- Date : 11/05/2022
- Read: 3 mins
To encourage savings and investments among taxpayers, the income tax department has provided various deductions from the taxable income. Most of you must be aware of the deductions under Section 80C of the Income Tax Act. However, other lesser-known tax deductions options can help you save additional tax.
To encourage savings and investments among taxpayers, the income tax department has provided various deductions from the taxable income. Most of you must be aware of the deductions under Section 80C of the Income Tax Act. However, other lesser-known tax deductions options can help you save additional tax.
Let us look at such options that can help you save tax:
Section 80CCD - You can claim tax benefits over and above the Rs 1.5 lakh limit under section 80C by investing in National Pension Scheme (NPS). The maximum amount you can invest for tax deduction is capped at Rs 50,000.
Section 80GG - You must know that you can claim HRA against the rent you pay every month to lower your taxable income. What if you have not received HRA? Under Section 80GG, you can avail a deduction for house rent paid where HRA is not received. Below are important points related to the deduction:
- You should be living in a rented house and paying monthly rent.
- You should not have self-occupied residential property elsewhere.
Section 80D - Health insurance acts as a cushion for you during a medical emergency. They also help you save taxes. Under Section 80D, you can claim a deduction up to Rs 25,000 per year for the premium paid towards health insurance. In addition, you can claim an additional deduction of Rs 25,000 on the insurance premium of your parents if they are below 60 years and Rs 50,000 if they are above 60 years.
Section 80E - If you have an existing education loan, you can claim a deduction on the interest you pay on loan in a particular financial year. 80E deduction is available for a maximum of 8 years or till the interest is repaid, whichever is earlier. You should know there is no restriction on the amount that can be claimed.
Section 80EE - Under this section, you get tax benefits on the interest part of your residential house property loan availed from the bank. You can claim a deduction of up to Rs 50,000 in a financial year. This deduction is over and above Rs 2 lakh limit under Section 24 of Income Tax Act.
Section 80G - Section 80G of the Income Tax Act permits deductions for contributions to relief funds and charitable institutions. There are, however, no deductions allowed under section 80G for all donations. Donations made to prescribed funds qualify for deductions. There are certain donations eligible for 100% deductions without a qualifying limit.
Section 80GGC - Contributions made to political parties are tax-deductible under section 80GGC of the Income Tax Act. Deductions can range between 50% and 100% of the amount contributed. In addition to tax savings, this model encourages a strong political system.
Section 80GGA - The donations you make towards scientific research or rural development come under Section 80GGA. This deduction is allowed to all taxpayers except those who have an income (or loss) from a business and a profession.
Also Read: Rs 3,50,000 Deduction From Taxable Income: Home Loan Benefits Under Section 80C And Section 24
Conclusion
As you can see from the above information, there are many other tax-saving options apart from Section 80C deductions. By knowing the various deductions, and their benefits, you can save tax and earn returns from them. So, next time when you file for Income Tax returns, look for these lesser-known deductions, and you can surely save your taxes.
To encourage savings and investments among taxpayers, the income tax department has provided various deductions from the taxable income. Most of you must be aware of the deductions under Section 80C of the Income Tax Act. However, other lesser-known tax deductions options can help you save additional tax.
Let us look at such options that can help you save tax:
Section 80CCD - You can claim tax benefits over and above the Rs 1.5 lakh limit under section 80C by investing in National Pension Scheme (NPS). The maximum amount you can invest for tax deduction is capped at Rs 50,000.
Section 80GG - You must know that you can claim HRA against the rent you pay every month to lower your taxable income. What if you have not received HRA? Under Section 80GG, you can avail a deduction for house rent paid where HRA is not received. Below are important points related to the deduction:
- You should be living in a rented house and paying monthly rent.
- You should not have self-occupied residential property elsewhere.
Section 80D - Health insurance acts as a cushion for you during a medical emergency. They also help you save taxes. Under Section 80D, you can claim a deduction up to Rs 25,000 per year for the premium paid towards health insurance. In addition, you can claim an additional deduction of Rs 25,000 on the insurance premium of your parents if they are below 60 years and Rs 50,000 if they are above 60 years.
Section 80E - If you have an existing education loan, you can claim a deduction on the interest you pay on loan in a particular financial year. 80E deduction is available for a maximum of 8 years or till the interest is repaid, whichever is earlier. You should know there is no restriction on the amount that can be claimed.
Section 80EE - Under this section, you get tax benefits on the interest part of your residential house property loan availed from the bank. You can claim a deduction of up to Rs 50,000 in a financial year. This deduction is over and above Rs 2 lakh limit under Section 24 of Income Tax Act.
Section 80G - Section 80G of the Income Tax Act permits deductions for contributions to relief funds and charitable institutions. There are, however, no deductions allowed under section 80G for all donations. Donations made to prescribed funds qualify for deductions. There are certain donations eligible for 100% deductions without a qualifying limit.
Section 80GGC - Contributions made to political parties are tax-deductible under section 80GGC of the Income Tax Act. Deductions can range between 50% and 100% of the amount contributed. In addition to tax savings, this model encourages a strong political system.
Section 80GGA - The donations you make towards scientific research or rural development come under Section 80GGA. This deduction is allowed to all taxpayers except those who have an income (or loss) from a business and a profession.
Also Read: Rs 3,50,000 Deduction From Taxable Income: Home Loan Benefits Under Section 80C And Section 24
Conclusion
As you can see from the above information, there are many other tax-saving options apart from Section 80C deductions. By knowing the various deductions, and their benefits, you can save tax and earn returns from them. So, next time when you file for Income Tax returns, look for these lesser-known deductions, and you can surely save your taxes.
