3.    A Women, Married or Single, can Save Income Tax - How ?

A woman, whether married or single, can save a great deal of income tax through proper tax planning. However, many women are ignorant about their rights and duties under the Income Tax Act and do not know the legal methods of saving tax by taking advantage of the various provisions for exemptions, deductions, rebates and reliefs under the Income Tax Act. Below are some of the most important aspects of tax planning through which a woman, Married or Single can save a good deal of income tax.

A Woman Can be an Independent Tax Payer

Like a man, a woman can also be an independent tax payer in her own right. Her income need not be added, i.e. clubbed with the income of her husband. A woman does not have to pay any income tax if her net total income does not exceed ` 2,00,000 during the F.Y. year 2012-2013 (assessment year 2013-2014). Thus, a woman taxpayer enjoys the same tax benefit as that of man.

Woman Senior Citizen Enjoys More Benefits

The basic Income-tax exemption for a woman taxpayer who is of the age of 60 years and above is ` 2,50,000 for the financial year 2012-2013. Likewise, a woman tax payer who is a very senior citizen of 80 years and above age would enjoy tax exemption of ` 5,00,000 for the financial year
2012-2013.

Avoid Gifts from Three Categories of Relatives

Avoid Taking Salary from a Business Concern in which Husband is Interested

A woman should avoid taking salary from a concern in which the husband is substantially interested, say a proprietary concern or a concern in which the husband has more than 20% stake in the profits. However, where a woman holds techniãal or professional qualifications and receives salary in exercise of her duties due to the possession of such qualifications, no addition would be made in the income of the husband in respect of salary received by a woman. It is clearly so laid down in Section 64 of the income Tax Act.

A Woman Can Own a House in Her Own Name

A woman can be the owner of a house or a flat in her name and get it accepted as such in the Income tax department. She can also own it as a co-owner of the house along with her husband or any other relative. A woman would be treated as a separate co-owner in her own right under the provisions of Section 26 of the Income Tax Act provided she Iinances the ownership of the house either by loan or through other sources herself. A woman can also get a loan for acquiring a self-occupied house and get deduction in respect of interest up to ` 1,50,000 every financial year.

A Woman Can Make a Trust for an Unborn Person

A woman can plan to have one trust for an unborn person, such as a would-be son, would-be daughter, would-be son-in-law or a would-be daughter-in-law by keeping the provisions of Section 164 of the Income Tax Act in view, i.e. only one trust should be so formed and none of the beneficiaries should to have any taxable income. In such a trust she can be the sole trustee or appoint more trustees and enjoy the exemption limit of ` 2,00,000 separately for such a trust, for the FY 2012-2013 (AY 2013-2014), which would provide good tax saving for future.

Deduction oh Investments up to Rupees One Lakh