The following are the changes proposed in the Budget for FY 2009-10 that have an impact on Payroll:
Tax Slabs:
In Case of General Assesses:
| Income Bracket | Rate |
| 0 to Rs. 1,60,000 | 0 % |
| Rs. 1,60,001 to Rs. 3,00,000 | 10 % |
| Rs. 3,00,001 to Rs. 5,00,000 | 20 % |
| Above Rs. 5,00,000 | 30 % |
In Case of Women Assesses:
| Income Bracket | Rate |
| 0 to Rs. 1,90,000 | 0 % |
| Rs. 1,90,001 to Rs. 3,00,000 | 10 % |
| Rs. 3,00,001 to Rs. 5,00,000 | 20 % |
| Above Rs. 5,00,000 | 30 % |
In Case of Senior Citizens:
| Income Bracket | Rate |
| 0 to Rs. 2,40,000 | 0 % |
| Rs. 2,40,001 to Rs. 3,00,000 | 10 % |
| Rs. 3,00,001 to Rs. 5,00,000 | 20 % |
| Above Rs. 5,00,000 | 30 % |
* On final tax amount, a surcharge of 3 %
**No surcharge above 10 lacs.
Exemptions:
1) 80 C Limit Unchanged
2) 80 D
| Mediclaim Premium on the Health of | Investment limit |
| a) Self Spouse and Children | Rs. 15,000 |
| b) Parent/Parents | Rs. 15,000 |
| c) If Parent/ Parents Senior citizen | Rs. 20,000 |
3) Section 80DD
- Exemption was given for Expenditure made for a disabled dependant towards Medical Treatment/Training/Rehabilitation. It also includes the LIC/insurance paid towards maintenance of such dependant.
- Such exemption was up to 50,000 in case of normal disability and 75,000, in case of severe disability.
- This limit has been kept the same 50,000 in case of normal disability, but increased to Rs. 1 Lakh in case of severe disability.
- Applicable for AY 2010-11 (FY 2009-10)
4) Section 24(1)(vi)
Housing loan interest.
Maximum Investment Limit 1,50,000 (for loans taken after 1 April 1999, for loans before that Maximum Investment Limit 30,000).
5) 80DDB
Expenditure incurred on specified disease or ailments such as cancer/aids
Maximum Investment Limit – 40,000
In case of senior citizen; Maximum Investment Limit – 60,000
6) 80U
Permanent disability benefit (Self) – adhoc amount
Maximum Investment Limit – 50,000
In case of disability exceeding 80%, Maximum Investment Limit – 75,000
7) Section 80E
- Earlier it was applicable only for Graduate / Post-Graduate, Fulltime studies
- Now all studies after Class 12 is allowed, either vocational or Fulltime. But should be from a school/institute/university recognized by the government.
- Applicable for AY 2010-11 (FY 2009-10).
8 ) 80CCD:
Contribution to NPS and returns on NPS tax free, but withdrawal still taxable
9) 100% exemption on donation to political parties
10) Fringe Benefit Tax
- FBT was introduced in 2005.
- FBT is now completely withdrawn.
- Consequently, the fringe benefits will be taxed as perquisites in the hands of the employees.
- Superannuation – Any contribution made by a company to superannuation fund above Rs. 1,00,000 taxable in the hands of the employee
- Applicable for AY 2010-11 (FY 2009-10).
