1. Here’s how you can claim deductions under section 80 to avail maximum tax benefit

Here’s how you can claim deductions under section 80 to avail maximum tax benefit

There are various instruments in the market which provide you high returns with tax-saving options. But you can enjoy the benefit of maximum returns on your portfolio if you are declaring your investments under proper tax section for claiming such deductions.

By: | Updated: January 24, 2017 4:06 PM
section 80C, deduction, tax savings, tax bracket, income tax act, IT Act Sections from 80C to 80U provide you tax benefits on different kind of investments. You only need to check how much you can save with your investments.

There are various instruments in the market which provide you high returns with tax-saving options. But you can enjoy the benefit of maximum returns on your portfolio if you are declaring your investments under proper tax section for claiming such deductions. If you do not do so, you may be levied with heavy tax and, in return, your overall profit earnings will get reduced.

Sections from 80C to 80U provide you tax benefits on different kind of investments. You only need to check how much you can save with your investments.

Section 80 C

It is one of the most well-known sections which offers deductions up to Rs.1.5 lakh. The section can be used by individuals and HUF. This is designed to provide deductions on various tax-saving instruments which are ELSS under mutual fund category, insurance premiums, NPS, NSC, KVP, repayment of a home loan, etc. You can save maximum amount of Rs.45000 if you falling under 30% tax bracket (excluding cess)

Section 80 CCD(1B)

The section allows individuals to invest additional Rs.50000 per annum under section 80 C through the NPS scheme. NPS is a government scheme which is designed in a way to provide pension at the time of retirement. However, there are no fixed returns under NPS. It varies from 6% to 15%, depending upon the asset mix that is proportionate of equity and debt mix. You can save maximum amount of Rs.15000 if you falling under 30% tax bracket (excluding cess)

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Section 24

The section allows deductions of Rs.2lakh on home loan interest for a self-occupied house property. The interest is also allowed for a let out property or deemed to be let out property. You can claim the deductions once the construction of your house is complete. You can save the maximum amount of Rs.60000 (excluding cess).

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Section 80EE

The deduction is available for individuals if you are buying the home for the first time. You can get additional Rs.50000 deductions on home loan interest which are over and above the limit of section 24 under I-T Act. You can save the maximum amount of Rs.15000 (excluding cess) under this section. It means that including section 24 and 80EE deductions, you can save up to Rs.75000 (excluding cess). Until you have repaid the loan you can claim the amount. However, HUF or any other kind of taxpayer cannot claim for such deductions.

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Section 80D

This section of I-T Act gives you deductions on health insurance. The deductions are availed on the premium paid towards the health insurance policy. The eldest member of your family, whose age is below 60 – including self, spouse and dependent children, can claim up to Rs.25000. If you include parents who have attained the age of 60 and above, then, in that case, you can claim up to Rs.30000. You can save the maximum amount of Rs.7500 and Rs.9000 respectively under I-T Act. Overall maximum tax saving can go up to Rs.16500 (excluding cess) in such case.

Section 80TTA

This section is designed to allow deductions of interest income on savings bank account. The deduction is not available on interest income from FD or RD. Maximum deductions of Rs.10000 or less can be claimed under this section. To claim such deductions, you need to add all your interest earning in your gross income while calculating tax and then claim the deductions under 80TTA. You can save maximum amount of Rs.3000 if you are falling under 30% tax bracket (excluding cess).

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