Income Tax Deductions: Tax payers can save up to Rs 8 lakh in income tax! Know here 10 ways

Income Tax Deductions:  The deadline for filing income tax returns for the financial year 2021-22 has been given as March 31. If you haven’t filed yet, hurry up. Here we are going to tell you today about some tax deduction methods, which you can claim on your investments, earnings and other types of payments. Remember that this tax deduction is not for the new tax system.

1. LIC premium, PF, PPF, Pension Scheme 

You get all the tax exemptions under Section 80C of Income Tax. For example, if you have taken a policy of LIC, then you can claim its premium. You can get tax exemption under 80C on the principal of provident fund, PPF, children’s tuition fee, national savings certificate, home loan. If you have purchased an annuity plan (pension plan) of LIC or any other insurance company under section 80CCC, then you can claim tax exemption. If you have bought a pension scheme of the Central Government under section 80 CCD (1), then you can claim it. Remember that taking all these together the tax exemption cannot exceed Rs 1.5 lakh.

2. Claim on Principal Amount of Home Loan

You can avail tax exemption under section 80C on the principal payment of the home loan. However, this limit cannot exceed 1.5 lakhs. So, if your remaining deductions under 80C are less than 1.5 lakhs, then you can claim tax deduction by meeting this limit from the principal amount of the home loan.

3. Tax Deduction on Home Loan Interest 

If you have taken a home loan, you get tax exemption on the interest paid under section 24(b) of Income Tax. According to Income Tax rules, you can get tax exemption on interest payment up to 2 lakhs. This tax exemption will be available only if the property is ‘self-occupied’.

4. Central Government Pension Scheme 

If you invest in the National Payment System (NPS), a central government pension scheme, then you get an additional exemption of Rs 50,000 under section 80 CCD (1B). This exemption
is on top of the tax exemption of Rs 1.5 lakh availed under section 80 (C). The contribution made by the employer to the pension scheme of the Central Government can be claimed under section 80 CCD2. It has two conditions. First, whether the employer is a Public Sector Unit (PSU), state government or any other, the deduction limit is 10 percent of the salary. If the employer is the Central Government, then the deduction limit will be 14% of the salary.

5. Health Insurance Premium

If you have taken any health insurance or get regular health checkup, then you can claim the premium under section 80D. Although its limit is fixed. If you have taken a health insurance policy for yourself, spouse, children and parents, you can claim a premium of up to Rs 25,000. In this case the age of the parents is less than 60 years. If your parents are senior citizens, then the tax exemption limit will be Rs 50,000. Health checkup of Rs 5000 is also available in this. However, the tax deduction cannot exceed the premium of health insurance.