Section 80C is believed to be among the most widely-used tax-saving strategies for people over the years. Investment possibilities are available under Section 80C for those looking to lower their tax obligations. The list of tax-deductible investments included in this section is rather extensive; just a few examples include PPF contributions and ELSS investments, along with tax-saver FDs. Of course, premiums paid for your term insurance policy and other life insurance coverage also qualify for these deductions.
Here’s a list of tax savings solutions which you may consider besides Section 80C
What are some of the best tax-saving strategies under Section 80?
1) “Section 80CCD”
Tax deductions are available for NPS (“National Pension Scheme”) contributions as per “80CCD”, according to a statement from the Central Government.
Employer, employee, and voluntary self-contributions are all eligible for deductions. In addition, self-contributions to “Atal Pension Yojana” or NPS as per “Section 80CCD” are also qualified for a further deduction of 50,000 under “Section 80C”, for a total deduction of 1,50,000 lakh rupees.
2) “Section 80D”
A tax credit of 5,000 is also available for health check-up costs under “Section 80D”.
The medical insurance deduction of Rs. 25,000/- or Rs. 50,000 (for non-senior and senior citizens, respectively, on health insurance premium payments) is also included in the deduction list. To put it another way, those who have paid 5,000 for medical check-ups may be entitled to a 20,000 deduction on their premium payments.
3) “Section 80DD”
It has to do with the tax deduction that may be used in the following circumstances:
- Individuals, as well as HUFs who pay for the care and well-being of a disabled family member, are qualified to seek exclusions as per “Section 80DD” on the entire amount spent
- Those with a 40-80% disability are eligible for a discount from the coverage limit
- Families taking care of a person accountable for over 80% disability are eligible to get 1.25 lakh to cover all of their associated costs. The dependent person’s family is the only one eligible for this benefit.
4) “Section 80DDB”
You might qualify for a tax exemption if you pay for a family member’s medical care once they are diagnosed with one or several health conditions. A maximum of 40,000 can be given to anyone below 60 years of age. As a result, older citizens, up to the age of 80, along with super seniors, are now eligible for waivers worth one lakh rupees (over 80 years old).
For the treatment of serious illnesses such as malignant malignancies, AIDS, haemorrhagic conditions, chronic kidney disease, and neurological disorders (producing 40% or more disability), a waiver may be granted.
5) “Section 80E”
The interest component of the EMI is subtracted during the financial year. There is no cap on how much can be subtracted.
Nonetheless, a bank certificate is necessary. The “principal and interest payments” for the student loan you made throughout the fiscal year should be indicated separately on this certificate.
There will be a deduction for the entire amount of interest paid. However, for the principal repayment, no deductions will be permitted.
An education loan might be secured or unsecured depending on the amount of money needed.
Yet it’s vital to remember that these deductions only apply to loan repayment for the first 8 years. Interest payments become taxable following eight years.
6) “Section 80EE”
First-time home buyers may be able to claim extra interest benefits up to 50,000 beyond “Section 24(b)” on EMIs, related to home loans if the value of the property is not more than 45 lakh rupees. However, an applicant is not allowed to have any other property before submitting a home loan application to qualify for a tax break on EMI payments as per “Section 80EE”.
7) “Section 80G”
Under Section 80G, a donation in its entirety to a charity organisation is not subject to taxation. There is no cap on these tax deductions if the transfers were made via banks.
Up to Rs. 2,000/- in cash gifts per year are excluded from tax computations. Nonetheless, these donations must go to organisations for charitable purposes that are registered.
8) “Section 80GG”
If an employer is not able to incorporate the HRA component in a person’s salary breakdown, “Section 80GG” would enable them to claim benefits on your whole taxable income. Tax deductions are given to the least of the following in all of the tax-saving investments besides “80C”:
- 5000 per month
- 25% of an individual’s total yearly income
- 10% of an individual’s basic yearly salary
Conclusion
As you may see, plenty of tax-saving options are already available, and you must consider them to make a sound financial portfolio that helps you save taxes. You can save taxes in several ways besides just leveraging term insurance benefits Section 80C, which will eventually improve your overall financial standing.
Read Next:
Business Advisors: How they can help your small business
