New Delhi:
As the financial year 2023-24 approaches its end, individuals are actively seeking ways to save on income tax.
Whether you’ve been diligently managing investment proofs or are just getting started, there’s still time to explore avenues for tax savings.
Surprisingly, those with a salary up to ₹8 lakh can potentially save the entire tax amount through various deductions.
Here are 10 effective options to alleviate income tax stress:
1. Investment in LIC, EPF, PPF, and Pension Schemes
Leverage Section 80C for tax exemptions on premiums of LIC policies, EPF, PPF, children’s tuition fees, NSC, and home loan principal.
Utilize Section 80CCC for tax exemptions on annuity plans (pension plans).
2. Save Tax with Home Loan
Avail tax exemption on home loan principal under Section 80C, capped at ₹1.5 lakh.
3. Home Loan Interest Tax Exemption
Benefit from tax exemption on home loan interest under Section 24(b), up to ₹2 lakh for ‘self-occupied’ properties.
4. Invest in NPS
Invest in NPS for an additional exemption of ₹50,000 under Section 80CCD (1B).
Claim employer’s contribution under Section 80CCD(2), subject to specific conditions.
5. Health Insurance Premium
Claim premium under Section 80D for health insurance policies.
Up to ₹25,000 for self, spouse, and children (below 60 years), and up to ₹50,000 if parents are senior citizens.
6. Expenses for Treatment of Disabled Dependents
Claim expenses on the treatment or maintenance of disabled dependents, up to ₹75,000 (disability 80% or more).
7. Tax Exemption on Payment for Medical Treatment
Deduction of up to ₹40,000 under Section 80DD 1B for specific illness treatment. If a senior citizen, the limit is ₹1 lakh.
8. Tax Exemption on Education Loan Interest
Unlimited tax deduction on interest on education loans for up to 8 years. Applicable for two children together.
9. Rebate on Loan for Electric Vehicles
Claim tax exemption up to ₹1.5 lakh on interest payment for loans taken to purchase electric vehicles (Section 80EEB).
10. House Rent Payment
If HRA is not part of your salary, claim house rent payment under Section 80GG.
Explore these avenues to optimize your tax savings and alleviate the burden, even if your salary is up to ₹8 lakh.
