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Tag: retired government employee

  • Can solely proposer get IT profit on mediclaim coverage?

    My daughter took a mediclaim coverage for me and my spouse round 14 years again, and has been repeatedly paying premium for this coverage. I’m a greater than 70 years previous and a retired authorities worker, whereas my spouse is above 65. My daughter finds it tough to pay a big sum as premium as she is now unemployed. However, I want to proceed the coverage. I want to know whether or not I will pay the premium quantity for this coverage, which covers me and my spouse and declare the earnings tax advantages obtainable beneath Section 80C?

    —Jeyaseelan Devadoss

    Medical Insurance premium might be claimed as a deduction beneath Section 80D and never 80C. The tax profit beneath Section 80D is over and above the ₹1.5 lakh deductions obtainable beneath Section 80C.

    The new tax regime is the default tax regime for FY 2023-24 onwards and deductions beneath Chapter VI A i.e. 80C, 80D, and many others. is not going to be obtainable beneath the brand new tax regime. If you go for previous tax regime then, you may declare deductions beneath Chapter VI A of the Income Tax Act. Section 80D of the Income Tax Act lays down that the deduction for medical insurance coverage premium might be claimed by a person who pays the premium for self, partner, dependent youngsters, mother and father. There isn’t any point out of proposer or coverage proprietor within the Act. It solely mentions that in the event you “pay the premium” for a coverage for self, partner, dependent youngsters, mother and father you may declare the deduction.

    The most deduction obtainable for self, partner and dependent youngsters is ₹25,000. The restrict will increase to ₹50,000 in case of senior residents. Similarly, if you’re paying medical insurance coverage premium for fogeys’ coverage, you may declare a further good thing about ₹25,000 for dad or mum’s medical insurance coverage coverage. In case mother and father are senior residents, then the restrict will increase to ₹50,000. To qualify for the deduction, the premium should be paid by way of a non-cash methodology. Further, you may as well declare a tax deduction of ₹5,000 every year on preventive healthcare for your loved ones.

    Here, you’re paying the medical insurance coverage premium for your self and partner’s coverage and you’re a senior citizen. Thus, it is possible for you to to assert the deduction of most ₹50,000 for this coverage.

    Nitesh Buddhadev is a Mumbai-based chartered accountant.

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    Updated: 13 Sep 2023, 10:35 PM IST

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  • Is a retired employee eligible for a home renovation mortgage?

    I’m a 55-year-old retired authorities employee who must renovate my house, assemble one different flooring and lease it out for an extra provide of earnings. Am I eligible for a home mortgage or should I make partial withdrawal from my provident fund (PF)?

    —Name withheld on request

    Many lenders current dwelling loans for renovation and the addition of 1 different flooring. Here are some parts that may determine the eligibility for a mortgage: The renovation plans have to be accepted by respective authorities; the additional improvement must be for residential features; and an architect’s plan and estimate from a civil contractor have to be in place.

    There are diversified mortgage selections accessible for pensionerss, offering charges of curiosity at par with another salaried borrower and extended compensation intervals, sustaining your current age in ideas.

    You should ideally check out a public sector monetary establishment for meeting your personal house mortgage requirement. They could ask in your associate/children to be co-applicants in your mortgage.

    Another situation to recollect is the utmost outgo out of your pension, allowing in your common household payments to be left unhindered. Usually, the lender moreover has a certain proportion that could be allowed out of your pension within the path of the mortgage compensation. It might be prudent to not take the proposed lease into your month-to-month mortgage compensation calculations . Once the leases are acquired, you’ll be able to start making part-payments or enhance your EMI amount, which could help in bringing the final tenure and curiosity outflow down.

    What are the tax implications for selling a property that I had inherited from my grandparent in 2022. I’m a homemaker with no completely different sources of earnings.

    —Name withheld on request

    When a property is acquired by the use of inheritance or as a gift, it is not taxable for the receiver. However, if that’s subsequently supplied, the income will doubtless be matter to capital constructive elements tax . In such a case, the categorisation of capital constructive elements (temporary time interval or future) for taxation features will depend on the size for which the property was held by your grandparent and later by you. A marginal tax charge is related on temporary time interval capital constructive elements whereas a flat tax charge of 20% is related on future capital constructive elements. The distinction between the sale worth and the related charge worth of the property could be the capital constructive elements on the sale of the property.

    • Cost of the Property: The property did not value one thing to the inheritor, nonetheless for calculation of capital obtain the related charge to the sooner proprietor is taken into consideration as the worth of acquisition. Expenses, if any incurred by the inheritor on the advance of the property will doubtless be added to the related charge.

    • For LTCG, the worth of the property will doubtless be matter to Indexation. In the case of inherited property, the 12 months of acquisition of the sooner proprietor is taken into consideration for indexation of the worth of acquisition.

    • For an Indian resident, the capital Ggins will doubtless be eligible for the basic exemption limits of earnings tax. However, no deduction beneath sections 80C to 80U is allowed on LTCG.

    Amit Bhachawat is the CFO, India Mortgage Guarantee Corporation

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