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How to save Tax under different Sections?

If you are looking forward to some information on how to save tax under different section of the Income Tax law, you have come to the right place. Enlisted and discussed below are some of the income tax deductions list that you may find helpful:

Section 80C:

Under this section, deductions can be made in terms of different expenditures, investments and payments. The total deduction limit under the Section 80C is INR 1.5 Lacs. A few deductions that can be made to save tax as per this section include:

  • Life Insurance Premium(s) for self, spouse or child. It can also be for any member of the family in case of HUF.
  • Contribution to Employee’s Provident Fund Scheme, Recognized Provident Fund, Public Provident Fund for resident individual, Unit Linked Insurance Plan of LIC Mutual Fund and National Housing Scheme set deposit scheme/Pension fund.
  • Subscription to notified saving certificate and notified securities or deposit schemes.
  • Investment by resident individuals in Senior Citizens Savings Scheme 2005 for a 5 year period.

Section 80CCC:

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This section allows an individual to make deductions in terms of premium paid for annuity plan of LIC or some other insurer. The deduction limit under this section is INR 1 Lac.

Section 80CCD (1):

This section allows an individual to make deductions in terms of contribution to Pension Account (Assesse). The deduction limit under this section is 10% of the employee’s previous year salary or 10% of gross total income in any other case.

Section 80CCD (2):

This section allows an individual to make deductions in terms of contribution to Pension Account (by employer). The entire contribution amount, maximum 10% of the salary, is deductible.

Section 80CCG:

This section allows an individual to make deductions in terms of amount invested by resident individuals in listed units or shares under a notified scheme with a lock-in period of 3 years. An individual can avail exemption of 50% of the total investment subject to a maximum of INR 25, 000 in three consecutive assessment years.

Section 80D:

This section allows an individual to make deductions in terms of medical insurance. The exemption limit under this section is up to INR 15,000. But in case of senior citizens it is INR 20,000. Additional deduction of INR 20,000 for medical insurance of parents (in case they are senior citizens) and INR 15,000 in any other case can also be availed. Within this limit, a deduction for preventive health checkup can also be availed for up to INR 5,000.

Section 80DD:

This section allows a resident individual and HUF(Hindu undivided Families) to make deductions in terms of rehabilitation of handicapped dependent relative. The exemption limit under this section is INR 50,000 for expenses incurred on medical treatment, training and rehabilitation of that relative and payment/ deposit to a specified scheme for maintenance of that relative. A deduction of INR 1 Lac is available in case of a person with severe disability.

Section 80DDB:

This section allows a resident individual and HUF(Hindu undivided Families) to make deductions in terms of medical expenditure on self or a dependent relative. The actual amount paid or up to INR 40,000 can be exempted from tax.

Section 80E:

This section allows an individual to make deductions in terms of interest on loan for higher studies. It can be availed for the higher education of a relative as well.

Section 80EE:

This section allows an individual to make deductions in terms of interest on residential house property. The maximum exemption limit is INR 1 Lac.

Some other sections that allow an individual to save tax are: Section 80G, Section 80GG, Section 80GGA, Section 80GGC, Section 80 QQB, Section 80RRB, Section 80TTA, Section 80U and Section 24.

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