Income Tax News: As taxpayers gear up to file their Income Tax Returns (ITRs) for the fiscal year 2023-2024 (assessment year 2024-2025), focusing on tax-saving sections can lead to significant savings. While the popular Section 80C, along with 80CCC and 80CCD(1), offers a combined maximum deduction limit of ₹1.5 lakh, several other sections provide additional opportunities for tax exemptions.
Exploring 10 Additional Tax-Saving Sections Beyond 80C
1. Section 80D: Health Insurance Premiums
Taxpayers can claim deductions up to ₹25,000 for health insurance premiums for themselves, their spouse, and dependent children. An additional ₹25,000 is deductible for parents under 60, and up to ₹1 lakh for taxpayers and parents above 60.
2. Section 80DD: Expenses on a Handicapped Dependent
A fixed deduction of ₹75,000 is available for dependents with up to 80% disability, and ₹1.25 lakh for severe disabilities.
3. Section 80E: Education Loan Interest Payment
Interest on loans for higher education is deductible without an upper limit, providing significant relief for those financing advanced studies.
4. Section 80EE: Home Loan Interest for First-Time Homeowners
Individual taxpayers can claim up to ₹50,000 for interest on home loans, in addition to the ₹2 lakh limit under Section 24 of the Income Tax Act.
5. Section 80G: Donations to Charitable Institutions
Donations to approved charitable organizations can yield deductions of 50% or 100%, including contributions to the National Defence Fund and the Prime Minister’s National Relief Fund.
6. Section 80GG: Rent Paid by Employees Without HRA
This section allows a deduction of the lower of 25% of total income, ₹5,000 per month, or rent paid exceeding 10% of total income.
7. Section 80TTA: Savings Account Interest
Interest earned on savings accounts is deductible up to ₹10,000 for accounts held in banks, post offices, or co-operative societies.
8. Section 80U: Deduction for Handicapped Taxpayers
A fixed deduction of ₹75,000 is available for taxpayers with disabilities, and ₹1.25 lakh for severe disabilities.
9. Section 80DDB: Treatment for Specified Illnesses
Taxpayers can claim up to ₹40,000 for treatment of specified illnesses, with the limit rising to ₹1 lakh for senior and super senior citizens.
10. Sections 80GGB and 80GGC: Contributions to Political Parties
Deductions are available for contributions made to political parties by companies and individuals, respectively.
Optimizing Tax Savings
By strategically utilizing these sections, taxpayers can significantly reduce their taxable income and enhance their savings. These provisions, alongside the popular Section 80C, provide a comprehensive framework for maximizing tax benefits. Taxpayers are advised to consult with financial experts to ensure they are making the most of these opportunities.
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