How To Save Tax Other Than 80C?

As a taxpayer, you need to be aware of tax savings schemes other than Section 80C if your objective is to save tax and positively impact your financial life. You should not plan your life for the sake of saving taxes but take advantage of tax-saving options according to your life decisions. Therefore, use all the available tax-saving opportunities and reduce the burden of your taxes.

Let’s discuss some of the ways how you can save tax other than availing the deductions and exemptions under 80C of the Income Tax Act, 1961. 

Tax Saving Options Other Than 80C

Section 80C is one of the most well-known tax-saving sections in the Income Tax Act that allows huge deductions. However, you also need to be aware of the alternative sections available to lower your tax liabilities. Here are some important tax sections that offer you deductions and exemptions: 

1. Section 80CCD

You can save up to Rs.50,000 by investing in the National Pension Scheme. Whether you are an employee, employer or contribute voluntarily, you are eligible for deduction if you contribute to this scheme. Under Section 80C, you will be able to claim up to Rs.1,50,000 for your contribution; an additional deduction of Rs. 50,000 under Section 80CCD makes it a total of Rs.2,00,000.

2. Section 80D

To encourage people to opt for health insurance, the government offers tax incentives on health insurance premiums. In case you have opted for a Mediclaim policy for yourself and your dependent children and spouse, you can claim a deduction of Rs.25,000 under this section.

In case you opt for insurance for yourself and your parents, you can claim a maximum deduction of Rs.50,000. If your parents are above 60 years and you are below 60, you can claim up to Rs.75,000, and in case you are above 60, then the amount will shoot up to Rs.1,00,000.

3. Section 80DD

In case you have a dependent family member who is handicapped, you can avail tax deduction of up to Rs.75,000 in case of 40% to 80% disability. However, in case of disability above 80%, you can claim up to Rs.1,25,000. This will help in managing medical expenses as well as rehabilitation and taking better care of them. 

4. Section 80E

You can claim deductions in case you take an educational loan for higher education for yourself or your spouse or children. However, this is applicable for only the interest amount paid for the loan, and that too for the first eight years of loan repayment. After eight years, you will have to pay taxes on interest repayment.

5. Section 80EE

Buying your own home is a dream that every individual wants to fulfil. According to section 80EE, you can get a deduction of Rs.50,000 if you are a first-time homebuyer. To get a tax rebate on EMI payments under this section, you should not own more than one property. This advantage comes along with the benefits of section 24, which will be described below.

6. Section 80G

Under section 80G, you can save tax by contributing to any registered charitable organisation. In case you donate cash, you get an exemption of Rs.2,000 every year; however, in case of bank transfer, there is no specific limit on tax waived. 

7. Section 80GG

In case you do not receive any house rent allowance from your employer, as per section 80GG, you can claim an exemption from your taxable income. It can be either Rs.5,000 monthly or 10% of basic annual income or 25% of total annual income, whichever is least. 

8. Section 80TTA

You can also claim a deduction by keeping your extra funds in the bank. According to section 80TTA, you can claim up to Rs. 10,000 deductions for interest earned from a savings account. 

However, in case you are above the age of 60, you can opt for section 80TTB, which will allow you to claim a deduction of Rs. 50,000, and it will be applicable not only for savings accounts but fixed deposits as well.

9. Section 10(10D)

As per this section, you can claim a tax rebate when you receive the entire amount of a life insurance policy after maturity or due to the insured's untimely death. This is, however, applicable in case the policy was taken after 2012. If not, the premium expense should be less than 20% of the total sum insured for section 10(10D) benefits.

10. Section 24

If you take a home loan, you can claim a tax deduction for the interest component. If the loan is availed for a self-occupied property, you can claim up to Rs. 2,00,000. If the property is rented or not self-occupied, there is no upper limit set for the deduction that you can claim on repayment of interest. 

Final Word

The list of ways to save tax other than 80C does not end here. There are multiple types of investments that you can make to improve your overall financial standing and pay fewer taxes. Now that you know the different ways to save taxes, it is time to make the right decisions and choose the best tax-saving options for you and your family.

Frequently Asked Questions

Is there any deduction on donations to political parties?

According to section 80GGC, you can claim a deduction of the full amount you donate to any political party or electoral trust if you do not pay it in cash.

What deductions are applicable under section 80EEB?

Under Section 80EEB of the Income Tax Act, you can claim a deduction of up to Rs.1,50,000 on interest payment on a loan taken for purchasing an electric vehicle.

Does tax deduction under section 80D include premiums paid for critical illness insurance plans?

Yes, under section 80D, you can avail deduction for premium payment towards a critical illness insurance plan. If you are below 60, the tax deduction limit is Rs. 25,000 annually for yourself, your spouse and your children. If you are above 60, the limit can be extended to a maximum of Rs. 50,000. 

What is a gift tax?

Any type of monetary gift that you receive contributes towards your income for that financial year and is taxable. However, if you cash as a gift from your direct relatives, it is tax-free. Any gift worth more than Rs. 50,000 from non-relatives would be taxable. 

Is relocation allowance different from house rent allowance?

In case you need to relocate due to your job requirements and the company reimburses it, it is referred to as relocation cost. On the other hand, house rent allowance (HRA) is part of employers' salary for dealing with expenses towards rented accommodation.

Also Read About:
How To Save Tax For Salary Above 7 Lakhs?
How To Save Tax For Salary Above 12 Lakhs?
How To Save Tax For Salary Above 10 Lakhs?
How To Save Tax For Salary Above 15 Lakhs?
How To Save Tax For Salary Above 20 Lakhs?
How To Save Tax For Salary Above 30 Lakhs?
How To Save Tax For Salary Above 50 Lakhs?