Income Tax News: In India, using different tax-saving tools and intelligent financial planning are necessary to save taxes on salaries over 25 lakhs. The following are some practical methods for reducing tax obligations for anyone making more than Rs. 25 lakhs:
Utilize Section 80C Deductions
Increase your investments in tax-saving products such as tax-saving Fixed Deposits (FDs), National Savings Certificates (NSC), Equity Linked Savings Schemes (ELSS), and Public Provident Fund (PPF).
Invest in NPS
To be eligible for deductions under Section 80CCD, you must make contributions to the National Pension System (NPS) (1B). Under Section 80C, further tax benefits are claimable up to ₹50,000 beyond the ₹1.5 lakh threshold.
Claim HRA and Home Loan Benefits
If you own a property, you can deduct Section 80C principal repayment and Section 24(b) interest from your taxes. In addition, if you live in rented housing and are a salaried individual, you should apply for House Rent Allowance (HRA).
Opt for Health Insurance
Purchase health insurance coverage for your family and yourself in order to take advantage of Section 80D deductions. Health insurance premiums are tax deductible, offering financial stability and lowering tax obligations.
Utilize LTA and Medical Reimbursements
Make claims for exemptions from employer-provided medical reimbursements and Leave Travel Allowance (LTA). These tax-free allowances can help lower taxable income because they are limited to certain amounts.
Plan for Retirement
Contributions to the Employee Provident Fund (EPF) and Voluntary Provident Fund (VPF) can help you develop retirement savings and take advantage of Section 80C tax benefits.
