Ways to reduce my Tax

                                                                       


In India the taxpayers are classified into different categories based on their type of source of income. This article is mainly for salaried people. Income tax are levied directly on the net salary of an employee irrespective of his expenses.  However, some sections are there in Income Tax Act to save salaried employees from tax burden.  The followings are the main keys for salaried employees. 


1. Section 80C :

                          This section is the the most commonly used section for tax savings. This section includes Public Provident Fund (PPF),  Employees Provident Fund (EPF),  equity linked savings scheme, Housing loan repayment (principle) Stamp duty and registration charges while purchasing a  residential property, Life Insurance Premium, children's tuition fee, National saving certificate, Senior citizen saving Scheme, Tax saving FD for 5 years, infrastructure bonds etc. However, this section has threshold limit of Rs.1,50,000. It can be quickly exhausted in a year for high salaried people. 

2. Section 80CCD :

                        You can invest further more Rs. 50,000 in NPS (National pension scheme) which gives you the option of claiming tax deduction of  upto Rs. 2,00,000 every year by investing in NPS.

3. Section 80D : 

                       Taxpayers can claim a deduction of Rs. 25,000 for payment towards Health Insurance paid for self or spouse or children. Additional deduction Rs. 25,000 allowed in case if health insurance premium paid for parents. If parents are aged more than 60 years, the maximum exemption limit extends to Rs. 75,000. If the both individual (tax payer)  and his parents are aged above 60 years, then total of Rs. 1,00,000 claimed as deduction under section 80D.

4. Section 80E :

                          The interest on educational loan taken for self, spouse, children or any other student to whom you are a legal guardian can be claimed as detection without any threshold limit. Actual amount paid can be deducted for seven years from the date of starting of repayment or closure of loan, which is earlier. This benefit is only available when the loan is taken from a approved financial institutions and the loan amount must utilized for purpose of higher education. 

5. Section 24 :

                         Tax payers can claim the Interest on Housing loan as deduction upto Rs. 2,00,000 for self occupied property. If the House is let out, then full amount of interest can be deducted provided that the rent received should be offered as income. 

6. Section 80EE :

                         When the loan is taken for first home, then a additional of Rs. 50,000 can be claimed under section 80EE. This amount is beyond that previous said 2 lakhs. 

But the condition for such availment is value of house should below Rs. 50 lakhs and value of loan is below Rs. 30 lakhs and loan should be sanctioned between April 1, 2016 and March 31, 2017. 

7. Section 80 EEA : 

                           When the loan is taken is for first home, then a additional deduction of Rs. 1,50,000 can  be claimed more than that 2 lakhs. 

But the condition for such availment is that the stamp duty value of house should be less than Rs. 45 lakhs and the housing loan should be sanctioned between April 1, 2019 and March 31, 2020.

8. Section 80 GG : 

                               You can claim deduction of maximum upto Rs. 60,000 for payment towards Rent paid for accomodation. This deduction is only allowed when you do not get any HRA (House Rent Allowance) as a part of your salary and you need to submit Form No. 10BA.


                                                   Still you need more deduction, i am sorry buddy. You are in the wrong nation. You are living in a nation where profit of individual considered as profit of Government and loss of individual is considered as loss of individual.

              

Comments

Robert steveson said…
You are giving such interesting information. It is great and beneficial info for us, I really enjoyed reading it. Thankful to you for sharing an article like this.best accountant for tax return in durham

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