In a financial year, individuals can optimize tax savings by leveraging deductions available under various Sections of the Income-Tax Act (ITA), 1961. Here’s a breakdown of key deductions and how you can make the most of them:
-
Section 80C:
Invest in:
Life insurance premiums for yourself, spouse, and children
Employee Provident Fund (EPF)
Public Provident Fund (PPF)
Five-year Tax-Saving Fixed Deposit
National Savings Certificate (NSC)
Equity-Linked Savings Scheme (ELSS)
National Pension System (NPS)
Sukanya Samriddhi Account (SSA)
Senior Citizen Savings Scheme (SCSS)
Home loan principal repayment
Tuition fees for up to two children in India
Maximum deduction: Amount invested or Rs 1.5 lakh, whichever is lower.
-
Section 80D:
Premiums paid towards health insurance:
Self, spouse, and children: Maximum deduction of Rs 25,000 (Rs 50,000 if a senior citizen)
Parents: Maximum deduction of Rs 25,000 (Rs 50,000 if parents are senior citizens)
Payment mode: Electronic modes excluding cash.
-
Section 80CCD:
Contributions to National Pension Scheme (NPS):
80CCD(1): Up to 10%/20% of salary, with a maximum deduction of Rs 1.5 lakh.
80CCD(1B): Additional deduction of up to Rs 50,000.
80CCD(2): Deduction for employer’s contributions (14% for government employees, 10% for others).
-
Section 24:
Deduction for home loan interest:
Maximum deduction: Interest paid or Rs 2 lakh, whichever is lower.
Conditions: Completion of house construction/acquisition within five years.
-
Section 80TTA:
Deduction for interest earned on savings account balance:
Maximum deduction: Interest earned or Rs 10,000, whichever is lower.
Applicability: Individuals and Hindu Undivided Families (HUFs) below 60 years.
By strategically utilizing these deductions, individuals can significantly reduce their taxable income and maximize tax savings. It’s essential to stay informed about eligibility criteria and documentation requirements to ensure full advantage of available tax benefits.
🚀 Ready to level up your finances? Say goodbye to tax woes with Savingz! 🎉
Our app offers effortless tax planning & filing, saving high-income earners like you time and money.
Join now for exclusive CA👩🏻💼 call with us and start maximizing your wealth today! 💰📲 Download Our App Link: https://savz.live/app
Savings starts with Savingz.
A word from our Founder 🚀
