Most Indian investors are well-versed with the tax-saving investments and deduction under Section 80C of up to Rs 1.5 lac per annum by investing in these Section 80C investments. Some examples of Section 80C investments include public provident fund (PPF), tax-saving ELSS funds, sukanya samridhi yojana (SSY), senior citizens savings scheme (SCSS), national pension schemes (NPS), national savings certificate (NSC), tax-saving FDs (fixed deposit), etc. However, most investors are not aware of all the other key deductions that can help them attain maximum income tax savings on their investments. If you are one such investor who is unaware of all the tax-saving deductions, do not fret. You have come to the right place. In this article, we will understand other deductions other than Section 80C that can help you save tax.
Apart from the total limit of Rs 1.5 lac offered by Section 80C, there are other tax-saving opportunities offered to investors on top of this deduction or in conjunction with Section 80C of the Income Tax Act, 1961. Let’s understand a few of these deductions that can help you decrease your taxable income:
- Pension contribution – Section 80CCD of the Income Tax Act, 1961 allows individuals to get an additional tax deduction of Rs 50,000 per month against NPS accounts on top of the Section 80C tax deduction of Rs 1.5 lac p.a.
- Rajiv Gandhi Equity Saving Scheme (RGESS) – Section 80CCF of the Income Tax Act, 1961 allows first-time investors in domestic equity markets of India to avail of a 50% tax deduction of their investment amount up to Rs 50,000 per annum.
- Medical insurance deductions – Section 80D of the IT Act allows an individual or a HUF (Hindu Undivided Family) for expenses made against the premiums of medical insurance for the individual, or their spouse, or dependent children, or dependent parents. An individual or an HUF is further eligible for other health-related expenses such as medical expenditure and preventive medical check-ups for a senior citizen or a super senior citizen who is not covered under any health insurance plan.
- Dependent with disability – If you are an individual who has a dependent with a disability of 40% or more, you can claim a tax deduction irrespective of your actual income tax u/s 80DD of the Income Tax Act, 1961. You are eligible for a tax deduction of Rs 75,000 given that the disability is equal to or more than 40%, but less than 80%. If the disability is more than or equal to 80%, you are eligible for a tax deduction of Rs 1.25 lacs.
- Medical treatment of an individual suffering from a specific disease
If you have a dependent suffering from a specific disease as mentioned, you will be eligible for claiming a tax deduction against the costs borne towards the treatment. If the dependent is a senior citizen, the deduction would be Rs 1 lac or the cost of the treatment, whichever is lower. However, if the dependent is not a senior citizen, the deduction would be Rs 40,000 or the cost of the treatment, whichever is lower.