How will Budget 2011 affect you ?

POSTED BY manish ON March 2, 2011 COMMENTS (76)

How much will you benefit with this budget ? There are some direct and indirect effects on a common man due to this budget which we will look in this article point by point . There has been not a major changes on exemption limits, but there are some changes which aim to simplify the whole process of Income tax.

Budget 2011 India changes

Tax Exemption limit raised

Earlier the limit of exemption was Rs 1,60,000. It has been raised from 1,60,000 to 1,80,000 . Which means roughly Rs 2,000 saving for individuals. For women, the exemption limit is at the same 1,90,000 .

Senior citizen definition and limits

Senior citizen definition is changed. Now any one above age 60 yrs will considered as senior citizen, earlier this was 65 yrs . This is a good move as more and more people will be able to enjoy the benefits of senior citizens. The exemption limit for senior citizens was also raised to 2,50,000 from previous limit of 2,40,000 .

No Tax Return filing if income less than Rs 5 lac

This has been the best point of this budget , from years small tax payers who were having smaller salaries had to go with the cumbersome process of filing tax returns , But from now on tax payers having income of less than Rs 5,00,000 will not have to file their tax returns, if their TDS is cut by their employer.

But incase one has additional income from other sources like dividends, capital gains , interest from Bank deposits or Income from House and Property etc , in that case they will have to file the tax returns or they will have to notify their employer in advance about these additional source of income so that the employer can take these points in consideration and deduct the extra TDS. In this case employees form 16 will be treated as their tax returns. This change can be a bit of blow for tax return filing service providers, a big relief for small tax payers who are purely salaried.

“CBDT will be issuing a notification, which clarifies about the  ‘classes of persons’ exempted from the requirement of furnishing income tax returns. This will be implemented for the year 2011-2012 and will come into effect from June 1, 2011” – said Sudhir Chandra , CBDT chairman .

New category called “Very senior citizen”

There is a new category of senior citizen called “very senior citizen” in this budget. Any one above 80 yrs of age will be under this category and they will not be taxed up to the income Rs 5,00,000 . While this looks a nice addition, the benefits of this move should be very limited, as I wonder how many 80 yrs old will have their personal income more than 5 lacs in our country. But it’s would be a good strategy to gift a big lump sum to very senior citizen and let it be invested on his name and generate income for him.

Infrastructure bonds extended by one more year

We saw the introduction of Infrastructure Bonds last year which can save you additional Rs 20,000 exemption other than sec 80C. In this budget , the this benefit is extended by one more year . Which means that in 2011 – 2012 also you can invest in Infrastructure bonds and save some tax.

Insurance policies other than Term Insurance to get expensive

In this budget, our financial minister has warned all the insurance companies to have a deeper focus on pure risk cover. Service tax net has been widened to insurance policies which have “investment” component, which means ULIP’s , Endowments plans , money back plans and even return of premium term insurance plans will have a higher service tax on the premiums. Earlier there was 1% service tax on the premiums, but now it has been raised to 1.5% . Which means that incase your premium is Rs 50,000 in ULIP , you were paying service tax of Rs 500 earliar, but now it would be Rs 750 , which will be adjusted from the premium itself . So that gives another reason to opt for term insurance now ! .

Medical , Air-travel and hotels becomes Expensive

Healthcare , Air-travel and expensive hotels is set to become more expensive due to some changes in this budget. The changes are

  1. Health check-ups done by hospitals with more than 25 beds or those with air conditioning will now be in the service tax net .
  2. There will be service tax of 5.15% on  hotels where the tariff is more than R1,000 a day or they are air-conditioned restaurant that has a licence to serve liquor.
  3. The service tax on economy class airfare has been increased by R50 to R150 on domestic sectors and by R250 to R750 for international travel.

So you will have to add some more thousands to your bill incase you were planning to go on vacation with your family and it required air travel + hotel stay !

