The Revenue Tax Act gives for numerous earnings tax deductions which could be claimed on the time of submitting of earnings tax returns. The overall taxable earnings (after decreasing the earnings tax deductions which have been claimed) can be taxed as per the Income tax slab rates of the person.
The Indian Revenue Tax Division encourages its residents to utilize the assorted Revenue Tax Deductions, Revenue Tax Exemptions and Revenue Tax rebates allowed below the Revenue Tax Act which assist the taxpayers to scale back their taxes in India legally. (Really helpful Learn: save Tax legally in India)
10 Helpful Revenue Tax Deductions to Save Taxes
There are numerous earnings tax deductions that are allowed to be claimed by an Particular person/HUF. The most helpful earnings tax deductions which could be simply claimed and are useful in decreasing the tax burden have been defined under.
1. Revenue Tax Deduction for Investments specified below Part 80C
The hottest earnings tax deduction is the deduction below Part 80C which is allowed for making investments in sure specified devices. There are lots of devices by which investments could be made and the cumulative complete of the deductions allowed below this Part is Rs. 1.5 Lakhs p.a. Some examples of specified devices are
- PPF Account
- Tax Saving Mutual Fund
- Tax Saving Mounted Deposit
- Nationwide Financial savings Certificates
- Reimbursement of Principal on Housing Mortgage
- Premium on Life Insurance coverage Coverage
- Fairness Oriented Mutual Funds
- Contribution to Worker Provident Fund
2. Revenue Tax Deductions for Contribution to Pension Funds u/s 80CCC & 80CCD
Deduction below Part 80CCC and Sec 80CCD are earnings tax deductions that are allowed for fee of any quantity to provoke or to proceed any annuity plan of any insurance coverage firm for receiving any pension, the person can be allowed a deduction for the quantity paid below Part 80CCC.
And in case the person has made the contribution to notified pension scheme of the Central Govt i.e. the Nationwide Pension Scheme (NPS), the person can be allowed a deduction below Part 80CCD.
Really helpful Learn:-
- Part 80CCC: Deduction for Contribution to Pension Funds
- Part 80CCD: Deduction for Contribution to Nationwide Pension Scheme
From monetary 12 months 2015-16 onwards, an extra deduction of Rs. 50,000 is allowed for funding in NPS Account. This extra deduction of Rs. 50,000 is over and above the deduction allowed to be claimed below Part 80C and Part 80CCC.
In different phrases, the cumulative complete of those shouldn’t exceed Rs. 2,00,000.
3. Revenue Tax Deduction below Part 80TTA for Curiosity on Financial savings Account
A deduction of Rs. 10,000 below Part 80TTA (laid out in Chapter VI-A) can be allowed to be claimed from the curiosity earned on Financial institution Financial savings Account. Such Curiosity Revenue is first added below head “Revenue from Different Sources” after which deduction from such earnings is allowed below Part 80TTA topic to a most of Rs. 10,000 p.a.
- Really helpful Learn: All about Deduction below Part 80TTA for Curiosity on Financial savings Account
4. Revenue Tax Deduction for Curiosity on Dwelling Mortgage below Part 24
If a taxpayer has taken any Dwelling Mortgage, he can be allowed to assert a deduction for the curiosity levied on such a mortgage. It must be famous that this deduction below Part 24 is for the Curiosity levied and never for the curiosity paid.
The principal quantity of Dwelling Mortgage repaid is allowed as a deduction below Part 80C and the Curiosity levied is allowed as a deduction below Part 24.
- Really helpful Learn: All about Deduction below Part 24 for Curiosity on Dwelling Mortgage
5. Part 80D: Deduction for fee of Medical Insurance coverage Premium & Well being Examine-up
If a person/HUF has made any fee for medical insurance coverage premium for himself, partner, dependent kids, he can be allowed to assert an earnings tax deduction for a similar. The deduction allowed below this part varies relying on whether or not the individual insured is a senior citizen or a non senior citizen.
If any quantity has been paid for preventive well being check-up, deduction can be allowed for such fee as properly.
- Really helpful Learn- Part 80D: Deduction for Medical Insurance coverage & Well being Examine-up
6. Part 80DD & Part 80U: Revenue Tax Deduction for Incapacity
If the person himself is disabled he can be allowed a deduction below Part 80DD and in case any dependent member of the family of the person is disabled, he can be allowed a deduction below Part 80U.
The disabilities for which the deductions below Part 80DD & Part 80U are allowed have additionally been outlined within the earnings tax act.
- Really helpful Learn: All about Deduction for Incapacity below Part 80DD & Part 80U
7. Part 80DDB: Revenue Tax Deduction for Remedy of Specified Ailments
Revenue Tax Deductions are additionally allowed for therapy of specified ailments. If an individual or any of his dependents is being handled for any specified illness, he can be allowed a deduction below Part 80DDB of the quantity really paid or Rs. 40,000 whichever is larger.
- Really helpful Learn: All about Deduction below Part 80DDB for Remedy of Illness
8. Part 80E: Revenue Tax Deduction for Curiosity on Training Mortgage
An Particular person is allowed an earnings tax deduction below Part 80E for Reimbursement of Curiosity on Dwelling Mortgage taken for the Larger Training of Self, Partner or Dependent Youngsters.
It must be famous that this deduction is just for the compensation of curiosity on schooling mortgage and never for the compensation of the principal quantity of the schooling mortgage. The great half about this earnings tax deduction is that there isn’t a most restrict on the quantity of deduction that may be claimed.
This Deduction shouldn’t be solely allowed for Training in India but additionally allowed for Training exterior India as properly.
- Really helpful Learn: Part 80E: Deduction for Reimbursement of Curiosity on Training Mortgage
9. Revenue Tax Deduction for Donations below Part 80G, 80GGA, 80GGB, 80GGC
If an individual has made any donation through the monetary 12 months to any accredited physique, he shall be allowed a deduction for a similar.
Deduction below Part 80G is a basic deduction whereas deductions below Part 80GGA, 80GGB & 80GGC are particular deductions.
Part 80GGA is for Donation for the aim of Scientific Analysis or Rural Improvement, Part 80GGB & Part 80GGC are for Donations given to Political Events.
- Really helpful Learn: Part 80G: Revenue Tax Deductions for Donations
10. Revenue Tax Deduction for Lease below Part 80GG
If an Particular person has paid Home Lease and he has not claimed earnings tax deductions for the Lease paid below another sections of the earnings tax act, he can declare a deduction below Part 80GG.
In different phrases, a salaried worker who has not availed of the HRA Exemption or another one who has not claimed bills for hire paid below another part of Revenue Tax Act, is allowed a deduction below this part topic to the bounds prescribed below Part 80GG.
- Really helpful Learn: All about Deduction for Lease paid below Part 80GG