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How Salaried and Non Salaried Person Can Save Tax

How Salaried and Non Salaried Person Can Save Tax

There are number of deduction available for salaried person to save income tax. Although you have to do a proper tax planning from the beginning of the financial year to avoid last minute investment. These deductions are as follows:-

  1. Investment u/s 80C, 80CCC and 80 CCD(1)

Limit – The maximum limit of deduction is Rs 1,50,000 (Rs 1,00,000 before FY 2014-15).

Payment – This deduction is allowed whether the payment is made from income chargeable to tax or not.

Qualifying Investments

  1. Life Insurance Premium (LIC)
  2. Superannuation Fund or Recognized Provident Fund
  3. Public Provident Fund (PPF)
  4. Nations Saving Certificate (NSC VIII Issue)
  5. Unit Linked Insurance Plan (ULIP)
  6. Notified units of Mutual Fund or UTI
  7. Pension Funds
  8. Education Expenses on Children
  9. Home Loan Principal Repayment
  10. Stamp Duty and Registration Charges for purchased home
  11. 5 Year Tax Saving Fixed Deposit in Banks
  12. Sukanya Samriddhi Account
  13. 5 Year Post Office Time Deposit (POTD)
  14. Equity Linked Saving Scheme (ELSS)
  15. NABARD Rural Bond
  1. Medical Policy u/s 80D

Limit – The total limit of deduction is Rs 60,000 subject to various threshold limit.

Payment – This deduction is allowed only when the payment is made from income chargeable to tax.

  1. Interest repayment of Education Loan u/s 80E

Limit – 100% of the amount paid as interest.

Payment – This deduction is allowed only when the payment is made from income chargeable to tax.

  1. Donation u/s 80G

Limit – 50% or 100% of the amount paid as donation subject to various threshold limit.

Payment – This deduction is allowed whether the payment is made from income chargeable to tax or not.

  1. Deduction u/s 80GG for the rent paid

Limit – The maximum limit of deduction is Rs 24,000 for the complete year subject to various threshold limit. It is only allowed if HRA is not received any time during the previous year.

Payment – This deduction is allowed whether the payment is made from income chargeable to tax or not.

  1. Infrastructure Bond u/s 80CCF

Limit – The maximum limit of deduction is Rs 20,000.

Payment – This deduction is allowed whether the payment is made from income chargeable to tax or not.

  1. Loss from house property

The Loss from house property can be adjusted from Salary Income. So, if you have a house property and there is a loss from house property (interest or otherwise) then you can adjust the same with the Salary Income. Interest paid on self occupied property is allowed upto rs. 1,50,000.

About Prateek Agarwal

I am Chartered Accountant by profession, practicing in Jaipur. I have interest in accounting and taxation field.

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