Following are the income tax rates for financial year 2008-2009:

A. Normal Rates of Tax

Where the total income does not exceed Rs.1,50,000/-.	Nil
Where the total income exceeds Rs. 1,50,000 but does not exceed Rs. 3,00,000/-.	10 per cent, of the amount by which total income exceeds Rs.1,50,000/-
Where the total income exceeds Rs. 3,00,000/- but does not exceed Rs. 5,00,000/-.	Rs. 15,000/- plus 20 per cent of the amount by which the total income exceeds Rs. 3,00,000/-.
Where the total income exceeds Rs. 5,00,000/-.	Rs. 55,000/- plus 30 per cent of the amount by which the total income exceeds Rs. 5,00,000/-.

B. Rates of tax for a woman, resident in India and below sixty-five years of age at any time during the financial year

Where the total income does not exceed Rs. 1,80,000/-.	Nil
Where the total income exceeds Rs. 1,80,000 but does not exceed Rs. 3,00,000/-.	10 per cent, of the amount by which total income exceeds Rs.1,80,000/-
Where the total income exceeds Rs. 3,00,000/- but does not exceed Rs. 5,00,000/-.	Rs.12,000/- plus 20 per cent of the amount by which the total income exceeds Rs. 3,00,000/-.
Where the total income exceeds Rs. 5,00,000/-.	Rs. 52,000/- plus 30 per cent of the amount by which the total income exceeds Rs. 5,00,000/-.

C. Rates of tax for an individual, resident in India and of the age of sixty-five years or more at any time during the financial year

Where the total income does not exceed Rs. 2,25,000/-.	Nil
Where the total income exceeds Rs.2,25,000 but does not exceed Rs. 3,00,000/-.	10 per cent, of the amount by which total income exceeds Rs.2,25,000/-
Where the total income exceeds Rs. 3,00,000/- but does not exceed Rs. 5,00,000/-.	Rs. 7,500/- plus 20 per cent of the amount by which the total income exceeds Rs. 3,00,000/-.
Where the total income exceeds Rs. 5,00,000/-.	Rs. 47,500/- plus 30 per cent of the amount by which the total income exceeds Rs.5,00,000/-.

Surcharge on income tax:
The amount of income-tax computed in accordance with the preceding provisions of this paragraph shall be increased by a surcharge at the rate of ten percent of such income tax where the total income exceeds ten lakh rupees.

However, the total amount payable as income-tax and surcharge shall not exceed the total amount payable as income tax on a total income of Rs.10,00,000/- by more than the amount of income that exceeds Rs.10,00,000/-.

Additional surcharge on income tax (Education Cess on income tax):
The amount of income-tax as increased by surcharge, if any, mentioned above shall be further increased by an additional surcharge (Education Cess on Income Tax) at the rate of two percent of the income-tax and surcharge.

Additional surcharge on Income Tax (Secondary and Higher Education Cess on Income-tax):
From Financial Year 2007-08 onwards, an additional surcharge is chargeable at the rate of one percent of income-tax and surcharge (not including the Education Cess on income tax).

Surcharge, Education Cess, and Secondary and Higher Education Cess are payable by both resident and non-resident assessees.

A circular from Central Board of Direct Taxes, Government of India, provides details on the income tax rates for financial year 2008-2009 (i.e., Assessment year 2009-2010) as well as rules for income tax exemptions and deductions.

What section of IT Act covers tax benefits for health insurance policies?

Section 80(D) of IT Act.

Scope

Health Insurance Premium paid for a health insurance scheme provided by any insurer in India that is approved by the Insurance Regulatory & Development Authority (IRDA).

Assessees Allowed Deduction

1. Individuals
2. Hindu Undivided Family (HUF)

Mode of Payment for Health Insurance Premium

Premium must have been paid by any mode other than cash to avail tax benefits.

Who is covered?

• Individual: Premium paid for insuring the health of the individual, spouse, parents and children.
• HUF: Premium paid for insuring the health of any member of the HUF.

Amount of Deduction Allowed

• For non-senior citizens: Amount of health insurance premium paid or Rs. 15,000, whichever is less.
• For senior citizens (any citizen who was 65 years or older during relevant tax year): Amount of health insurance premium paid or Rs. 20,000, whichever is less.

To encourage individual assessees to supplement the efforts of their parents to get medically insured, the government allows an additional deduction of Rs. 15,000 to an assessee, being an individual, on any premium payments made in effect to keep in force an insurance on the health of his/her parent or parents. In this case, the existing condition of dependent with respect to parents is dispensed with. This deduction will be in addition to the existing deduction available to individual assessee for medical insurance on himself/herself, spouse and dependent children. Further, if either of the individual assessee’s parents is a senior citizen and is medically insured, the deduction would be allowed upto Rs. 20,000 or the health insurance premium, whichever is lower.

For example, an individual pays (through any mode other than cash) health insurance premia as under during the previous year:

1. Rs. 12000 to keep in force an insurance policy on his health and the health of his wife and dependent children
2. Rs. 17000 to keep in force an insurance policy on the health of his parents.

He will be allowed a deduction of Rs 27,000 (Rs. 12,000 + Rs. 15,000) if neither of his parents is a senior citizen. If any of his parents is a senior citizen, he will be allowed a deduction of Rs. 29,000 (Rs. 12,000+Rs. 17,000). Whether his parents are dependents or not, is not a consideration for taking this deduction. In other words, you can avail of this deduction on parents’ health insurance premiums paid even if they are not your dependents.

