Deductions

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

24 February 2015 Hi all,
Certain deductions are made from my salary like PENSIONERS MEDICAL COHESION FUND AND WORKMEN WELFARE SAMITEE. My query is wether these are allowed as deduction while computing income tax or not.

Querist : Anonymous

Querist : Anonymous (Querist)

24 February 2015 please reply to my query.

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
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20 July 2024 Deductions from salary for purposes such as "Pensioners Medical Cohesion Fund" and "Workmen Welfare Samitee" are typically not allowed as deductions while computing income tax under the provisions of the Income Tax Act, unless specifically provided for in the Act.

Here’s a general overview of how deductions from salary are treated for income tax purposes:

1. **Statutory Deductions**: Deductions like Provident Fund (PF), Employees' State Insurance (ESI), and contributions to pension funds that are mandatory under the law (like NPS - National Pension System) are allowed as deductions under various sections of the Income Tax Act.

2. **Voluntary Deductions**: Deductions made voluntarily by the employee for certain welfare funds or other purposes are generally not allowed as deductions for income tax purposes. This includes deductions like the ones you mentioned such as Pensioners Medical Cohesion Fund and Workmen Welfare Samitee.

3. **Section 80 Deductions**: Apart from statutory deductions, the Income Tax Act allows deductions under Section 80 for specific categories such as investments, payments, and expenditures. However, these deductions are for specified purposes like life insurance premiums, contributions to provident funds, tuition fees, etc., and do not typically cover voluntary deductions for welfare funds.

4. **Tax Planning**: It's important to differentiate between deductions that are mandatory (statutory) and those that are voluntary or discretionary. If the deductions are not provided for in the Income Tax Act or specified as eligible under any section, they cannot be claimed as deductions while computing taxable income.

Therefore, unless these deductions are specifically allowed under a relevant provision of the Income Tax Act or Rules, they would not be eligible for deduction while computing income tax liability. It’s advisable to consult with a tax advisor or chartered accountant for specific guidance based on the exact nature of these deductions and any relevant exemptions or provisions that may apply.

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