Page 11 - HDFC Bank | Take the cut out of your tax cut

Medical Insurance premium paid in Total Deduction
respect of under section 80D
Age Self, spouse & Parents*
dependent children*

Self, spouse, dependent children and parents are 25,000 25,000 50,000
below 60 years
Self, spouse, dependent children are below 60 years 25,000 50,000 75,000
but parents are above 60 years
Self, spouse, dependent children and parents are 50,000 50,000 100,000
above 60 years

*(out of the permissible deduction, payment on account of preventive health check-up shall not exceed Rs. 5,000 in each case).

Example 1 -

Like Mr. Ram and Mr. Shyam join the movement of smart tax-savers and save tax the right way -
Mr. Ram, age 35 years earns Rs. 12.25 Lakhs as annual salary. He pays Rs. 35,000 towards his life insurance premium for
term plan and pension plan. He also invests in Mutual Funds through SIP, total amounting to Rs. 40,000, invests Rs. 35,000
in Fixed Deposits for a period of 5 years and Rs. 40,000 in PPF. He has also invested in a Health Plan - Self (Rs. 25,000) and
Parents Senior Citizens (Rs. 50,000).

Sec 80 C & Sec 80 D Benefits

Mr. Ram’s Salary - Rs. 12.25 lakh
Computation of Tax

A) Taxable Income without any investment = Rs 12.25 Lakhs
Tax payable on Rs.12,25,000

Tax Slab Amount earned Tax Tax Amount

Up to Rs. 2,50,000 2,50,000 Nil Nil
Rs. 2,50,001 to Rs. 5,00,000 2,50,000 5% 12,500
Rs. 5,00,000 to Rs. 10,00,000 5,00,000 20% 1,00,000

Above Rs.10,00,000 2,25,000 30% 67,500

Income Tax (i) 1,80,000
Educational Cess @ 4% on (ii) 7,200

Total Tax Liability [(i)+(ii)] 1,87,200 (A)

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*Based on Retail Loan book size (excluding mortgages). Source: Annual Reports FY 20-21 and No.1 on market capitalisation based on BSE data as on 31st Dec, 2021