Provisions for Saving Income Tax

 

You must invest in specific programmes by March 31 to qualify for income tax exemption for the any financial year. There are other parts in the Income Tax Act that can be used to get income tax exemptions; however, most people are only aware of sections 80C and 80D. To help you save the most tax possible, we are letting you know about them today.

Taxes on investments up to Rs.1.5 lakh can be avoided:-

Before the conclusion of the fiscal year, many people begin investing to reduce their tax liability. You are eligible for a deduction of Rs.1.5 lakh from your gross income under Section 80C. You can use section 80C to subtract up to Rs.1.50 lakh from your total taxable income. By investing in other programmes like term insurance, 5 year tax free FDs, ELSS (Equity linked saving schemes), and senior citizen savings plans, one can profit from this.

Tax exemption will be offered for medical insurance costs:-

Medical insurance expenditure deductions are allowed under Section 80D. According to this, one can avoid paying taxes on health insurance premiums for their own, their families, and their dependant parents' health. The maximum premium deduction allowed under Section 80D is Rs.25, 000 for an individual or family. Senior persons may deduct up to Rs.50, 000 from the cost of their subscription. In addition, a health checkup up to a maximum cost of Rs.5, 000 rupees is permitted and is included in the overall cap.

Rs.1.5 lakh interest on house loan rebate pursuant to 80EEA:-

Section 80EEA allows for an additional tax exemption of Rs.1.5 lakh on house loan interest.

Advantages of interest on student loans being excluded from taxes:-

The interest on student loan deduction is allowed by Section 80E. The individual, his spouse, or children must obtain the loan from a bank or financial institution for higher education in order to qualify for such a deduction (in India or abroad). This deduction is available beginning the year the loan begins to be repaid and continuing for the next seven years or until the debt is paid off, whichever comes first.

Interest on house loans is free from taxes:-

Landlords are permitted to deduct an extra Rs.50,000 (Section 24) from the interest on house loan EMIs under Section 80EE. However, the restriction is that neither your loan nor the value of the property may be more than Rs.35 lakh. At the time the loan is approved, a person also cannot have any other real estate registered in his name.

You will be eligible for a tax exemption even if you rent your home.

If you reside in a leased home while not receiving House Rent Allowance (HRA), you are still eligible for a tax exemption under Section 80GG of the Income Tax Act of 1961 on the rent that was paid to you. Rs.60,000 each year as defined by section 80GG. There is a maximum exemption of (Rs.5, 000 per month). If you (or your wife/child) own your own home, you are not eligible for the benefits of this section. You must fill out the 10BA form in order to receive the advantage of this section.

Using 80DDB to pay for treatment will save you tax

A tax deduction is granted under section 80DDB for the money spent on one of his dependents' serious and protracted illnesses. The money spent on medical care for one's wife, children, siblings who are dependent, and an income tax payer can deduct parents. These include conditions like AIDS, thalassemia, cancer, and haemophilia, among others. This reduction usually amounts to 40.000 rupees. This deduction might be up to Rs.1 lakh for older persons. A medical certificate is required for this.

80CCD (1B) will result in an Rs.50, 000 benefit.

If you have utilised the National Pension Scheme, section 80CCD allows you to get income tax benefits up to $50,000. (1B). by combining sections 80CCD (1B) and 80C, you can benefit from tax exemption up to a total of Rs.2 lakh in this way.

The cost of a handicapped person's treatment will be excused from taxes under 80DD

Under this clause, you are eligible for a tax exemption if you are spending money to treat a handicapped individual. Depending on the individual, a person with a handicap may have parents, a wife, children, siblings, or sisters. Any family member may attend a Hindu Undivided Family (HUF) case. The income tax exemption can be up to 75,000 rupees if the dependant relative is 40% or more handicapped but under 80%. The tax deduction will be Rs.1.25 lakh if the relative has a severe disability, which is defined as more than 80%. For this claim, a disability certification from a reputable medical organisation is necessary.