Further, in the above example, if the cost of insurance on the health of parents is Rs. 30,000 out of which Rs. 17000 is paid (by any non-cash mode) by the son and Rs. 13000 by the parent (who is a senior citizen), out of their respective taxable income, the son will get a deduction of Rs. 17000 (in addition to the Rs. 12000 for medical insurance on self and family) and the father will get a deduction of Rs. 13000.

Consult your tax advisor for the exact computation of your deduction for health insurance premiums under section 80D and consequent tax liability when you file your taxes.

Feb 15, 2009, Ratekhoj.com. Banks in India have reduced their fixed deposit rates in recent weeks. For non-senior citizens (people below the age of 60), City Union Bank, a private sector bank, is offering the highest interest rate of 10.60 % for fixed deposits. This interest rate is being offered for a deposit period of 2 years. Development Credit Bank, also a private sector bank, is offering the next best interest rate of 10.50% on fixed deposits for non-senior citizens. This rate is being offered for a period of 1 year as well as deposit periods of over 1 year but less than 3 years. IDBI Bank is offering the highest fixed deposit interest rate among public sector banks of 9.50% for non-senior citizens for a term of 1100 days.

The highest fixed deposit rates for non-senior citizens as compiled by Ratekhoj.com based on their durations as of February 15, 2009 are as follows:

Duration	Institutions	Rate
3 months	Development Credit Bank	7.50
6 months	Development Credit Bank	8.50
1 year	Development Credit Bank City Union Bank Tamilnad Mercantile Bank	10.50
2 years	City Union Bank	10.60
3 years	Development Credit Bank Lakshmi Vilas Bank	10.50
4 years	City Union Bank	10.25
5 years	City Union Bank	10.25
>5 years	Tamilnad Mercantile Bank Lakshmi Vilas Bank	10.00

The top 20 fixed deposit rates for non-senior citizens as compiled by Ratekhoj.com across all FD terms as of February 15, 2009 are as follows:

Duration	Institutions	Rate
2 years	City Union Bank	10.60
1 year	Development Credit Bank	10.50
366 days-3 years	Development Credit Bank	10.50
1 year-2 years	City Union Bank	10.50
2 years-3 years	Lakshmi Vilas Bank	10.50
1 year	Tamilnad Mercantile Bank	10.50
2 years-5 years	City Union Bank	10.25
366 days-3 years	Development Credit Bank	10.25
400 days	IndusInd Bank	10.25
1 year-3 years	Tamilnad Mercantile Bank	10.25
1 year-2 years	Lakshmi Vilas Bank	10.25
1000 days	IndusInd Bank	10.25
1 year-2 years	Catholic Syrian Bank	10.10
1170 days	South Indian Bank	10.00
5 years-10 years	Tamilnad Mercantile Bank	10.00
3 years-5 years	Tamilnad Mercantile Bank	10.00
3 years-5 years	Lakshmi Vilas Bank	10.00
5 years-10 years	Lakshmi Vilas Bank	10.00
2 years-3 years	Catholic Syrian Bank	9.85
1 year-539 days	Jammu & Kashmir Bank	9.85

For senior citizens (people over 60), the best fixed deposit rate of 11.10% is offered by City Union Bank, a private sector bank. This interest rate is offered for a term of 2 years. The next highest rate of 11.00% is offered by Development Credit Bank for a term of 1 year as well as a term of 366 days to 3 years. Development Credit Bank is a private sector bank in India. Among public sector banks, IDBI Bank is offering the highest fixed deposit interest rate of 10.00% for a deposit period of 1100 days.

The highest fixed deposit rates for senior citizens as compiled by Ratekhoj.com as of February 15, 2009 based on their durations are as follows:

Duration	Institutions	Rate
3 months	Development Credit Bank	8.00
6 months	Development Credit Bank	9.00
1 year	Development Credit Bank City Union Bank	11.00
2 years	City Union Bank	11.10
3 years	Development Credit Bank Lakshmi Vilas Bank	11.00
4 years	City Union Bank	10.75
5 years	City Union Bank	10.75
>5 years	Lakshmi Vilas Bank	10.50

The top 20 fixed deposit rates for senior citizens as compiled by Ratekhoj.com across all FD terms as of February 15, 2009 are as follows:

Duration	Institutions	Rate
2 years	City Union Bank	11.10
1 year	Development Credit Bank	11.00
366 days-3 years	Development Credit Bank	11.00
1 year-2 years	City Union Bank	11.00
2 years-3 years	Lakshmi Vilas Bank	11.00
2 years-5 years	City Union Bank	10.75
366 days-3 years	Development Credit Bank	10.75
400 days	IndusInd Bank	10.75
1 year-3 years	Tamilnad Mercantile Bank	10.75
1 year-2 years	Lakshmi Vilas Bank	10.75
1000 days	IndusInd Bank	10.75
1 year	Tamilnad Mercantile Bank	10.75
1 year-2 years	Catholic Syrian Bank	10.60
3 years-5 years	Lakshmi Vilas Bank	10.50
5 years-10 years	Lakshmi Vilas Bank	10.50
2 years-3 years	Catholic Syrian Bank	10.35
1 year-539 days	Jammu & Kashmir Bank	10.35
1170 days	South Indian Bank	10.25
2 years-3 years	Catholic Syrian Bank	10.25
540 days-2 years	Jammu & Kashmir Bank	10.25

People interested in fixed deposit investments can compare fixed deposit rates at Ratekhoj for different durations to get the best interest rates.