year 2014-15 and 2015-16).
However, this section has been reintroduced effective FY 2016-17 (assessment year 2017-18).
Any benefit availed in previous financial year under this section, will be reduced from the limit of
Rs. 50000/-.

1. Loan should be sanctioned between 1st Apr16 to 31st Mar17

2. The amount of loan sanctioned for residential house property should not
exceed of Rs. 35,00,000/3. The value of residential house property should not exceed Rs. 50,00,000/-

4. The Assessee should not own any House property on the date of
sanction of loan

F. 80DD Maintenance / Medical Treatment of Handicapped Dependents:

Please submit the photocopy of certificate issued by the competent medical authority in a Government Hospital, with a selfdeclaration, certifying amount spent on treatment, training or rehabilitation of the handicapped dependent, or receipt of the
amount paid to LIC/UTI for the policy. Where condition of disability requires reassessment, fresh certificate to be obtained
after its expiry to continue claiming the deduction

Amount of Deduction

If the above mentioned conditions are satisfied and severe disability (less than 80 %) the amount
of deduction is fixed at Rs. 75,000 irrespective of actual expenditure.
In case of a person with severe disability (over 80 %) a higher deduction of Rs.1,25,000 shall be
Allowed irrespective of actual expenditure.

Dependent means

In case of an individual, the spouse children, parents, brothers, sisters of the individual or any
of them.
In case of HUF, a member of the HUF wholly or mainly dependent on such individual or HUF
for Support and maintenance.

Proofs Required

Certificate issued by a physician, surgeon, oculist or a psychiatrist working in a government

hospital Copy of the policy.
Actual medical bills or the receipts of the insurance paid during the financial year on account of
medical treatment for handicapped dependent.
Form-10 I A duly signed for the current fin-year 16-17

Where condition of disability requires reassessment, fresh certificate to be obtained

after its expiry to continue claiming the deduction

G. SEC-80DDB - DEDUCTION IN RESPECT OF MEDICAL TREATMENT

Please provide the photocopy of certificate issued by the competent medical authority in a Government Hospital, with a
self-declaration, certifying amount spent on treatment, for a specified diseases like Cancer, Aids, renal failure

etc.
If the above mentioned conditions are satisfied and individual is less than 60 years of age then
the deduction amount of deduction would be.
a) The amount paid
b) Rs. 40,000
Whichever is lower is deductible under Sec-80DDB.
If the above mentioned conditions are satisfied and individual is more than 60 years of age

(Senior Citizen) then the deduction amount of deduction would be.

i) Actual Medical Expenses

b) Rs. 60,000

Very Sr. Citizen (80 Years and above)

i) Actual Medical Expenses

b) Rs. 80,000

Proof Required:
Certificate issued by a physician, surgeon, oculist or a psychiatrist working in a government hospital Copy
of the policy. (Form 10I) along with original medical bills.

This Certificate is to be obtained by all assesses claiming deduction under section 80DDB.

The certificate must be obtained from any doctor registered with the Indian Medical Association who
is having post-graduate qualifications. In other words, the doctor must at least have M.D.
qualification. Any doctor with just M.B.B.S. degree with or without any additional diploma
qualifications is not a post-graduate.
This certificate must be obtained in respect of each assessment year for which the deduction is
claimed and enclosed to the return of income for that assessment year.
The certificate shall be from the prescribed authority in Form No. 10-I

Specified diseases and ailments for the purpose of deduction under section 80DDB:
(i) Neurological diseases
(a) Dementia
(b) Dystonia Musculorum Deformans
(c) Motor Neuron Disease
(d) Ataxia
(e) Chorea
(f) Hemiballismus
(g) Aphasia
(h) Parkinsons Disease

H. 80U - PERMANENT PHYSICAL DISABILITY INCLUDING BLINDNESS SELF

Please provide the photocopy of certificate issued by the competent medical authority in a Government Hospital, with a selfdeclaration, certifying amount spent on treatment, training or rehabilitation of the handicapped dependent, or receipt of the
amount paid to LIC/UTI for the policy. Where condition of disability requires reassessment, fresh certificate to be obtained
after its expiry to continue claiming the deduction

Amount of Deduction

If the above mentioned conditions are satisfied and severe disability (less than 80 %) the amount
Of deduction is fixed at Rs. 75,000 irrespective of actual expenditure.
In case of a person with severe disability (over 80 %) a higher deduction of Rs.1,25,000 shall be
Allowed irrespective of actual expenditure.
Proofs should have the name of the employee
He is a person with disability

Proofs Required

Certificate issued by a physician, surgeon, oculist or a psychiatrist working in a government

Hospital Copy of the policy.
Actual medical bills or the receipts of the insurance paid during the financial year on account of
Medical treatment for handicapped dependent.
Form-10 I A duly signed for the current FY 2016-17

Where condition of disability requires reassessment, fresh certificate to be obtained

after its expiry to continue claiming the deduction

Where condition of disability requires reassessment, fresh certificate to be

obtained after its expiry to continue claiming the deduction

I. 80TTA - Interest on Saving Account (Newly Introduced)

Section 80TTA is proposed to be introduced to provide deduction to an individual or a Hindu undivided family in respect of
interest received on deposits (not being time deposits) in a savings account held with banks, cooperative banks and post office.
The deduction is restricted to Rs 10,000 or actual interest whichever is lower.

