Tax saving schemes other than 80c of Income Tax Act

Tax saving schemes other than 80c of Income Tax Act

Apart from the deductions available under Section 80C of the Income Tax Act, there are other tax-saving schemes and investments that can be considered for reducing your tax liability. Some of these schemes are:

1. National Pension System (NPS): Contributions made to the NPS are eligible for a deduction under Section 80CCD(1B) of the Income Tax Act, up to a maximum of Rs. 50,000 per financial year.Contributions made to the National Pension System (NPS) are eligible for deduction under Section 80CCD of the Income Tax Act, 1961. The deduction is available to individuals, including self-employed individuals, and HUFs. The maximum deduction available under this section is 10% of the individual’s gross total income, subject to a maximum limit of Rs. 1.5 lakh per year. An additional deduction of up to Rs. 50,000 is available for contributions made towards the Tier 1 account of the NPS, under Section 80CCD(1B). The total deduction available for contributions to the NPS is Rs. 2 lakh per year (i.e. Rs. 1.5 lakh under Section 80CCD and Rs. 50,000 under Section 80CCD(1B)). The NPS is a government-sponsored pension scheme that aims to provide retirement benefits to subscribers. The contributions made to the scheme are invested in various asset classes, including equity, debt and government securities, based on the subscriber’s preference.
2. Health Insurance Premium: Premiums paid towards health insurance policies for self, spouse, and dependent children are eligible for a deduction under Section 80D of the Income Tax Act. The deduction limit varies based on the age of the individual and the type of health insurance policy. Premium paid for health insurance is eligible for deduction under Section 80D of the Income Tax Act, 1961. The deduction is available to individuals and HUFs for the premium paid towards the health insurance of self, spouse, dependent children and parents. The maximum deduction available under this section is Rs. 25,000 for self, spouse and dependent children, and an additional Rs. 25,000 for the health insurance of parents. For senior citizens, the maximum deduction available is Rs. 50,000. Thus, a taxpayer can claim a maximum deduction of Rs. 75,000 if he or she pays the health insurance premium for self, spouse, dependent children and senior citizen parents.
3. Interest on Home Loan: The interest paid on a home loan is eligible for a deduction under Section 24(b) of the Income Tax Act, up to a maximum of Rs. 2 lakh per financial year.
4. Donations to Charitable Organizations: Donations made to specified charitable organizations and institutions are eligible for deduction under Section 80G of the Income Tax Act, up to a certain limit.
5. Medical Expenses for Specified Diseases: Expenses incurred towards the treatment of specified diseases such as cancer, AIDS, and neurological diseases are eligible for a deduction under Section 80DDB of the Income Tax Act.

It is important to note that the deduction limits and eligibility criteria for these tax-saving schemes and investments may vary based on the specific provisions of the Income Tax Act. It is advisable to consult a tax expert or a financial planner before making any investment or claiming any tax deduction.

( CA Satbir Singh : Taxheal@gmail.com )