Income Tax News: Section 80C of the Income Tax Act is one of the most popular tax-saving solutions for salaried individuals. It permits you to deduct Rs 1,50,000 or Rs 1.50 lakh from your taxable income. However, there are more options available that provide appealing deductions, hence lowering taxable income. Let’s take a short look at six alternatives to Section 80C.
National Pension System
Section 80CCD(1B) allows for an additional deduction of up to Rs 50,000 for National Pension System (NPS) contributions. NPS is a government-backed system that allows people to invest money and get rewards after they retire.
Health Insurance Premium
Section 80D allows a person to claim a deduction for health insurance premiums paid for themselves, spouse, parents, and dependent children. The deduction exemption limit for self and family (under 60 years) is Rs 25,000. Deduction of up to Rs 50,000 is permitted for parents or self/spouse (over the age of 60).
Home Loan Interest
A first-time purchaser can claim a deduction for home loan interest payments under Section 80EE. Rs 50,000 is the exemption limit.
Education Loan Interest
Individuals can claim a deduction for student loan interest paid under Section 80E. This deduction, however, is only permitted for a maximum of eight years or until the interest is repaid, whichever comes first.
Savings Account Interest
Individuals can claim a deduction of up to Rs 10,000 on total savings account interest income obtained under Section 80TTA.
Rent Paid
Section 80GG allows an individual to claim a deduction for rent paid. This option is offered to employees who do not have HRA. The maximum deduction under Section 80GG is Rs 60,000 per year, or Rs 5000 per month.
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