How to save Income Tax: 5 investment options beyond Sec 80C you should explore
There are many saving tools which allows the individual to save on tax deductions. Under Section 80C, an individual is granted claims over deduction up to Rs 1.5 lakh. These claims can be made over deduction on ELSS, PPF, tax saver fixed deposits, national savings certificate and senior citizen savings scheme. However, there are other ways through which one can save on taxes apart from investments made under Section 80C. Some of them are health insurances, education loans, home loans and donations to name a few. These are claims that you can avail under the Income Tax Act but tend to rule out due to unawareness. So, apart from Section 80C, the following are the sections under the Income Tax Act, via which you can make claims on your deductions.
Section 80D on Medical Insurance Premiums:
Every individual should get medical insurance as you never know what life will present to in the next second. These are a must in today’s life as medical bills are sufficient enough to cut through your wallet. However, the premium paid for such med-claims is put under the radar of the Income Tax.
But under Section 80D, one can make a claim on the deduction on med-claim premiums. For this one needs to ensure that the premiums are made through any mode apart from cash. It should also be noted that the insurer should be approved by either Insurance Regulatory and Development Authority of India or the central government, to make a claim under this section. One can make claims up to Rs 1,00,000 under the Section 80D of the Income Tax Act.
Section 80E on Interest on Education Loans:
Education and educational courses have definitely skyrocketed when it comes to charges. Many apply for educational loans when it comes to getting funds for an individual’s higher education or college/university admissions. Here too, the interest on the loan falls under the Income Tax deduction and hence can be claimed by the individual.
One should make sure that the claim can only be made for course post grade 12. Moreover, the deduction on the interest rate starts from when the loan was applied for. The claim can be made post 8 years or until full repayment, whichever comes first.
Section 80EE on Interest on Home Loans:
Owning a house is every individual’s dream and to provide for the fund for its possession or construction, many apply for home loans. Here the premium one pays for the home loan is eligible for deduction under the Income Tax Act.
With Section 80EE, however, the individual can make claims on the deductions on this interest. It is to be noted that this claim is only valid for those who have no other property under their name when the loan was sanctioned. Moreover, the value of the house should be Rs 50 lakhs or less and the loan applied for should be Rs 35 lakhs or less. If the conditions match, then one can avail tax benefits up to Rs 50 lakhs under this section.
Section 80G on Donations and charities:
Contributions donated to notable organisations and relief funds are taxed as well but the deductions can be claimed under Section 80G of the Income Tax Act. It is to be noted that deductions cannot be claimed if the donation exceeds Rs 2,000. To claim on deductions on donations above Rs 2,000, the contribution should be made by any other mode apart from cash to avail it.
Section 80TTA on Interest on savings account:
Deduction under the Income Tax Act is also levied on interest gained on savings account. This saving account is with a bank or post office. Under Section 80TTA, one can claim Rs 10,000 on their interest on savings accounts. If your interest falls below the said amount, Then you claim the entire interest. If it is more than Rs 10,00, then you can claim only up to Rs 10,000. Here, one needs to consider total interest of all savings accounts one holds.