The Hindu Business Line : No deductions for divorcee

The sum that is deducted and paid from out of your salary can only be treated as an application of income and cannot be said to be diverted by overriding title for you to claim that the same is not taxable.

I am paying Rs 7,500 per month as EMI on an educational loan taken by me.

The repayment tenure is five years. I understand that for the financial year 2006-07 the claim for deduction is restricted to a maximum of Rs 40,000 in respect of interest on the loan taken and further that the principal does not qualify for deduction. Can you guide me on how the deduction is allowable for the financial year 2007-08? — Ranjeet Kumar

The deduction under Section 80E is available in respect of the interest on loan taken from a financial institution or approved charitable institution for pursuing higher education either of the individual or his relative.

The term relative for this purpose will mean the spouse and children of such individual and higher education will mean full time studies for any graduate or post graduate course in engineering, medicine, management or for post graduate courses in applied sciences or pure sciences including mathematics and statistics.

The deduction under this Section will be available for a period of eight assessment years beginning from the year in which the interest on the loan is paid.

Subject to your satisfying these conditions the deduction can be claimed by you. For the financial year 2006-07 (assessment year 2007-08) and financial year 2007-08 (assessment year 2008-09), the deduction is available only in respect of the interest without any ceiling limit.

There was no limit of Rs 40,000 even for the financial year 2006-07 (assessment year 2007-08).

My daughter pays a premium on a medical insurance taken for the benefit of myself, my wife and her dependent sister.

Will she be eligible for any deduction in respect of the premium paid? — Pratapan

Section 80D allows a deduction in respect of medical insurance premium paid by cheque out of income chargeable to tax.

The deduction under this section is restricted to Rs 15,000 and if the beneficiary of the premium is a senior citizen is restricted to Rs 20,000.

The deduction is available where the premium is paid to effect or to keep in force an insurance on the health of the assessee or on the health of the spouse, dependent parents or dependent children of the assessee, where the assessee is an individual.

The insurance premium paid by your daughter to insure yours and your wife’s health will therefore qualify for deduction under this Section subject to the overall limits stated above.

The insurance premium paid by your daughter to insure her dependent sister’s health, however, will not qualify for the deduction.

I am a physically disabled person working for a public sector bank.

Are there any deductions (benefits) available for me.

If yes, what are the criteria for claiming such benefits? — Arun

Section 80U allows a deduction to an individual who is resident and who at any time during the previous year is certified by a medical authority to be a person with disability.

The deduction under this Section is a sum of Rs 50,000 and if the person is suffering from a severe disability, a sum of Rs 75,000 is allowed.

The certificate of a medical authority is to be enclosed along with the return and the deduction under this Section will be allowed for the period covered by the certificate.

Disability means the same as is assigned to the term in section 2(i) of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 and includes autism, cerebral palsy and multiple disabilities referred to in sections 2(a), 2(c) and 2(h) of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999.

Person with disability means a person referred to in section 2(t) of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 or section 2(j) of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999. Person with severe disability means a person with 80 per cent or more of one or more disabilities referred to in Section 56(4) of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 or a person with severe disability referred to in the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999.

Medical authority means the medical authority referred to in Section 2(p) of Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 or a medical authority as may be notified by the Central Government for certifying autism, cerebral palsy, multiple disabilities, person with disability and severe disability referred to in Sections 2(a), 2(c), 2(h), 2(j) and 2(o) of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999.

You will have to examine whether you fit within these criteria for you to be able to claim the deduction.