It is also proposed to provide that where the income referred to in this section is derived from any deposit in a
savings account held by, or on behalf of, a firm, an association of persons or a body of individuals, no deduction
shall be allowed under this section in respect of such income in computing the total income of any partner of
the firm or any member of the association or any individual of the body.
E.g. Total Interest is Rs. 50000/- then
50000- 10000 = 40000 will be taxable
Proof Required: copy of bank statement for the FY 2016-17 where interest credited amount clearly mention on the
statement.

Note: The remaining amount will be considered as an income also under the head Other Income

J. NPS (New Pension Scheme)

Please provide the photocopy of all the payment receipts issued by the bank with NPS Account Details (Tier I and Tier II)
Note: as per the section 80CCE the aggregate amount of deduction under sections
80C, 80CCC and Section 80CCD(I) shall not exceed Rs. 1,50,000/-. However the contribution made by the Central
Government or any other employee to a pension scheme u/s 80CCD( II ) shall
be excluded from the limit of Rs.1,00,000/- provided under this Section and the same amount will be considered as a
perquisite.

Note: Please do not enter your NPS Amount which is part of your FBP.

80CCD(1B) - "NPS - Additional Deduction of Rs. 50000/- Employee Contribution"

Please provide the photocopy of all the payment receipts issued by the bank with NPS Account Details

K. 80CCG (Rajiv Gandhi Equity Saving Scheme)

This deduction is available only for new retail investors where an annual income of assesse does not exceed
Rs 12 lakh in the given financial year. The investment can be made upto Rs 50,000 in the capital markets,
however the deduction will be available upto 50% of the investment.

The maximum investment permissible under the Scheme is Rs 50,000 and the investor would get a 50
percent deduction of the amount invested from the taxable income for that year i.e. 25000/- . To benefit
the small investors, the investments are allowed to be made in installment in the year in which tax
claims are made.
Note: Please refer the complete guidelines at the time of investment
Special Notes:
Newly inserted Section 80CCG provides deduction w.e.f. assessment year 2013-14 in respect of
investment made under notified equity saving scheme. The deduction under this section is
Available if following conditions are satisfied:
(a) The assesse is a resident individual (may be ordinarily resident or not ordinarily resident)
(b) His gross total income does not exceed Rs. 12 lakhs;
(c) He has acquired listed shares in accordance with a notified scheme;
(d) The assesse is a new retail investor as specified in the above notified scheme;
(e) The investment is locked-in for a period of 3 years from the date of acquisition in
accordance with the above scheme;
(f) The assesse satisfies any other condition as may be prescribed.
Amount of deduction -The amount of deduction is at 50% of amount invested in equity shares.
However, the amount of deduction under this provision cannot exceed Rs. 25,000. If any
deduction is claimed by a taxpayer under this section in any year, he shall not be entitled to
any deduction under this section for any subsequent year.

Withdrawal of deduction - If the assesse, after claiming the aforesaid deduction, fails to satisfy
the above conditions, the deduction originally allowed shall be deemed to be the income of the
assesse of the year in which default is committed.
A scheme named "Rajiv Gandhi Equity Savings Scheme (RGESS)" is being notified for the
Purpose of this deduction.

L. PREVIOUS EMPLOYER SALARY

Employee who has joined the company during the financial year 2016 - 2017 i.e. after April 01, 2016 also
needs to give the details of salary received from his previous employer in the attached format (Form 12B)
along with certified Final Tax Computation sheet / form 16 / Tax Certificate for FY 2016-17 from the
previous employer so that tax can be deducted accordingly.

In case of first employment employee needs to give a declaration for his first employment and will
show NIL salary in the attached format (Form 12B). But where employee has worked somewhere
else and does not submit the previous salary then his present salary will be annualized to reach at
the average rate of tax and tax will be deducted accordingly.

Please fill your previous employer income after u/s 10 exemption, previous employer PF
and Professional Tax
Form 12B is attached

Form 12B

Income Tax Slab for Financial Year 2016-17

Rate

Men

Women

Senior Citizens

Exemption limit

First 250,000 of the income in

rupees

First 250,000 of the income in

Rupees

First 250,000 of the income in

rupees

Income between Rs. 250,001

Rs. 500,000

10% of taxable income

between 250,001 500,000 in
rupees

10% of taxable income

between 250,001 500,000 in
Rupees

Exempt up till Rs. 3,00,000;

10% on Income between
Rs.3,00,001 Rs.500,000

Income between Rs. 500,000

Rs. 10,00000

20% of taxable income

between 500,001 10,00000 in
rupees

20% of taxable income

between 500,001 10,00000 in
rupees

20% of taxable income

between 500,001 10,00000 in
rupees

Income > Rs. 10,00000

30% of taxable income over

10,00001 in rupees

30% of taxable income over

10,00001 in rupees

30% of taxable income over

10,00001 in rupees

Note: As per 2016 Budget(Finance Act, 2016) section 87A of the Income Tax Act, 1961 rebate of Rs.5000/- will be
given to the individual tax payer whose total Income does not exceed Rs 5 lakhs or we can say that Individual Tax
Payer whose total income doesnt exceed Rs 5 Lakhs is eligible for deduction of Rs 50000/- from income.
Note: @15% Surcharge will be applicable if the income is above Rs. 10000000/- (One Crore)