Day to-day basic items to get costlier

There is excise duty of 1% levied on 130 items which includes day-to-day items like tea, coffee, sauces, ketchup, mobile phones , soups and all kinds of food mixes, ready-to-eat packaged foods . This would mean a bit of cost increased on them .

DTC coming in 2012

Financial minister has once again confirmed in his speech that DTC will be implemented from year 2012 . As per this article DTC would affect the NRI definition and it would negatively impact them.

Employer contribution towards NPS goes out of sec 80C

If your employer was contributing towards NPS , his contribution was eligible under 80C , but with this budget while it will still get tax deductions , it would come out of 80C , which means that some space will be left under 80C for people whose employer was contributing in NPS . The person can now invest more in sec 80C because of this .

Tax Slabs India 2011

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76 replies on this article “How will Budget 2011 affect you ?”

  1. anand singh says:

    whether govt. contribution in NPS for its employee in 2011-12, will be outside 80C or not. pl tell.

    1. that should be outside 80C

  2. Rajesh says:

    Dear Manish,
    Is this rule of Examption of tax below 1.8 Lac is effective for this financil year 2011-12 ?

  3. srinvsamurthy says:

    sorry. i forgot to gve details of exemptions…. LIC prm 35000, med ins prm.8670//
    rental rec chgs,17500/= i.e, total around.rs59000/- pl let me know in detail thank you sir

  4. srinvsamurthy says:

    Sir, I am aged 69 yrs, pensioner,hving income by pension rs.1,80,000 and rental inome of rs.65000 PA, and int on Dep rs,75000 totally rs.3,20,000. shall iahve to Py IT and submit retn for Mar,2012.? Pl guide me.

    Thanks

    1. Srinivasy

      Your income is above the limit , but if you invest in few tax saving instruments your taxable income will be below limit and you might not have to pay tax, but even then the return filing has to be done

      Manish

  5. Ashok says:

    Manish,

    I am looking for requirements for NRI in the new DTC.
    To claim NRI status earlier one had to stay OUTSIDE india more than 183 days. Does it remain the same?

    Thanks

    Ashok

    1. Let first DTC come into effect . we cant be sure that its coming 100% . What if there is again a delay ?

  6. Raja sekhar says:

    May i know about this 10-10-d ? is there any change in this ?

    1. Nothing is changed in 10 10 d for this current year

      1. Raja sekhar says:

        Hi Manish
        can you please see this link and let me know is there any change in the cash back policy(life insurance) for the next financial year
        https://taxguru.in/income-tax/direct-tax-code-may-bring-ulip-life-insurance-plan-under-tax-net.html

        1. Raja

          After DTC comes in year 2012 , Tax rules will change , only those policies which have premium less than 5% of SA will be eligible for tax deductions at the time of contribution and also at maturity , right now its 20% .

          So right now if some one pays 25k premium for SA 1 lac , he will not get tax benefit not his matutiry amount will be tax free as his premium is more than 20% of SA , thats current law .

          One DTC comes, it will change to 5% .

          I hope you are clear now ?

          Manish

          1. Raja sekhar says:

            Thanks Manish so for the next financial year 2011 -2012 ,there is change in tax policy. If i take the policy now is my maturity amount and cash back every 5 years will not be taxable right(i got that 20% below).
            Sorry for the first time i am understanding these things so taking some time to ink in.

            1. Raja sekhar says:

              Now i mean in financial year 2010-2011

            2. Raja

              DTC will be applicabel from 2012-2013 only , We have one more year to go . After 2012 , new rules will apply , Having premium below 5% is best option . DTC will take new shape again as we have one more year to go .

              Manish

            3. Raja sekhar says:

              Thanks Maneesh, I really appreciate your help.
              This is the best place to understand budget in simple words to the extent we needed,thanks again…

            4. Raja

              Great 🙂 . Keep reading 🙂

              manish

  7. Raja sekhar says:

    Hi
    I am looking to take a cash back policy. One of my friend told that in the latest budget the amount i received (for every 5 years) is taxable. is that true?
    I read that there is change of tax from 1 to 1.5% for initial premium. but is there any changes of tax on the amount i am going to receive . is it taxable or not?

