Income Tax saving tips: To save income tax, people often adopt the same old ways – like investing under section 80C, claiming home loan interest or buying health insurance. But there are some tricks, by which you can save a lot of tax (How to save tax). Today we are going to tell you 5 easy and unique ways, by which you can save a lot of tax (Income Tax Savings). Very few people know these methods.
You can also get tax exemption on pre-nursery fees!
If your child studies in playgroup, pre-nursery or nursery, then you can also get tax exemption on its fees. This exemption comes under section 80C of the Income Tax Act. This tax benefit was implemented in 2015 itself, but it did not become as popular as the school tuition fee deduction. You can claim tax exemption on the fees of maximum two children.
Pay interest to parents and get tax exemption
If your parents fall in a lower tax bracket or are not taxed, you can take a loan from them for household expenses and get tax exemption by paying interest on it. By taking proof of interest payment (attested certificate), you can claim a maximum exemption of Rs 2 lakh under section 24B.
Pay rent to parents and save tax on HRA
If you live with your parents and are not able to avail HRA, then this method is useful for you. Pay house rent to your parents and claim HRA under section 10(13A) by showing them as tenants. This is completely legal. But keep in mind that if you are taking any other housing benefit, then you will not be able to claim HRA.
Save tax on family health insurance
You can also get tax exemption while taking care of your family’s health. Under section 80D, there is a deduction of up to Rs 25,000 on the health insurance premium of parents (below 65 years of age). Up to Rs 50,000 is exempted for parents (above 65 years of age). Exemption is also available on the insurance premium of wife and children.
Tax exemption on medical expenses
If your parents are 60 years or older, you can claim tax exemption on their medical expenses. Maximum exemption of Rs 50,000 under Section 80D. Medical expenses of senior citizens are often huge. This tax exemption helps in handling these expenses.
So what should one do?
You can easily reduce your tax liability by adopting these less used methods. Be it pre-nursery fees, interest paid to parents or health insurance – do not forget to take advantage of these methods.
Disclaimer: This information is given for general tax saving purposes. Please consult your financial advisor before taking any investment and tax related decisions.
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