Not many people are aware of this deduction is respect of rent paid :
Section 80GG Deduction-Get Tax Benefit on rent paid if not getting HRA !!!
All salaried are very much familiar with HRA and how to get the benefit of the rent they pay. However, what about those who not get HRA in their salary or for self employed? Will they still get rent benefit? The answer to both the questions is Section 80GG of Income Tax.
So as I said above this section only applies to those who have not availed HRA in their salary or not claiming the deduction on their rent in any of the other sections of income tax. Below are a few conditions to avail the deduction under this section.
This section is only applicable to Individual or HUF.
Tax Payer may be either salaried or a self-employed. However, must not be getting HRA.
Tax Payer himself or spouse/Minor Child/HUF of which he is a member should not own any accommodation at a place where he is doing a job or business.
If Tax Payer owns house at a place other than the place noted above, then the concession in respect of self occupied property is not claimed by him [Under Section 23 (2) (a) or 23 (4) (a)].
Tax Payer has to file a declaration in Form No.10BA regarding the expenditure incurred by him towards the payment of rent.
How much amount of deduction one can avail under Sec. 80GG?
If the above five conditions are satisfied, the amount deductible under Section 80GG is LEAST OF THE FOLLOWING.
Rs.5, 000 per month;
25% of total income of taxpayer for the year; or
Rent Paid less 10% of total income (Rent Paid-10% of Total Income).
What is total income for the purpose of Sec. 80GG?
We can calculate it as below.
Total Income=Gross Total Income-LTCG-STCG-Income referred under the Sec.115A-Amount deductible under Sec.80C to 80U (except Section 80GG)
Let us try with one example-
Mr. X’s total income (calculated as per above formula) is Rs.4, 00,000. He pays an annual rent of Rs.1, 50,000. Then least of the below will be applicable for deduction under Sec. 80GG.
Rs.60, 000 per year.
Rent Paid-10% of Total Income=Rs. 1,50,000-Rs.40,000=Rs.1,10,000.
25% of Total Income i.e Rs.1, 00,000.
So least of the above will be Rs.60, 000, which one can claim under Section 80GG for that particular FY.
The cool thing about math is watching how seemingly impossible combinations seem to walk out perfectly in the end. By doing certain operations, you can turn wildly complex equations into simple, step-by-step solutions.
Using the Vertical and Crosswise Pattern, we can easily multiply large two-digit numbers like the one pictured below.
Instead of doing the standing method of multiplication, we are going to separate and conquer.
12 x 34
First, we multiply vertically up the right side. 2 x 4 = 8. So, 8 will be the last digit in our answer.
Next, we cross-multiply. 3 x 2 = 6 and 4 x 1 = 4. Now add 6 + 4 to get 10. Carry over the 1 like you normally would, and you are left with 0, which will go in front of the 8 we already have.
So, as of now you should have 08 in you answer line.
Lastly, we vertically multiply up the left side. 3 x 1 = 3 and add the carried 1. Place that in the front of our answer line and we get 408.
All you need to do is add the digits of the number you are multiplying by 11 and place that in the middle of the original number. If the sum of the digits is 10 or larger, simply carry it over. Better to see it than me write it.
See how easy that was? Basically, if you know how to add, you know how to multiple by 11.
Now, let’s look at another example.
11 x 11
Just separate the number being multiplied by 11 (in this case, also 11) so that there’s room for your number in-between. Now, just add the two digits in that number together (1 + 1 = 2) and throw the sum in that space you left open. That gives you 121.
58 x 11
Just add 5 + 8, which gives you 13. The slide it in-between the 5 and 8 and you get 5138. But, that’s not right, since you need to carry that one over. Go ahead and carry it over and you’ll end up with 638.
Needless to say, I feel like a complete badass now that I know this.