    1. Raja Sekhar

      Its not taxable as per current law .

      Manish

  8. Anand says:

    Hi Manish, Can you tell us in detail about DTC provisions. It would help in financial planning starting this year. there r several diff. versions in the net. pls publish a reliable one.

    thanks
    Anand

    1. CA RAJIV SAXENA says:

      hi Anand, almost each and every provision of income tax laws has been changed in DTC, which will be applicable from f.yr. 2012-13.
      Are you salaried person, businessman, professional, etc. please specify?
      Anand has asked this question to manish, but liberty from manish, i am answering to anand. hope manish dont mind.

      1. Rajiv

        You are a great help ! , Please answer questions whereever you feel . For readers Manish is the person who will for sure Look at the comments ,so they write my name 🙂

        Manish

  9. Srikanth Achanta says:

    you didnt cover Home loans in this post, HL less than 15 lacs have a 1% discount from now. Is it for existing loans or just for new loans??

    1. CA RAJIV SAXENA says:

      interest subvention (discount) of 1% is no doubt is boost for housing dreams of middle class. but it comes with a conditon that the cost of house should not exceed 25 lac rupees. this provision will be applicable for the new loans only. so this year also you can expect home loan interest of 8.5% or near thereto for small borroweres.

  10. S S says:

    No tax return filling for below 5 lacs indivuduals is a good move. However budget 2011 on the whole is a lacklusture performance. if you ask me it was done without any clear mandate in mind.

    1. SS

      Hmm .. you can say that there was no mandate , you have not looked at the overall budget . We have just mentioned about personal finance related changes in this article

      Manish

      1. S S says:

        Well.. there’s nothing innovative in rest of the budget either, leave alone the personal finance.

  11. Amit says:

    Manish,

    I put the same wine in new bottle. I am keen to invest around 2 lakh in FD for 10 years. Currently Canara bank is giving 10.5 % rate of interest for senior citizens.

    Point 1. – I want to make sure i get this high rate of interst at the same time NO TDS is deducted.

    Point 2. – I should be one of the joint account holder. I am 35 years old and have taxable income.

    Now with the New as per the new tax law. My father would be considered as senior citizen. He is getting a pension of 2.55 lakh per year.

    My Doubt is
    Can my dad submit 15H Form?
    Should he first invest 1 lakh in 80 C,so that his taxable income reduces to 1.55 lakhs and there by he will not have to pay any tax?
    How should i prove the bank that my dad will be investing 1 lakh in 80C?

    Please let me know what would be the best solution?

    1. CA RAJIV SAXENA says:

      DEAR AMIT, IF YOUR FATHER IS A SENIOR CITIZEN THEN HIS INCOME IS EXEMPT UPTO 2,40,000 FOR F.YR. 2010-2011 AND 2,50.000 FOR F.YR. 2011-2012.
      IF HE HAS INVESTED RS. ONE LAKH UNDER SEC. 80C, THEN HIS INCOME IS EXEMPT UPTO 3,40,000 OR 3,50,000 FOR RESPECTIVE YEARS.
      A SENIOR CITIZEN CAN SUBMIT FORM 15H IF THE TAX LIABILITY ON TAXABLE INCOME INCLUDING INCOME FOR WHICH 15H IS BEING SUBMITTED IS NIL. ASSUMING YOU HAVE GIVEN FIGURES OF PENSION OF RS. 2,55,000 AND FDR INTEREST FOR NEXT YEARS I.E. F.YR. STARTING FROM 1/4/2011.
      HIS INCOME WILL BE COMPUTED AS FOLLOWS (ASSUMING HE WILL BE 60 YEARS OR ABOVE NEXT YEAR)
      PENSION INCOME 2,55,000
      FDR INTEREST 20,000
      SAVING BANK INTT 2,500 (ASSUMED)
      ————–
      TOTAL 2,75,500
      EXEMPT INCOME 2,50,000
      ————
      TAXABLE 25,500
      IN ORDER TO BE ELIGIBLE TO SUBMIT FORM 15H , HE SHOULD INVEST ATLEAST 25,500 UNDER SEC 80C. ONLY THEN HIS TAX LIABILITY WILL BE NIL NEXT YEAR,
      HOPE YOUR QUERY IS SOLVED

      1. Amit says:

        Rajiv sir…..

