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Wednesday, October 7, 2020

Not only Section 80C of the Income Tax Act but also these 10 types can save more from income tax

Not only Section 80C of the Income Tax Act but also these 10 types can save more from income tax

Before filing income tax, most people have a question in their mind about how to save more tax. Generally people are aware of the income tax exemption available on 5 year fixed deposit or other savings scheme, but they are not aware of many other income tax exemptions. Because of this they cannot take full advantage of income tax exemption. Abhay Sharma, former Chairman Indore Chartered Accountant is telling you about some such sections of the Income Tax Act. With the help of which you can save tax.

Section 80C

Section 80C of the Income Tax Act is in fact part of the Income Tax Act, 1961. It mentions the means of investment in which an income tax exemption can be claimed by investing. Many people start investing to save tax before the end of the financial year. A deduction of Rs 1.5 lakh from your total income can be claimed under Section 80C of the Income Tax Act. To put it simply, you can deduct Rs 1,50,000 from your total taxable income by clicking 80C.

Section 80D

Section 80D is a deduction on medical expenses. Taxes on medical insurance premiums paid for the health of oneself, family and dependent parents can be saved. Section 80D deduction limit of premium paid for self / family is 25 thousand rupees. For the premium paid for senior citizen parents, you can claim a deduction of up to Rs 50,000. In addition, health checks up to an additional limit of Rs 5,000 are also allowed and are included in the entire limit.

Section 80DD

You can get tax exemption under this section if you are spending for the treatment of a disabled person. A person with a disability can have parents, wife, children, brother and sister depending on the person concerned. In the case of Hindu Undivided Family (HUF), the family can be any. The total deduction limit under this section is up to Rs. 1.5 thousand.

Section 80E

Section 80E provides interest deduction on education loans. The important condition associated with claiming such a deduction is that the loan must have been taken by a person or his spouse or children from a bank or financial institution for higher studies (in India or abroad). One can claim this deduction from the year in which the loan starts to be repaid and for the next 7 years (i.e. 8 years of the total assessment) or before the loan is repaid, whichever is earlier.

Section 80EE

Section 80EE allows homeowners to claim an additional deduction of Rs. 50,000 (Section 24) on the interest on home loan EMI. However, the loan is Rs. 35 lakhs and the value of the property should not exceed 50 lakhs. In addition, a person should not have any other assets registered in his name at the time of loan approval.

Section 80G

You can take advantage of tax breaks under 80G by donating to organizations working for social benefit. Under section G0G of Income Tax, any person can get tax exemption on donations made to HUF or company to any fund or charitable organization. The condition is that the organization to which you make this donation must be registered with the government. In some cases deduction claims can be up to 100%, in some up to 50% or in some without a limit. Donations can be made by check / draft or in cash. But donations above Rs 2,000 will not get the benefit of tax deduction.

Section 80GG

If you do not get a House Rent Allowance (HRA) but you live in a rented house, you can still get a tax deduction on the rent paid under Section 80GG of the Income Tax Act, 1961. An exemption of 60,000 (Rs. 5,000 per month) per annum is allowed under Section 80GG. You will not get the benefit of this section if you (or your spouse / child) own a home. You will need to fill out a 10BA form to claim the benefits of this section.

Section 80TTA

Section 80TTA of the Income-tax Act, 1961 provides for deduction of up to Rs.10,000 on income earned from interest on savings accounts. This exemption is available to individuals and the Hindu Undivided Family (HUF). If the bank's interest income is less than Rs 10,000, then full deduction will be allowed. However, if the bank's interest income is more than Rs 10,000, the subsequent amount will be taxable.

Section 80DDB

Under Section 80DDB, one of his dependents gets income tax deduction on the amount spent on treatment of serious and chronic illness. An income tax payer can claim a deduction for the treatment of his parents, children, dependent siblings and wife. These include diseases such as cancer, hemophilia, thalassemia and AIDS. Usually this deduction is 40 thousand rupees. In the case of senior citizens, the deduction is Rs. Can be up to 1. For this, it is necessary to get a certificate from a doctor.

Section 80CCD (1B)

If you have availed the benefit of National Pension Scheme, you can avail income tax benefit up to Rs. 50,000 under Section 80CCD (1B). This way you can avail tax exemption up to a total of Rs 2 lakh by combining Section 80 CCD (1B) and 80C.

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