Rebate u/s 80G limited to 50% of donation

S C  Vasudeva

I am a senior citizen of 68 years. In the financial year 2015-16, I would get a total income of Rs 5,70,000 from my pension only.I will donate Rs 1,00,000 to a registered charitable medical relief society. How much income-tax I have to pay for the year 2015-16.  Please narrate by an example. — Ajit Singh Kaler

The deduction admissible under Section 80G of the Act is limited to 50% of the amount paid as donation subject, however, to the fact that in case the amount of donation exceeds 10% of the total income, such deduction shall be admissible in respect of 10% of the total income.  Accordingly, the computation of tax in your case would be as under:-

Total income Rs 5,70,000

10% thereof Rs 57,000

Less admissible deduction Rs 28,500

Taxable income Rs 5,41,500

Tax payable on above Rs 28,300

Education cess of 3% Rs 849

Total tax Rs 29,149

We are operating a joint demat account with a broker for trading shares. The first name is of my wife, second of my son and third mine. We are also operating a joint bank account for making payments to purchase shares and depositing the sale cheques in the above account. At the end of the financial year, we divide the profit or loss of transactions equally among us and show it in income tax returns. Kindly clarify whether the procedure is correct or not.  If not, then please let us know the correct procedure. — R K Julka

The procedure adopted by you is not correct. In accordance with the provisions of the Income-tax Act, 1961 (The Act), the share trading business carried on by three of you will be treated as an Association of Persons. An Association of Persons means, an association in which two or more persons join with a common purpose or common action, and the object of such association is to produce income, profits or gains. It may be added that such an Association of Persons is taxable at the maximum marginal rate on the total income of such an association, in case the shares of each of the members are indeterminate or unknown.

I am employed as a medical officer in Himachal Pradesh Goverment. A TDS of Rs 15,000 was deducted by DDO from my salary of March, 2012 (paid in April, 2012). The TDS was not credited in my 26-AS form. My details are as under:

Total tax liability Rs 3,44,023

TDS by DDO from salary Rs 3,57,370

26-AS form Rs 3,42,370

On August 18, 2014, I received an intimation u/s 143(1) of the I-T Act to deposit Rs 1,653. I deposited the same by a challan in State Bank of India for the fear of penalty by the I-T Department. By depositing the abovesaid amount, I paid a total tax of Rs 3,59,023. I have requested many a times in writing to DDO for the refund of Rs 15,000 but to no avail. Please advise how I can get refund of Rs 15,000. — Dr.  Surinder Singh

It seems form 16A issued by your department in respect of your salary income would have reflected such salary for the months March 2011 to February 2012 so as to conform to the tax deduction system prevailing in the government offices. It is a possibility that salary for the month of March 2012 has been included in the certificate for the next year. You would, therefore, automatically get the credit for the tax deducted at source in respect of salary for the month of March 2012. Please look into your certificate or confirm with DDO that the procedure which I have mentioned above is being followed.  The credit for tax deducted at source in respect of salary for the month of March 2012 must have been given in the certificate for the next year. The question of refund of Rs 15,000 would not arise in case my presumption is correct.