Tax Saving/Planning Rules
Once earning starts next major
step is to plan some savings and in such a way that tax
is also saved. Planning your taxes means planning your investments
systematically and methedologically to avail maximum possible
First part in tax savings is to be aware about all possible Deductions
that can be claimed from your taxable income.
Most commonly claimed eligible deductions for tax saving are:
- Deduction u/s 80C of upto ₹ 1,50,000,
- 80CCD of upto ₹ 50,000 for NPS
- 80D of upto ₹ 1,00,000 for
- 80TTA of ₹ 10,000 for Savings bank interest
& for senior citizens 80TTB of ₹ 50,000 for interest
on savings as well as deposit accounts &
- 80G for donations to various Charitable
Apart from these common deductions, there are many other deductions
specific individuals under given circumstances. Just have a look at
them if they might be applicable to you.
I have outlined here all possible deductions common as well
as some specific deductions. Check this out, I am sure it will help you
plan your tax savings:
entire limit of ₹150000 under Section
To start tax planning, just ensure
that you have availed entire limit of ₹
80C. Tax deduction under section 80C inlcudes following
investments & expenses:
- Investment in PPF, NSC, Life Insurance Premium,
Equity Linked Savings
Schemes (ELSS), SSA and other tax saving schemes.
- House Loan Repayment - Only principle part of loan
- Tution fee of two children etc.
When we are discussing about Section 80C, lets read in detail about
various investment options for Section 80C:
Fund - Everything about PPF-Read here
National Savings Certificate - Know about Pros & Cons of NSC
Linked Savings Scheme-ELSS
Account- "Beti Padhao Beti Bachao"
Tax Saving Fixed
Interest on House Loan upto ₹2,00,000
Buying a house is a good option as it brings many benefits. Apart
from being a long term investments it has tax advantages too. Interest
on home loan is eligible as deduction upto ₹
priniple part of home loan repayment is eligible for deduction under
Section 80C within the overall limit of ₹
case both husband and wife are taxpayer, better option is to purchase
house in joint names with joint loan. This will result in tax
benefit to both for principal repayment and Interest ( ₹2.00 Lac).
other words both the owners will get deduction of ₹ 2.00 Lac for
interest i.e. total ₹ 4 lacs for owning a house jointly.
Everything about Tax benefits
of investing in a House Property
₹50,000 for investment in NPS
To promote savings for retirement, an additional deduction of ₹50,000
was introduced from financial year 2015-16 for investments
in National Pension Scheme(NPS). This deduction of ₹50000 is
above the limit of Section 80C of ₹
in detail about contribution to NPS and Deduction thereon of ₹50,000
Mediclaim Insurance Premium & Preventive Helath Check ups u/s 80D
promote health care and motivate people for medical insurance, Govt has
provided deduction under Section
of upto ₹25,000 (₹50,000 in case of senior citizen) for medical
insurance paid other then by cash & preventive health checkups.
Medical insurance can be for self, spouse
and depedent children.
Additional deduction of ₹25000 (₹50,000
in case of senior citizen) is allowed for medical insurance &
preventive health check ups for
80D also provides for deduction of max ₹50,000 for
amount spent on medical treatment for self, family or parents
but the treatment shall be of a
senior citizen who is not having any medical/health insurance.
This deduction of Section 80D is in addition to
₹1,50,000 deduction of Section 80C.
complete analysis of Section 80D allowing you to avail deduction of ₹50,000 to ₹1,00,000
term Covid Specific Health Insurance-Corona Rakshak & Corona Kawach
Deduction for Bank Interest u/s 80TTA & 80TTB
Saving Bank Interest is a taxable income but same is also
allowed as deduction upto ₹10,000 or we can say there is savings bank
interest upto ₹10,000 is not taxable.
Savings bank interest exempt upto ₹10,000 u/s 80TTA-Read in detail
For senior citizens this relief is extended to include deposit
interests too. Interest from savings bank and from deposits upto ₹
50,000 is not taxable for senior citizens.
Interest exempt for Sr. Citizens upto ₹50,000 u/s 80TTB-Read in detail
Other Deductions available under specific conditions or to specific
Deduction for Medical treatment of specified disease u/s 80DDB
A Deduction U/s 80DDB is also there for expenses incurred on medical
treatment of certain specified disease on self or dependent.
in detail about Section 80DDB
- Deduction for
interest on Education Loan u/s 80E
is a deduction U/s 80E of the Income Tax Act to promote
higher education. The interest on loan taken for higher education of
self, spouse or children is eligible for deduction u/s 80E.
in detail about Section 80E
- Deduction for
Rent paid u/s 80GG
you are not in receipt of HRA, there is a tax relief provision
rent paid under Section 80GG, which is known to very few
detail about Section 80GG
80U to Differently abled persons
80DD for differently abled dependents
- Deduction for
Differently abled persons u/s 80DD & 80U
there is Income Tax Deductions to Differently
abled persons U/s 80U & for maintenance of differently abled
dependents u/s 80DD. Read in detail about the Income Tax benefits
Donations to approved Charitable Organisations u/s 80G
Donations to approved Charitable Organisations
are eligible for 50% to 100% deduction. Generally Government regulated
funds are eligible for 100% deduction without any limit
on the amount of donation and other private charitable organisations
which are approved for 80G deductions are eligible for 50% deduction of
the amount of donation.
Donation to organisation (NGOs) which are not approved for 80G
dedutions will not be eligible for 80G deduction.
To claim the dedction U/S 80G do ensure that your PAN is entered
correctly at the time of
making the payment for donation. Another important aspect is do keep
the receipt of donation as you need to enter PAN & address of the
organisation in your ITR for claiming deduction.
Address of CM Relief Fund-ASSAM
Address of PMNRF
donate to PMNRF online
- How to
Donate to PMCARES Fund
- PAN &
Address of PMCARES
to donate to Kerala Chief Minister's Distress Relief Fund
& Address of Kerala Chief Minister's Distress Relief Fund
Above is the complete list of possible deductions from taxable income. Write to
Arpita for more information on various admissible deductions or for any othe issue at firstname.lastname@example.org
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