        Wonderful……………………… Crystal clear…. Thank lot.

  12. CA RAJIV SAXENA says:

    WOMEN SHOULD NOT LOOSE HEART, THINKING THAT THEIR EXEMPTION LIMIT HAS NOT BEEN INCREASED. FM HAS DONE THIS THING KEEPING IN MIND THE PROVISIONS OF DTC. IN DTC, EXEMPTION LIMIT WILL BE SAME BOTH FOR MEN AND WOMEN.
    BUT CONSIDERING THE NUMBER OF WOMEN IN PARLIAMENT, FM WILL BE UNDER LOT OF PRESSURE TO PROVIDE EXTRA EXEMPTION LIMIT TO WOMEN. AND THEY DESERVE IT. THEY WORK MORE THAN MEN, BOTH AT HOME AND OFFICE. CHEERS!

  13. CA RAJIV SAXENA says:

    GOVT. IS SOMETIMES VERY HARSH. TAX SHOULD BE ON PERKS AND LUXURY ITEMS, I MEAN THOSE THINGS WHICH GIVE US ENJOYMENT. BUT SERVICE TAX ON MEDICAL SERVICES IS LIKE TAX ON DISEASES. IT SEEMS THAT GOVT IS SAYING “YOU CATCH A DISEASE, WE WILL TAX YOU. FINANCE MINISTER SHOULD ABOLISH IT.
    EVEN SCOPE OF SERVICE TAX ON LEGAL SERVICES HAS BEEN ENLARGED. JUSRICE HAS BECOME EXPESIVE NOW. THIS GOVT HAS NO SOCIAL RESPONIBILITY.

  14. CA RAJIV SAXENA says:

    BUT IN THIS BUDGET , ONE THING FOR SURE HAS BEEN IGNORED. WHICH IS PRACTICE OF BLACK MONEY. FM HAS TALKED A LOT ABOUT MONEY. BUT THERE IS NO CLEAR INTENT OF GOVT. ON CURBING BLACK MONEY OR BRING BLACK MONEY FROM ABROAD TO INDIA. SOME INCOME TAX PROVISONS HAVE BEEN CHANGED, BUT THESE PROVISIONS WILL HELP HASAN ALI KIND OF PEOPLE ONLY. I AM A CHARTERED ACCOUNTANT IN PRACTICE AND I BELIEVE THAT NO INDIAN GOVT WILL DO ANYTHING TO BRING BLACK MONEY BACK TO INDIA. CHOR CHOR MOSARE BHAI.

