Benefits available exclusively to Resident Persons and Indian Companies

Business or Profession

Section 35D : Amortization of certain preliminary expenses (Subject to maximum of 5% of cost of the project or capital employed, whichever is more) Incurred before commencement of business or after commencement of business in connection with extension of an undertaking (Subject to certain conditions and nature of expenditures)

Limit of exemption: Qualifying preliminary expenditure is allowable in each of 5 successive years beginning with the previous year in which the extension of undertaking is completed or the new unit commences production or operation.

This Exemption is available to Indian Company.

Section 35D : Amortization of certain preliminary expenses (Subject to maximum of 5% of cost of the project) Incurred before commencement of business or after commencement of business in connection with extension of an undertaking (Subject to certain conditions and nature of expenditures)

Limit of exemption: Qualifying preliminary expenditure is allowable in each of 5 successive years beginning with the previous year in which the extension of undertaking is completed or the new unit commences production or operation.

This exemption is available to Resident Non-corporate assesses

Section 35DD : Amortization of expenditure incurred in connection with amalgamation or demerger on or after 01.04.1999 (Subject to certain conditions)

Limit of exemption: Allowed as deduction in 5 successive years in equal installments, beginning with the previous year in which such amalgamation or demerger takes place. This exemption is available to Indian company

Section 35E : Deduction for qualifying expenditure incurred wholly and exclusively on prospecting, for certain minerals or development of a mine, etc. (Subject to certain conditions)

Limit of exemption: Qualifying expenditure is allowed as deduction in equal installments over a period of 10 years. This exemption is available to Indian Company and Resident Non-Corporate Assesses engaged in prospecting for minerals, etc.

Section 44AD : Computation of income from eligible business on presumptive basis under Section 44AD (Subject to certain conditions)

Limit of exemption: Presumptive income of eligible business shall be 8 % of gross receipt or total turnover (if turnover or gross receipt of eligible business does not exceed Rs. 2 crore).

Note: Presumptive income shall be calculated at rate of 6% in respect of total turnover or gross receipts which is received by an account payee cheque or draft or use of electronic clearing system. This exemption is available to Resident Individual, Resident HUF or Resident Partnership Firm (Other than LLP)

Section 115BA : Concessional rate of tax for domestic company if

(i) Such company has been set-up and registered on or after March 1, 2016; and

(ii) It is engaged in business of manufacturing or production of any article or thing (Subject to certain other conditions)

Limit of exemption: Income shall, at the option of such company, be computed at concessional tax rate of 25%. This exemption is available to Indian Company

Section 115BBF : Concessional rate of tax on royalty income in respect of a patent developed and registered in India. (Subject to certain conditions)

Limit of exemption: Royalty shall be taxable at the rate of 10 per cent. This limit is available to Any person resident in India

In capital gain

Section 47(iv) : Transfer of capital asset by a parent company to its wholly owned Indian subsidiary company shall not be treated as transfer .

Limit of exemption: No capital gains shall arise in the hands of holding company due to transfer of capital assets. For this exemption Transferee should be an Indian Company

Section 47(v) : Transfer of capital asset by a wholly owned subsidiary company to its Indian holding company shall not be treated as transfer (Subject to certain conditions).

Limit of exemption: No capital gains shall arise in the hands of subsidiary company due to transfer of capital assets. For this exemption Transferee should be an Indian Company

Section 47(vi) : Transfer of capital asset in a scheme of amalgamation by amalgamating company to Indian amalgamated company shall not be treated as transfer

Limit of exemption: No capital gains shall arise in the hands of amalgamating company due to transfer of capital assets. For this Transferee should be an Indian Company

Section 47(vib) : Transfer of capital asset in a scheme of merger by demerged company to Indian resulting company shall not be treated as transfer (Subject to certain conditions).

Limit of exemption: No capital gains shall arise in the hands of demerged company due to transfer of capital assets.

For this Transferee should be an Indian Company

Section 47(vii) : Allotment of shares of Indian amalgamated company to the shareholders in the amalgamating company in lieu of their amalgamation shall not be treated as transfer (Subject to certain conditions).

Limit of exemption: No capital gains shall arise in the hands of shareholders in the amalgamating company due to such amalgamation. For this Amalgamated company should be an Indian Company

Section 47(viic): Redemption of Sovereign Gold Bonds issued by RBI under Sovereign Gold Bond Scheme, 2015.

Limit of exemption: It shall not be treated as transfer. This exemption is available to Resident individual

Section 47(xa) : Conversion of preference shares into equity shares of a company

Limit of exemption: It shall not be treated as transfer this exemption is available to all the persons in Income Tax.

