Generally salaried folks will need to submit their investment proof by December finish, so that tax deducted at supply (TDS) might be adjusted – in case there are variations in proposed investments and actual investments – against the salaries of January, February and March.
While most of the personnel might have submitted their investment proof, other individuals might nonetheless do it by January finish to let the respective employers to adjust the TDS from the salaries of February and March.
To minimise the tax deduction, you really should know the provisions of tax-saving investments below different sections of the Income Tax Act.
Following are the present deduction limits that you might avail below diverse sections:
80C
The annual deduction limit u/s 80C is Rs 1.5 lakh collectively with section 80CCC and 80CCD(1). Section 80C involves deduction in respect of life insurance coverage premium, deferred annuity, contributions to provident fund, subscription to particular equity shares or debentures, and so forth, even though 80CCC includes deduction in respect of contribution to particular Pension Funds and 80CCD(1) includes deduction in respect of employee’s personal contribution to National Pension System (NPS).
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The elements u/s 80C are as follows:
- Premium payments for Life Insurance, Unit Linked Insurance Plan (ULIP)
- Payment in respect of non-commutable deferred annuity
- Deposit in Public Provident Fund (PPF)
- Investment in National Saving Certificates (NSC VIII Issue)
- Interest on NSC bought in preceding years
- Payment of Children Education Fee (Tuition Fee Only)
- Investment in Approved Debentures/ Shares/ Mutual Funds
- Investment in Fixed Deposit (FD) for 5 years or more
- Repayment of Housing Loan (only Principal Amount)
- Deposit in Sukanya Samriddhi Yojana Account
80CCD(1B)
Section 80CCD(1B) includes deduction up to Rs 50,000 in respect of voluntary contribution to Tier 1 Account of NPS. The deduction out there is more than and above the 80C limit of Rs 1.5 lakh.
80D
Section 80D includes deduction up to Rs 25,000 for folks beneath 60 years of age in respect of premium paid for overall health insurance coverage. It also includes deduction up to Rs 5,000 in respect of expenditure created on preventive overall health verify up inside the general limit of Rs 25,000.
The limit for senior citizens u/s 80D is Rs 50,000, which also involves healthcare expenditure incurred on senior citizen family members/parents. But to claim this exemption you should will need to satisfy the following situations:
a. Health insurance coverage is not taken for such a particular person (Senior Citizen)
b. Payment is created by any mode other than money
Expenditure up to Rs 5,000 is also permitted on preventive overall health checkup inside the more than limit of Rs 50,000.