All taxpayers of the country have to pay taxes on time. In such a situation, he can also avail the benefit of tax deduction. Tax deductions can be availed by using various sections in the Income Tax Act. Let us know in this article how much tax deduction benefit is available in which section. Read the full news…
New Delhi. Whenever it comes to tax saving, people often apply for tax deduction under section 80C and 80D. Let us tell you that you can deduct tax up to Rs 1.50 lakh under 80C. At the same time, under Section 80D, you can get the benefit of tax deduction on medical expenses. Apart from this, there are many sections through which you can easily avail tax deduction.
Come, let us know in which investments you can avail tax deduction.
Provident fund
Whatever investment an employee makes in the Employee Provident Fund is tax-free. Only the employee gets the benefit of this tax deduction. The employer does not get the benefit of any tax deduction under section 80C. There is no tax on the interest along with the amount invested in PPF. PPF contribution is eligible for tax deduction under Section 80C of the Income Tax Act, 1961.
Life insurance
No tax is levied on the premium paid in life insurance. The taxpayer can claim tax deduction on this premium under Section 80C. Under Section 80D of the Income Tax Act, no tax is levied on medical premiums up to Rs 25,000 per year. At the same time, tax deduction can be availed on expenditure up to Rs 5,000 on health checkup.
Equity Linked Saving Scheme
Tax deduction can also be availed on the amount invested in equity linked savings scheme. Equity linked savings scheme is included in mutual funds. In this, tax deduction up to Rs 1.50 lakh can be claimed. In this scheme, the income and profits earned are included in long term capital gains. If it exceeds Rs 1 lakh, then up to 10 percent tax is paid on it.
Home loan
You can also claim tax deduction on the principal amount paid in home loan. Loan holders can claim tax deduction under section 80EE of the Income Tax Act. A deduction of up to Rs 50,000 can be claimed in a financial year.
Infrastructure bonds
The amount invested in infrastructure bonds is also covered under Section 80C of the Income Tax Act. The investment amount in this bond should be Rs 2,000 or more. The government provides tax deduction under Section 80C on investment fees.