Section 111A: Adjustment of unutilized portion of maximum exemption limit from short-term capital arising from transfer of equity shares or units of equity oriented funds or unit of a business trust and tax on balance short-term capital gains at 15%

Limit of exemption: f total income as reduced by such short-term capital gains is below maximum exemption limit (short-fall), such short-term capital gains shall be reduced by such short-fall and tax on the balance of such capital gains shall be computed at 15%. This exemption is available to Resident Individual and HUF

Section 112: Adjustment of unutilized portion of maximum exemption limit from long-term capital and tax on balance long-term capital gains at 20%

Limit of exemption: f total income as reduced by such long-term capital gains is below maximum exemption limit (short-fall), such long-term capital gains shall be reduced by such short-fall and tax on balance of such capital gains shall be computed at 20%. This exemption is available to Resident Individual and HUF

Section 115ACA: Concessional rate of tax on long-term capital gains arising from transfer of GDRSs issued by a listed Indian company, engaged in specified knowledge based industry or service, to its employees in accordance with notified ESOP Scheme. Provided such GDRs are purchased in foreign currency (Subject to certain conditions)

Limit of exemption: Such long-term capital gains shall be taxable at 10% without allowing benefits of first and second proviso to Section 48.this exemption is available to Resident Individual Employee.

In other sources

Section 115ACA: Concessional rate of tax on dividends on GDRSs issued by a listed Indian company, engaged in specified knowledge based industry or service, to its employees in accordance with notified ESOP Scheme. Provided such GDRs are purchased in foreign currency (Subject to certain conditions)

Limit of exemption: Such dividend shall be taxable at 10%. This exemption is available to Resident Individual Employee

Section 115BBD: Concessional rate of tax on dividends declared, distributed or paid by a specified foreign company. The benefits shall be allowed only if Indian company holds 26% or more in nominal value of equity share capital of a foreign company

Limit of exemption: 15% of such dividend this exemption is available to Indian Company

Section 80C: Only resident individuals can Investment in Public provident Fund scheme, 1968 either in his own name or in the name of minor of whom he is a guardian.

Limit of exemption: Maximum deposit in PPF Rs. 1,50,000 this exemption is Available to Resident Individual

Section 80C: Investment in Senior Citizens Savings Scheme 2004 for 5 year

Limit of exemption: Max. Deduction Rs. 1,50,000 . This exemption is available to Resident individual who is 60 years of age or by a resident individual who is 55-60 years of age and retired under VRS

Section 80CCG: Amount invested by specified resident individuals, whose gross total income does not exceed Rs. 12 lakhs, in listed shares or listed units in accordance with notified scheme for a lock-in period of 3 years (Subject to certain conditions).

No deduction is allowed from Assessment Year 2018-19

Limits of exemption: Deduction of 50 % of total investment subject to maximum of Rs. 25,000 in 3 consecutive assessment years, beginning with the assessment year relevant to the previous year in which the listed shares or list units of equity oriented funds are first acquired. This exemption is available to Specified Resident Individual (New retail investors)

Section 80D:

Amount paid (in any mode other than cash) by an individual or HUF to LIC or other insurer to effect or keep in force an insurance on the health of specified person*.An individual can also make payment to the Central Government health scheme and/or on account of preventive health check-up.

* specified person means:

– In case of Individual – self, spouse, dependent children or parents

– In case of HUF – Any member thereof

Note:

1.) Deduction for preventive health check-up shall not exceed in aggregate Rs. 5,000.

2.) Payment on account of preventive health check-up may be made in cash.

3.) Within overall limit, deduction shall be allowed up to Rs. 50,000 towards medical expenditure incurred on the health of specified person provided such person is a senior citizen and no amount has been paid to effect or to keep in force an insurance on the health of such person.

4.) ‘Senior citizen’ means an individual resident in India who is of the age of sixty years or more at any time during the relevant previous year.

Limit of exemption: In case of Individual, amount paid:

a) For self, spouse and dependent children: Up to Rs. 50,000 if specified person is a senior citizen

b) For parents: additional deduction of Rs. 50,000 shall be allowed if parent is a senior citizen

In case of HUF, up to Rs. 50,000 if specified person is a senior citizen

This exemption is available to Resident Individual and HUF who is senior citizen

Section 80DD: Deduction allowed to resident Individual and HUF for:

a) Any expenditure incurred for the medical treatment (including nursing), training and rehabilitation of a dependent, being a person with disability

b) Any amount paid or deposited under an approved scheme framed in this behalf by the LIC or any other insurer or the Administrator or the specified company for the maintenance of a dependent, being a person with disability
(Subject to certain conditions).