  15. CA RAJIV SAXENA says:

    AS FAR AS EFFECT ON DTC ON LIFE INSURANCE IS CONCERNED, I THINK, THE PROVISION OF MINIMUM SUM ASSURED SHOULD BE 20 TIMES OF ANNUAL PREMIUM, HAS BEEN MADE KEEPING IN VIEW THE LONG TERM BENEFIT OF PEOPLE. SO FAR COMPANIES WERE SELLING INSURANCE PRODUCTS JUST LIKE SAVING ITEMS. PEOPLE WERE BUYING THEM THINKING THEM AS TAX SAVING INSTRUMENTS AND NOT INSURANCE INSTRUMENTS. GOVT. WANTS INSURANCE PRODUCTS SHOULD REMAIN JUST INSURANCE PRODUCTS. ONLY THOSE CAN UNDERSTAND THE TRUE BENEFIT OF INSURANCE WHO HAVE LOST THEIR DEAR ONES AND GOT DEATH CLAIMS.LIFE INSURANCE CAN NOT BRING BACK ONE WHO HAS DIED. BUT IT CAN CERTAINLY KEEP THE LIVES OF FAMILY ON TRACK.
    TERM INSURANCE IS BEST INSURANCE. EVEN MANY HIGHLY EDUCATED PESONS CONSIDER IT AS USELESS, BECOSE THERE IS NO MATURITY BENEFIT. BUT I TELL THEM THAT NO BODY IS BORN WITH A GUARANTEE CARD FROM GOD SAYING THAT “YOU WILLNEVER DIE”. PREMIUM FOR TERM INSURANCE WILL BE COVERED BOTH UNDER DTC AND CURRENT INCOME TAX ACT.

    1. Rajiv

      Thanks for your four comments on this article ,It really adds value ! . Keep sharing your knowledge !

      manish

  16. CA RAJIV SAXENA says:

    DEAR ALL,

    BUDGET IS A BALANCING ACT. JUST LIKE A BALANCE SHEET, BOTH SIDES OF BUDGET (REVENUE AND EXPENDITURE ) SHOULD TALLY. FINANCE MINISTER HAS THIS BUDGET IS A NETURAL ONE I.E. NO EXTRA REVENUE WILL ACCRUE TO GOVT. AS FAR AS SERVICE TAX ON MEDICAL SERVICES IS CONCERNED, THIS PROVISION WILL NOT BE THERE WHEN BUDGET IS PASSED. BECOSE MILLIONS OF PEOPLE ARE AFFECTED. AN EMOTIONAL APPEAL HAS BEEN MADE TO FM. UNLIKE PREVIOUS FM MR. CHIDEMREM, MR. PRANAV MUKHERJEE IS LISTENS TO OTHERS.

    1. Rajiv

      thanks for your point 🙂 . You gave a new perspective 🙂 , Balancing act !

      Manish

  17. Atul says:

    Hi Manish,

    Not a great budget.

    Service tax on Insurance premium. Does that mean I continue to pay same premium for endowment plan and Service tax adjusted within OR additional Service tax?

    Health care cost is going to increase which is not good for common man.

    Cheers

    Atul

    1. Atul

      You will not have to pay the additional premium , but it will go from the insurer pocket and eventually will be adjusted from your wealth only , so less IRR for you , but it would be small number 🙂

      Manish

  18. Krishna says:

    Manish,

    I have a query on IT return.On IT return need not be filed for the person under 5 lakh annual income is the 5 lakh total annual income or the taxable income?.

    Krishna

    1. Krishna

      It has to be taxable income i suppose . But not sure !

      Manish

    2. vedanth says:

      You are mistaken. The limit of Rs 5 laksh is the taxable income and not total income in an year. moreoever, all persons whose income exceeds the prescribed exemption ,is to submit the IT return invariably

  19. Smart Singh says:

    Short and crisp summary Manish. Such a relief to see this article after all the media hoopla. Can’t believe all newspapers dedicated 20 pages to this budget. To me, it was almost a non-event. The only good thing was there were no populist proposals and hence the excitement in the markets.
    Similary, I’m sure that next year’s budget would make media wet their pants in excitement. While DTC’s first draft was quite a regime shift, it has already lost a lot of steam since its first draft.

    1. Smart Singh

      Yea .. not major things for a common man in a way , but still something to look at . Next year when DTC comes it would mean 1 month of no-vacation in Media , the news overload about DTC will be more bigger than DTC itself !

      Manish

  20. Krish says:

    This budget neither revised to include/delete tax saving instruments under 80C, 80CCC etc., nor upper/lower limits. Looks to me that FM would continue to focus on levying additional tax for private players promotional products which attracts tax savings such as ULIPs and High value Home Loans. The additional service tax on ULIP in the current budget is one such sample. It may not be the great news for middle & higher income families.

