Everyone wants to save tax. Are you known that there are many other ideas to save tax other than Section 80C of Income Tax Act, 1961? There are various sections of tax deductions under the Income Tax Act, 1961.
Are you ready to know that how much tax you will pay to the government in the form of Income Tax? You should know some other sections of tax deductions under the Income Tax Act as tax planning does not end with Section 80C. There are many other tax deductions provided by the Income Tax Act, 1961.
- 1. Section 80D (Mediclaim Policies)-
This section qualifies for mediclaim policies. The premium that is paid to medical insurance policy for yourself and your family members for sudden medical expenses. The maximum amount allowed for exemption yearly-
- a. For Self, Spouse and Dependent parents or children is Rs. 15,000
- For Senior Citizen is Rs. 20,000/-
- For Premium of Your Parents- if you are paying the premium for your parents (Whether dependent or not), you may claim an additional maximum deducted of Rs. 15,000/-
- 2. Section 80DD (Life Insurance for Medical Treatment)-
If you are paying a premium of any life insurance company for the medical treatment of a dependent physically disable person, you may avail exemption under section 80DD. There are two categories for disability-
- 40% Disability – if the person is suffering from 40% of any disability, a fixed sum of Rs. 50,000/– can be claimed in a year.
- 80% Disability – if the person is suffering from 80%, the fixed sum of Rs. 100,000/- can be claimed in a year.
- 3. Section 80DDB (Expenses for Medical Treatment)-
If you have incurred expenses for Medical Treatment of yourself or your dependents, You may claim a deduction of up to Rs. 40,000/- or actual amount paid in medical treatment, whichever is less. For Senior citizen, this amount is Rs. 60,000/-.
- 4. Section 80E (Interest on Education Loan)-
The interest paid on education loan for pursuing higher education of you or any dependent, is exempted from tax under this section. This deduction is applicable for a period of 8 years or till the interest is paid, which is earlier. This exemption is allowed only for full time courses, not for part time courses.
- 5. Section 80G ( Donation for Trusts)-
If you donates some amount to the trusts, charitable institutions, approved by educational institutions and qualifies for deduction under this section. There are many funds in which the donation is exempted from income tax, that are-
- National Defense Fund
- Prime Minister Drought Relief Fund
- National Children’s Fund
- National Foundation for Communal Harmony
- Prime Minister’s National Relief Fund etc.
- 6. Section 80GG (Rent For House)-
If you are salaried or employed person and staying in a rented house and does not receive any HRA then you may claim a deduction under Section 80GG of Income Tax Act.
- Section 80GGC (Monetary Contribution to Political Party)-
If you contribute any monetary amount to any political party or electoral trust then this is exempted from Income Tax.
- 8. Section 80U (Suffering from Disability)-
Any person who is suffering from any kind of specified disability then you are eligible to claim tax deduction under Section 80U of Income Tax. The diseases are-
- Low Vision
- Mental Illness
- Mental Retardation
- Hearing Impairment
- Loco-Motor Disability
The deduction provided is Rs. 50,000/- for 40% disability and Rs, 100,000/- for severe disability.
- 9. Section 80CCG (For New Investors)-
The Finance Act, 2012 introduced a new Section 80CCG to offer 50% tax Break to the New Investors who invest up to Rs. 50,000 and whose GTI is less than or equal to Rs. 10 Lakhs.