• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

T. Banusekar

MY taxable income for the financial year 2004-05 is Rs 1,05,000. I am eligible for a rebate of Rs 5,000 under Section 88. Can I claim rebate under Section 88D in respect of the balance tax payable, which amounts to Rs 5,000?

Mohan

Reply

Rebate under Section 88D would be available to the full extent of tax payable if the total income of a resident individual does not exceed Rs 1 lakh.

If it does, the rebate would be the difference between the tax on total income and that part of the total income that exceeds Rs 1 lakh. For computing rebate under Section 88D, the tax on total income would be the tax arrived at before allowing a rebate under Section 88.

In the instant case, the tax on total income, that is, the tax on Rs 1,05,000 would be Rs 10,000 (computed before rebate under Section 88). The rebate under Section 88D would be Rs 10,000 (being the tax on Rs 1,05,000) as reduced by Rs 5,000 (being the excess of total income over Rs 1 lakh).

You can, therefore, claim the rebate under Section 88D to the extent of Rs 5,000. And the rebate under Section 88, to the extent of Rs 5,000 on the balance of tax payable. You would, therefore, not be liable to pay any tax in relation to the income of the previous year 2004-05.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Nomination and transmission

Copyright © 2004, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line