    ULIPs are pushed by private players these days that EEE would continue for the old policies even after DTC comes on board. Clarity needs to emerge on this issue. If true, ULIPs would be agreesively pushed this year (1 month) and next year like never before. Else it would be end of ULIPs after DTC. Undoubtedly the private insurance business is at stake. Certainly not a good news for its employees.

    1. Krish

      Not a lot of changes in 80C as it would eventually go away soon and replaced with DTC

      Manish

  21. Archana says:

    Hi Manish,

    As for me this budget has had a soft landing…..as usually things like price increase, adding /substracting of certain benefits do happen. And hence most of your investment calculations help us taking into consideration the inflation.

    My parents are happy of getting away from filing tax returns…but also upset as they made it 60 years…..(which is prayers come true for my father who cribbed about reaching 65 just to take tax benefit…and will turn 65 in few months 🙂

    Medical,air-travel impact me a lot as both sides my parents are not getting younger & neither me….with another 20 years more to work….
    Sincere Thanks to you and your forum which has given me great perspectives and atleast secure some areas of financial security for my family with my limited resources…….. Regards Archana

    1. Archana

      Thanks 😉 . Keep reading !

      Manish

  22. Amit says:

    I was waiting for your compilation….. Everything like quick referal hand book.

    My dad is benefited by reducing the age to 60. He gets pension of around 22k permonth. Can he submit 15G or 15 H form to banks so that they dont deduct TDS now?

    I thought senior citizen can submit 15H form only if his sal is less than taxable limit

    1. Amit

      Yes , 15H can be submitted by senior citizens .

      Manish

  23. gopal says:

    Hello Manish,

    Just got this info from a program on CNBC Awaaz yesterday. Life insurance industry is still awaiting for the clarification on revised charges of ULIP. It’s clear about endowment plan charges – increased in service tax from 1% to 1.5%. But in case of ULIP, at first instance, it seems the finance minister has levied service tax + cess on all charges including premium allocation charges, policy admin charges & other admin charges. Previously, it was only on mortality charges and FMC. This will further decrease the overall IRR of ULIP in long term.

    But as stated, it will take some days to get more clarification on charges of ULIP.

    1. Gopal

      Thanks for the update , I am not sure what it will be 🙂 . please update once its there

      Manish

  24. Gaurav says:

    Dear Manish,

    As a new investor, i was putting on hold all my investment plan hoping for major changes introduced in DTC. Now with its postponement, what strategy should i take for investment this year. i cannot make a longterm decision as DTC is going to completely change the different instruments.

    Kindly suggest!

    1. Gaurav

      What is your long term decision ? give more inputs , keep it brief and limited .

      manish

  25. Rakesh says:

    Manish,

    Very well compiled.
    I think it was an average budget. I am more concerned with the health-care services and day to day basic items getting costlier.

    Rakesh

    1. Rakesh

      yes , thats the concern , are you not happy for the return filing thing ? I hope you are not eligible for that

      Manish

  26. Roopesh Majeti says:

    Hi Manish,

    How about the MF which was covered under 80c earlier. Do they still hold under the current year as well. I remember last year, there was a news saying that the ULIP and other MF investments will be moved out of 80c saving bucket.

    1. Roopesh

      ELSS are still under 80C and there is one more year to go . It will not be there once DTC comes after 1 yr .

      Manish

      1. Sahil Bhatia says:

        Hi Manish,

        A very nice and informative article indeed.
        Thanks for the info.

        Just pondering about your comment though :-
        “ELSS are still under 80C and there is one more year to go . It will not be there once DTC comes after 1 yr .

        Can you please share some more light on this ?
        Do you mean to say that Equty Linked Saving Schemes like ELSS Mutual Funds are going to taxable after 2012 ? (My apologies in advance as I do not have much info on his topic).

