How pay zero tax on Rs. 10,00,000 annual income from salary.

According the provision of Income Tax Act 1961 every assessee need to pay Income Tax on his total income earned during previous financial year( like 01/04/2019 to 31/03/2020).

Income Tax is payable on the total income at the rates of income tax prescribed. The term GTI has been defined in sub-section 45 of section 2 (Chapter II) of Income Tax Act, 1961 as under: “total income” means the total amount of income referred to in section 5, computed in the manner laid down in this act.

Total income means income from Five head

1.Income from salary

2.Income from house property

3.Income from Business & Profession

4.Income from Capital Gain

5.Income from other source

 

According to interim budget 2019 any salary person can pay zero tax on Rs 10,00,000 annual income by investing as following

1.Deduction under Section 80 ( C) Rs.1,50,000

2.National Pension Scheme Rs. 50,000

3.Housing Loan interest deduction Rs.2,00,000

4.Mediclaim for parents  Rs.50,000

5.Standard Deduction Rs. 50,000

For Example Dr. Murli is  salaried person earned Rs. 10,00,000  as annual salary. He invested as following

He paid Tuition Fee Rs.30,000 for his two children and  Rs.1,00,000 for life insurance to his family. He paid Rs. 2,00,000 as interest on house loan.

He also paid  Rs. 20,000 repayment of Housing loan during  the financial year .

He invest Rs. 50,0000  in  National Pension Scheme

He. paid  Rs,50,000 as Mediclaim for parents.

According  above mention investment   Dr. Murli taxable liability will be Zero