According to the Income Tax Act 1961, if a person's annual earnings exceed Rs 2.5 lakh, he will have to pay income tax on this additional income. But, if you invest in the mediums set out under the Income Tax Act, they can help reduce your tax liability. Income Department gives you income tax relief on many investment options. Let's know in which section of the Income Tax Act investment can provide you relief in income tax.
Section 80CCD(2D)
You also get the benefit of income tax exemption from section 80C on investment up to 10% of basic salary under section 80CCD (2D) in the National Pension System (NPS). Interestingly, this discount on investment can be available to taxpayers falling into all tax slabs.
Section 24B
If you have taken a loan from the bank to build a house, you get income tax relief under section 24B of the Income Tax Act on a total interest of up to Rs 2 lakh in the monthly installment paid for the same. Similarly, you also get an income tax exemption on loans up to Rs 30,000 for home repairs, etc.
Section 80U
If you are more than 40% disabled yourself, you can get an income tax discount under this section. Section 80U and Section 80DD cannot be availed simultaneously. The benefit of tax exemption is similar to section 80DD.
Under Section 80C
Tax deductions are exempted under Section 80C of the Income Tax Act on social security schemes or several investment options. This includes your contribution to EPF, PPF, Sukanya Samriddhi Yojana, NSC, Tax Saving Mutual Fund (ELSS) and Tax Saving FD, etc. You can avail of income tax exemption under Section 80C on savings made through these investment options. You are entitled to income tax exemption on a total investment of up to Rs 1.5 lakh, including premiums for life insurance, etc. At the same time, you can claim exemption from income tax under section 80C on tuition fees in the study of two children, part of the principal included in the home loan installment, stamp duty and registration charge in home purchases, etc. On investment up to Rs 50,000 in the tier-I account of National Pension System (NPS), you get the benefit of income tax exemption separately from Section 80C. Interestingly, this discount on investment can be available to taxpayers falling into all tax slabs.
Section 80E
If you want to own your spouse/spouse. If the wife has taken an education loan for the child, you can get the interest amount on it under section 80E. This amount can be to any extent and the country/country can be in the country. It can be taken for study anywhere abroad. The condition for getting an exemption is that the loan has been taken for full-time higher education and taken from a financial institution or charitable institution.
Section 80G
Donating can also reduce your liability. By donating notified by the government to several funds, you can get tax exemption on a 100% amount.
Section 80TTA
You must show the interest earned from deposits in a bank account or post office in the return item income from another source. In a financial year, if your interest is less than Rs 10,000, you can get income tax exemption under this section.
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