A rise in your income means that you will have to pay more taxes. This is the reason why taxpayers always look for different ways to pay a minimum tax on their salary.
Everyone looks for a financially stable future, for themselves and their families. The only problem we face to ensure this is the amount of tax that we pay. A rise in your income means that you will have to pay more taxes. This is the reason why taxpayers always look for different ways to pay a minimum tax on their salary.
Today we will tell you about such deductions and tax saving instruments that can reduce tax burdens.
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What are the different components in a Pay Slip
Basic Salary
Dearness Allowance
HRA
LTA
Reimbursement
Children Education and Hostel allowance
House Rent Allowance
Standard Deduction
Professional Tax
If you want to pay lesser taxes, here are some deductions that you can avail
Section 80D: Paying Health Insurance Policy Premium
For self, spouse, and depedent children (Rs 25,000 (Rs. 50,000 if aged 60 and above)
For parents: Rs 25000 (Rs. 50,000 if aged 60 and above)
Section 80E
Tax deduction on the “interest component” paid against the loan taken for the higher education of a particular assessee for 8 years
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Section 80C
Specified investment and payment options such as ELSS, EPF, PPF, Fixed deposit for 5 years, Sukanya Samriddhi Yojana, among others.
Section 80DD
Allows deduction to the extent of Rs 75,000 (disability is 40% or more but less than 80%) & Rs 1,25,000 (in cases of severe disability - 80% or more)
Section 80G
It is an income tax benefit given on donations made to certain charitable institutions- 50% or 100% of the eligible amount (T&C)
Home Loan Payments
Can enjoy deducation up to Rs 2 lakh on a new house
On principal amount: Up to Rs 1.5 lakhs u/s 80C
On interest amount: Up to Rs 2 lakhs u/s 24b
Life Insurance Policy Maturity
Maturity will be exepted of tax ibn certain conditions;
20%: Policies issued before 1 April 2012
10%: Policies issued after 1 April 2012
15%: Policies issued after 1 April 2013 for a person with disability or disease.
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