EXEMPTIONS/DEDUCTIONS EXTENDED
- 100% Tax holiday for 5 assessment years shall be provided to any hospital which is constructed and starts functioning on or after 1st April 2008 and before 31st March 2013 anywhere in India, other than excluded areas (big cities/towns specified in explanation) if prescribed conditions are satisfied.
- The following investments have been included under Section 80C:
- Five year time deposit in account under Post Office Time Deposit Rules, 1981; and
- Deposit in an account under the Senior Citizens Savings Scheme Rules, 2004.
- If the assessee withdraws the amount from such accounts before the expiry of a period of 5 years from the date of its deposit, the principal amount and the interest thereon so withdrawn shall be deemed to be income of the assessee of the previous year in which the amount is withdrawn.
- Additional Deduction of Rs.15,000/- (Senior Citizen – Rs.20,000/-) on health insurance premium paid for parents under Section 80D will be provided.
- Definition of “charitable purpose” u/s Section 2(15) amended so as to provide that advancement of any other object of general public utility shall not be treated as charitable purpose for claiming exemption u/s 10(23C) or section 11.
- The benefit of Section 35D relating to amortization of preliminary expenses extended to Service Sector and trading sector also.
- Any income derived from saplings or seedlings grown in a nursery shall be exempt from tax as agricultural income.
- From AY 2008-09, any amount paid to a company to be used by it for scientific research is deductible at 125% under section 35 if prescribed conditions are fulfilled.
- Section 40 A(3) is amended so that the splitting of payment in a single day is not permitted and hence any cash payment to a single person in a day exceeds Rs. 20,000 then it is liable for dis allowance subject to Rule 6DD.
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