The moment you type in “tax saving options” into Google’s search bar, you will be bombarded with all the various investment option you have under Section 80C. You’ll see results that suggest putting your money in ELSS or FDs or PPFs.
Every one of these suggestions is definitely the logical way to go. However, with these tax saving options, you have an upper limit of Rs 1,50,000 that you can deduct from your taxable income. So what other ways do you have at your disposal to reduce your taxes?
Here are a few surprising alternatives you can take advantage of:
Section 80G: We are all instilled with the habit of helping the less fortunate. Every year most of us donate in cash or kind to NGOs, charitable trust, religious organisations, etc.
However, did you know these donations could be treated as deductibles from your taxable salary? Under Section 80G, there are many donations on which you can get a deduction up to 100% or 50% with or without restriction. You can find the list of funds with a simple search on the internet.
Please note, any donation above Rs 2000 should be made in modes other than cash to qualify as deduction u/s 80G.
Section 80E: We spend a considerable part of our formative years in earning that much-needed graduation certificate. Our dreams and aspirations don’t come cheap, we end up taking educational loans. Here is the silver lining, any interest paid towards clearing education loan is deductible under Section 80E.
Section 80TTB: In the Budget 2018 the finance ministry introduced the Section 80TTB. This section essentially allows the deduction of any interest earned on deposits held by senior citizens.
An individual can deduct up to Rs 50,000 under Section 80TTB. If these deductions are availed then the individual is not eligible to avail any further deduction under Section 80TTA.
Section 80EE: A dream home is part of everybody’s to-do list. Interestingly now you can get a tax deduction for actually doing so. To be precise, one can claim a deduction of an additional Rs.50,000 (over section 80C & Section 24) of interest paid towards a home loan.
The baseline requirements are that the loan must not be for more than Rs 35,00,000 and the value of the property must not be more than Rs 50,00,000. Furthermore, the individual must not have any other property registered under his name at the time the loan is sanctioned.
There are many such tax saving easter eggs that the Government has left for you to find. They are left there to be taken advantage of, so don’t shy away from the golden goose.