        Thanks
        Sahil Bhatia (v-2sahb)

        1. Sahil

          Right now when you invest in ELSS the amount you invest in under sec 80C and is exempted from tax, just like Insurnace or PPF . But from 2012 onwards when DTC is applicable there is no tax exemption on the investment done for ELSS , so which means that then there will be nothing like ELSS atleast..

          Manish

  27. Neelesh says:

    How will NPS be treated under this budget?

    1. Neelesh

      If your employer was contributing towards NPS , his contribution was eligible under 80C , but with this budget while it will still get tax deductions , it would come out of 80C , which means that some space will be left under 80C for people whose employer was contributing in NPS . The person can now invest more in sec 80C because of this .

      This is added back in the article .

      Manish

      1. Neelesh says:

        Thanks Manish

        Again I want to ask a question regarding NPS that BEFORE THIS BUDGET If I was contributing some “X” amount to NPS and my employer was also contributing the same “X” amount.Then was “2X” (i.e. “X+X”) amount part of the mine 1 lakh limit? OR it was just mine “X” under 1 lakh limit and the employer can utilize its part to reduce his tax liability.(I admit I am a bit confused here).

        But after the budget only his contribution will come out of the 1 lakh slab and mine will remain in 1 lakh limit?Is this so?

        If that is the case will it be treated as perquisite (I have read some discussion over here https://blog.investraction.com/2011/02/nps-gets-tax-saving-fillip-in.html

        Thanks
        Neelesh

        1. Neelesh

          Yes , that 2X was under 80C , seems like you didnt knew it and made more investments under 80C , Now onwards only your part will come under 80C .

          Regarding perquisites , its for the employer benefit , you dont have to worry on that

          Manish

          1. Neelesh says:

            Thanks Manish

      2. Amit says:

        “Employer contribution towards NPS goes out of sec 80C”

        Where it is given in the Budget??????…I haven’t found anywhere in the speech.
        At present Employer contribution is counted in “Salary” and also it is coming under 80C…however after the introduction of DTC in April 2012 Employers contribution( upto max 10% of Basic+DA) will be deducted from gross salary( means it will not be counted in salary as it is being done now)…however I am not sure whether it will be counted in savings under 80C or not(max 1 lakh)

        1. Manish Chauhan says:

          Amit see : https://www.business-standard.com/india/news/set-to-become-more-attractive/426979/

          After DTC comes , 80C will anyways not exist . I would say chill for now , there will be more clarity sooner

          Manish

  28. Anup Thakare says:

    Hi Manish,

    Thanks Manish! As always this article was also informative and easy to understand. There is one more provision in this budget which affects common man. That is 1% subsidy on homeloans below 15 lacs. I was hoping to have information about this. How is this done? How can we claim benefit of this?

    Anup

    1. Anup

      Thats subsidity given for affordable housing, eventually it will help buyers in low cost segment , but i am not clear on how the benefit will be exactly passed on to end buyer .

      manish

      1. Sud says:

        Manish,
        How can it help buyers in low cost segments? House prices are already so high in major cities. It would only help those who have black money to buy 40L worth house at 20L on paper, pay 6L, and take loan of 14L and get interest subsidy for so called “low cost housing”. Absurd, isnt it? 🙁

        1. Sud

          yes it is, forget about this part actually , as its a very small update and wont effect a lot to existing investors much

          Manish

  29. Tarun says:

    Hi,
    There are not much for salaried class like us. I was expecting some revisions in the medical exemption, conveyance allowance exemption, house loan exemption if not in the tax slabs.
    Service tax on medical services is also something i am not happy about. Medical Treatment is already so expensive. :(:(

    Tarun

    1. Tarun

      Yes, but there is some good things anyways .. The whole design is to move towards DTC from next year , so no major changes have been done !

      manish

      1. Sud says:

        I was also looking forward to increased medical exemption with the treatment cost rising this budget! But they have not increased the limit, which is really foolish! What were FM thinking?

        1. Sud

          You mean you were expecting that 15k limit to be increased ?

          Manish

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