Limit of exemption: Rs. 75,000 (Rs. 1,25,000 in case of severe disability) this exemption is available to Resident Individual and HUF

Section 80DDB: Expenses actually paid by resident individual and HUF for medical treatment of specified diseases and ailments of:

a) In case of Individual: Assessee himself or wholly dependent spouse, children, parents, brothers and sisters

b) In case of HUF: Any member of the family who is wholly dependent upon the family
(Subject to certain conditions)

Limit of exemption: Up to Rs. 40,000 (Rs. 1,00,000 in case of senior citizen). This exemption is available to Resident Individual/ HUF

Section 80GGB: Sum contributed to political party or electoral trust is allowed as deduction (Subject to certain conditions)

Limit of exemption: 100% of amount contributed (excluding contribution in cash) is allowed as deduction this exemption available to Indian company

Section 80JJAA: Deduction of additional employee cost in respect of employment of new employees.
Additional employee cost means total emoluments paid or payable to additional employees employed during the previous year. (Subject to certain other condition)

Limit of exemption: Deduction of 30% of additional employee cost. Deduction shall be allowed for first three Assessment Years including the Assessment Year relevant to previous year in which such employment is provided. This exemption is available to Assessee who is liable to tax audit under Section 44AB

Section 80PA: Producer company engaged in an eligible business of marketing, purchase or processing of agricultural produce of its members

Limit of exemption: 100% of profits for a period of 5 years from the financial year 2018-19 subject to the condition that the total turnover of company shall be less than Rs. 100 crores during the financial year. This exemption is available to Producer Company

Section 80QQB: Royalty income of resident individual – authors of certain specified category of books other than text books

Limit of exemption: Least of the following shall be exempt from tax:

a) In case of Lump sum payment – Amount of royalty income subject to maximum of Rs. 3,00,000

b) In other cases – amount of such income subject to maximum of 15% of value of books sold during the previous year.

Section 80RRB: Royalty in respect of patents registered on or after 01.04.2003 (Subject to certain conditions)

Limit of exemption: 100% of royalty subject to maximum of Rs. 3,00,000. This exemption is available to resident individual

Section 80U: A resident individual who, at any time during the previous year, is certified by the medical authority to be a person with disability [as defined under Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995]

Limit of exemption: Rs. 75,000 (Rs. 1,25,000 in case of severe disability). This exemption is available to resident individual

Section 80-IA: Indian Company developing, maintaining and operating any infrastructure facility shall be entitled to claim deduction (Subject to certain conditions).

Limit of exemption: 100% of profit for 10 consecutive AY falling within a period of 15 AY beginning with the AY in which assessee begins operating and maintaining infrastructure facility.No deduction shall be allowed to any enterprise which starts the development or operation and maintenance of the infrastructure facility on or after the 1st day of April, 2017. This exemption is available to Indian Company

Section 80-IA Indian Company formed before 30-11-2005 with majority equity participation by public sector companies to reconstruct or revive a power generating plant shall be entitled to claim deduction. Provided it begins to generate or transmit or distribute power before 31-03-2011 (Subject to certain conditions).

Limit of exemption: 100% of profit for 10 consecutive AY falling within a period of 15 AY beginning with the AY in which assessee begins operating and maintaining infrastructure facility. This exemption is available to Indian Company

Section 80-IB: Indian Company with scientific and industrial research and development as its main object and approved by prescribed authority shall be entitled to claim deductions (Subject to certain conditions).

Limit of exemption: a) 100% of profit for 5 years from the AY in which it is approved by prescribed authority (if approved before 01-04-1999)

b) 100% of profit for 10 years from the AY in which it is approved by prescribed authority (if approved after 31-03-2000 but before 01-04-2007)

This limit is available to Indian company

Section 80-IAC: Profit and gains derived by an eligible start-up from specified business on or after Assessment Year 2017-18 (subject to certain conditions)

Limit of exemption: 100% of profit for 3 consecutive assessment years out of 7 years beginning from the year in which the eligible start-up is incorporated this exemption is available to Company and LLP

In TDS

Section 193: No TDS from interest paid on debentures issued by a company in which public are substantially interested. Provided interest is paid by account payee cheque to resident individual or HUF

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 5,000 this exemption is available to Resident individual and HUF

Section 193: No TDS from interest on 8% Saving (Taxable) Bonds 2003 paid to a resident persons

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 10,000. This exemption is available to Resident persons

Section 193: No TDS from interest on 6.5% Gold Bonds, 1977, or 7% Gold Bonds, 1980

Limit of exemption: If a declaration is made that the nominal value of such bonds did not exceed Rs. 10,000 at any time during the previous year this exemption is available to Resident Individual

Section 193: No TDS from interest paid on 4.25% National Defence Bonds, 1972, 4.25% National Defence Loan, 1968, or 4.75% National Defence Loan, 1972

Limit of exemption: No TDS from interest this exemption is available to Resident Individual

Section 193: No TDS from payment of certain interest.

