Income Tax News: Family Finances Sorted! How Parents, Children and Spouse Can Revolutionise Your Tax Savings

Income Tax News: People want to use a variety of tools when it comes to tax savings. Make all kinds of investments. There are other kinds of costs that are incurred. But did you know that you can also save income tax by working with your family? Yes, you can save a lot of money on taxes by working closely with your parents, spouse, and kids. Let us tell you how your family can reduce their tax liability.

Claiming HRA through Parents' Rent

There are three ways for parents to save taxes. Tell us what needs to be done for you to receive this benefit.

You can claim HRA by paying your parents' rent if you live with them and aren't eligible to receive HRA. If you're thinking that this is incorrect, you're not. By proving your parents are tenants, you can claim a tax deduction on HRA under Section 80GG of the Income Tax Act. You can demonstrate under this that you pay your parents' house rent. You cannot, however, claim HRA if you are receiving any other housing benefit.

Additional Benefits for Senior Citizens

Senior citizens receive additional benefits in the majority of tax-saving programmes. You can make investments in tax-saving plans under your parents' name if they fall into the senior citizen category. This will benefit you in two ways. First off, you'll receive tax benefits. Seniors will receive higher interest rates as well. Seniors are exempt from paying taxes on interest income up to a yearly total of Rs 50,000.

Health Insurance for Parents

You can take care of your parents' health and save money on taxes at the same time. You are exempt from paying taxes on the premium amount if you enrol your parents in health insurance. You will receive a tax exemption on the first Rs 25,000 of premiums paid for your parents' health insurance if they are under 65. You will receive the benefit of tax exemption up to Rs 50,000 if you are over 65.

Introduction to Spousal Tax Savings

Tax savings can also be aided by your spouse, or life partner, if you are a woman and your husband is a man. Three ways exist for husband and wife to assist one another in tax savings.

Maximizing Tax Benefits with Joint Home Loan

If you're considering purchasing a home, do so by obtaining a joint mortgage and having it registered in your names. Both of you are eligible to receive tax benefits on your home loan in this scenario. This way, the tax benefit will be doubled for you. You can each claim Rs 1.5 lakh on the principal, for a total of Rs 3 lakh under 80C. However, under Section 24, both can receive a tax benefit on interest of up to Rs 2 lakh. This implies that you may receive a total tax benefit of up to Rs 7 lakh. It will, however, also be influenced by the total amount of your house loan.

Tax-Efficient Stock Market Investments Through Spouse

Up to Rs 1 lakh in capital gains are exempt from taxation if you make long-term investments in the stock market. If your wife is a homemaker and her income is very low in this case, you can give her some money to invest in the stock market under her name. In this way, your wife will receive tax exemption on capital gains up to Rs 1 lakh on the returns you receive on that money. In contrast, your total gain would be Rs. 2 lakh if you had invested this money yourself and had already realised a capital gain of Rs. 1 lakh. You would be required to pay tax on Rs 1 lakh in this scenario.

Tax Benefits for Education Loans

Many girls feel pressured by their families to get married, but then decide they need to finish their education. In this case, you will be exempt from paying taxes on the interest paid on any education loans you take out for your wife while she is enrolled in classes. For eight years, the interest on your education loans is exempt from taxes. This exemption is granted to you by section 80E. However, bear in mind that you should only obtain a student loan from a bank or other establishment that has government recognition.

Health Insurance Premium Deductions

If you'd like, you can enrol in a family floater insurance plan or obtain your wife's health insurance on her own. You can deduct up to Rs 25,000 in taxes from your health insurance premiums under Section 80D for you, your spouse, and your dependent children.

Education Expenses Deduction

Children, as well as parents or spouses, can contribute significantly to tax savings. Tell us how kids can avoid paying taxes.

Tuition Fee Deduction under Section 80C

Under Section 80C, you can deduct up to Rs 1.5 lakh from your children's tuition if they are enrolled in school or college. Tax exemption is only available on tuition; it is not available on the full cost of attending the school or college. You may also benefit from this exemption for a maximum of two kids.

Tax Exemption on Health Insurance Premiums for Children

The child will be covered by the family floater plan that you and your spouse choose. Section D offers a tax exemption on premiums up to a maximum of Rs 25,000 for all of these.

Tax-Efficient Investments in Children's Names

You have the option to invest in children's names as well. PPF, Sukanya Samriddhi Account, Mutual Funds Account, and Traditional Insurance Policy can all be of assistance with this. You are eligible for a section 80C deduction for the investment you make in this.

Tax Benefits for Education Loans - Section 80E

In the same way that you can deduct taxes under section 80E if you take out a loan for your wife's education. In a similar vein, if you take out an education loan to pay for your child's education, you can save tax under Section 80E. This loan may be taken out for you, your spouse, your child, or a student over whom you have legal guardianship.

Keep watching our YouTube Channel ‘DNP INDIA’. Also, please subscribe and follow us on FACEBOOK, INSTAGRAM, and TWITTER