The current financial year is nearing its end and tax payers are busy exploring tax-saving options to reduce their tax outgo. Section 80C is the go-to avenue for availing tax deduction for most tax payers. However, if you have exhausted the Rs 1.5-lakh limit under Section 80(C), here are some tax-saving options you could opt for.
Health insurance under Section 80(D)
Given the increasing healthcare cost, health insurance in the financial portfolio is a must-have. Additionally, it can save you tax under Section 80(D). And not just on premium paid for self, but also for spouse, dependent children and parents.
You can claim a maximum deduction of Rs 25,000 on the premium paid for self, dependent children, spouse. You can claim an additional Rs 25,000 for health insurance for dependent parents under the age of 60 years.
For senior citizen parents, you can claim a maximum deduction of up to Rs 50,000.
However, one thing to be noted here is that the premium needs to be paid in a mode other than cash.
Medical expense incurred for dependents with disability under Sec 80(DD)
Under Section 80 (DD), an individual can claim tax deduction against the expenditure incurred for medical treatment of a dependent person with disability.
A fixed deduction of Rs 75,000 is available for this purpose. You can avail deduction to the extent of Rs 1,25,000 for the ones with severe disability (Deductions available are subject to applicable conditions).
Interest payment on education loan under Sec 80(E)
Interest payment on education loan taken for self, spouse and children is eligible for deduction under Section 80 (E). Deduction for the interest paid needs to be claimed in the relevant financial year. Further, this deduction can be availed for eight years from the time you start repayment.
Donations eligible under Section 80(G)
Donations made to certain funds, charitable institutions, etc. or any other government notified funds are eligible for tax deduction under Section 80 (G).
However, the amount donated should not exceed 10% of the adjusted gross total income. Also, donations made in cash are eligible for tax benefits, only if they are less than Rs 2000.
Payment of rent under Section 80 (GG)
Usually you can claim deduction for HRA through the HRA form received from the employer. However, if you don't receive HRA from your employer, you can claim for deduction for the payment you make toward rent under Sec 80 (GG). Declaration needs to be submitted in Form 10BA to avail the deduction.
Another condition for claiming deduction is that you, your spouse, minor child or HUF of which you are a member do not own a residential house in the place where the rented accommodation is located.
Interest on deposits in savings account under Sec 80 (TTA)
Interest earned on savings account deposit is admissible as a deduction under this Section.
Interest received on the savings account should be added under the head ?Income from other sources?, which makes it eligible for deduction under Section 80 (TTA). The ceiling for deduction under this Section is Rs.10,000.
Interest on deposits in savings account by senior citizens under Sec 80 (TTB)
Interest received by senior citizens on deposits in bank savings account, post offices, term deposits and recurring account deposits is eligible for deduction under Section 80 (TTB). The maximum limit here is Rs 50,000.