Limit of exemption: No TDS from payment of interest on following securities:

(a) National Development Bonds;

(b) 7 Year National Savings Certifications (IV Issue);

(c) Debentures issued by notified persons;

(d) Any security of Central or State Government;

(e) Any listed security issued by a company and held in DEMAT form;

(f) Securities beneficially owned by LIC, GIC, specified companies or any other insurer.

This exemption is available to Resident Persons

Section 194: No TDS from dividend paid by account payee cheque to resident persons.

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 2,500. However, no TDS is required in respect of dividends as referred to in section 115-O. this exemption is available to Resident person

Section 194A: No TDS from interest (other than on interest on securities) paid by a banking company, post office or co-operative bank on time deposits

Note: With effect from 01.06.2015, tax shall be deducted from interest credited or paid by a co-operative bank to its member. However, interest paid or credited by a co-operative society to its member or to any other co-operative society shall not be subject to TDS.

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 40,000

Note: a) In case of senior citizens, tax shall not be deducted if interest payment doesn t exceeds Rs. 50,000

b) With effect from 01.06.2015, time deposit shall also include recurring deposit. Therefore, tax shall be deducted from payment of interest on recurring deposit if it exceeds the threshold limit of Rs. 40,000.

c) The threshold limit of Rs. 40,000 shall be computed with reference to the income credited or paid by a banking company or co-operative society (and not by individual branch thereof) which has adopted core banking solutions (‘CBS’).

This exemption is available to resident persons

Section 194A: No TDS from interest on deposit with a post office under Senior Citizens Saving Scheme Rules, 2004

limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 50,000. This exemption is to resident persons

Section 194A: No TDS from interest other than on securities (in any other case)

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 5,000 this exemption is available to resident persons

Section 194A: No TDS from interest on compensation awarded by Motor Accident Claims Tribunal

Limit of exemption: If amount paid during the financial year does not exceed Rs. 50,000

Note:With effect from 01.06.2015, no tax shall be deducted at the time of credit of interest on compensation awarded by the Motor Accidents Claims Tribunal. This exemption is available to resident persons

Section 194A: If amount paid during the financial year does not exceed Rs. 50,000

Note: With effect from 01.06.2015, no tax shall be deducted at the time of credit of interest on compensation awarded by the Motor Accidents Claims Tribunal. This exemption is available to Resident persons

Section 194A: No TDS from interest on zero coupon bonds issued by Infrastructure Capital Co., Infrastructure Capital Fund, Public Sector Co. or Scheduled bank

Limit of exemption: If Zero Coupon Bonds are issued on or after 01-06-2005 by specified entities this exemption is available to Resident persons

Section 194A: Interest paid under any provision of Income-tax Act, 1961 or Wealth-tax Act, 1957

Limit of exemption: Entire interest is paid under the prescribed Acts. This exemption is available to Resident persons

Section 194A: Interest paid in respect of deposits under any notified scheme or Post Office deposits, Kisan Vikas Patra, NSC VIII Issue, Indira Vikas Patra, etc

Limit of exemption: If interest is earned on the prescribed deposits this exemption is available to Resident persons

Section 194C: No TDS from sum paid or payable to contractor (Subject to certain conditions)

Limit of exemption: a) if sum paid or payable to a contractor in a single payment does not exceed Rs. 30,000

b) If sum paid or payable to contractor in aggregate does not exceed Rs. 1,00,000 during the financial year.
This exemption available to Resident Contractor

Section 194C: No TDS from sum paid or payable to transport operator who is in the business of plying, hiring or leasing goods carriage

Limit of exemptions: If transporter owns 10 or less goods carriages at any time during the financial year and he furnishes a declaration with his PAN to person responsible for making payment. this exemption is available to Resident transport operator

Section 194A: No TDS from payment made by an Individual or HUF to a resident contractor for exclusively personal purposes

Limit of exemption: If payment is made for personal purpose of Individual or HUF. This exemption is available to Resident Contractor

Section 197A(1): No deduction of tax shall be made under Sections 194 and 194EE, if resident individual furnishes to the payer a written declaration in prescribed form that tax on his estimated total income of the previous year will be nil. This exemption is available to Resident Individual

Limit of exemption: No tax shall be deducted from specified payments if the sum paid does not exceed the maximum amount which is not chargeable to tax this exemption is available to Resident Individual

Section 197A(1C): No deduction of tax shall be made under Section 192A, Sections 193, 194, 194A, Section 194DA, 194-I, 194EE and 194K if resident senior citizen furnishes to the payer a written declaration in prescribed form that tax on his estimated total income of the previous year will be nil.

Limit of exemption: No tax shall be deducted from specified payments this exemption is available to Resident Individual – Senior Citizen and Super Senior Citizen

Section 194LA: No TDS from payment of compensation on compulsory acquisition of immovable property (other than Agricultural Land)

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 2.5 Lakhs this exemption is available to Resident persons

Section 194D: No TDS from insurance commission paid or payable during the financial year

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 15,000. This exemption Is available to Resident persons

Section 194DA: No TDS from sum payable under a life insurance policy (including bonus) to a resident person (w.e.f. 01-10-2014)

Limit of exemption: If amount paid or payable during financial year does not exceed Rs. 1 Lakh. This exemption is available to Resident persons

Section 194H: No TDS from payment of commission or brokerage

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 15,000. Further no tax to be deducted from commission payable by BSNL/MTNL to their PCO Franchisees. This exemption is available to Resident persons

Section 194J: No TDS from payment of professional fees, technical fees, royalty and directors remuneration

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 30,000. This exemption is available to Resident persons

Section 194-I: No TDS from payment of rent in respect of land &building, furniture or fittings or plant and machinery.

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 2,40,000 With effect from 01.06.2015, no tax shall be deducted where income by way of rent is credited or paid to a real estate investment trust in respect of any real estate asset [as referred to in section 10(23FCA)] owned directly by such trust. This exemption is to Resident persons

Section 194-IA: No TDS from payment of consideration for purchase of an immovable property (other than agriculture land)

Limit of exemption: If amount paid or payable during the financial year does not exceed Rs. 50 Lakhs this exemption is available to Resident Transferor

Section 194-IB: No TDS from payment of rent in respect of any land or building. Note: Other than the rent covered by section 194-I

Limit of exemption: If amount of rent does not exceeds Rs. 50,000 for a month or part of a month during the financial year this exemption is available to Resident Individual or HUF

Section 201: Payer shall not be deemed to be an assessee-in-default on failure to deduct or collect taxes from payment made to a resident payee (Subject to certain conditions)

Limit of exemption: If payee includes such income in its return of income, pays taxes thereon and submits a certificate to the payer in Form 26A/27BA to this effect from a Chartered Accountant. This exemption is available for the payment made to resident persons

In advance tax

Section 207(2): Exemption from payment of advance tax by a resident senior citizen or resident super senior citizen not having any income from business or profession(who is at least 60 Years of age at any time during the previous year)

Limit of exemption: Not liable to pay advance tax this exemption available to Resident Senior Citizen and Resident Super Senior Citizen

In exemptions:

Maximum amount of income which is not chargeable to Income-tax in the hands of a resident senior citizen (who is at least 60 Years of age at any time during the previous year but less than 80 Years of age on the last day of the previous year)

Limit of exemption: Rs. 3,00,000 this exemption is available to Resident Senior Citizen

Maximum amount of income which is not chargeable to Income-tax in the hands of a resident super senior citizen(who is at least 80 Years of age at any time during the previous year)

Limit of exemption: Rs. 5,00,000 this exemption is available for Resident Super Senior Citizen

Section 87A: Rebate to resident individual whose total income does not exceed Rs. 5,00,000

Limit of exemption: Rebate shall be limited to tax payable or Rs. 12,500, whichever is less this exemption is available to Resident Individual

Tonnage Taxation

Section 115V to 115VZC(Tonnage Taxation): Qualifying Company may opt for computation of income from business of operating qualifying ship on presumptive basis.

* A company is a Qualifying Company if:

a) It is an Indian Company;

b) The place of effective management of it is in India;

c) It owns at least one qualifying ship; and

d) The main object of it is to carry on business of operating ships.

Limit of exemption: The income from operating ships shall be computed on basis of tonnage of each qualifying ship. This exemption is available for Indian Company

Note : Public Sector Companies, Banking Companies and Insurance Companies have not been considered in the document.