Enjoy income tax rebate following these simple steps - Details here

As the financial year 2023-24 approaches its end, individuals are rushing to file investment proofs and explore avenues for income tax savings. Good news for those with a salary up to Rs.8 lakh you can potentially save good amount of  tax. 

Here are 10 effective ways to optimize your income tax savings.

1. Investment in LIC, EPF, PPF, and Pension Schemes (Section 80C):

• Claim tax exemption on LIC premium, EPF, PPF, children's tuition fees, NSC, and home loan principal under Section 80C.
• Annuity plans (pension plans) under Section 80CCC and Central Government pension scheme investments under Section 80CCD (1) also offer tax benefits.
• Combined exemption limit cannot exceed Rs 1.5 lakh.

2. Save Tax with Home Loan (Section 80C):

• Avail tax exemption on home loan principal under Section 80C, capped at Rs 1.5 lakh.
• Ensure total deductions under Section 80C do not exceed Rs 1.5 lakh.

3. Home Loan Interest (Section 24(b)):

• Tax exemption on home loan interest up to Rs 2 lakh under Section 24(b), applicable if the property is 'self-occupied.'

4. Invest in NPS (Section 80CCD):

• Additional exemption of Rs 50,000 under Section 80CCD (1B) for investments in NPS.
• Employer's contribution claimable under Section 80CCD2 with specified conditions.

5. Health Insurance Premium (Section 80D):

• Claim premium under Section 80D for health insurance policies covering self, partner, children, and parents.
• Exemption limit of Rs 25,000 (Rs 50,000 for senior citizens) with an additional Rs 5,000 for health checkups.

6. Expenses for Treatment of Disabled Dependents:

• Claim up to Rs 75,000 annually for treatment or maintenance of disabled dependents.
• If disability exceeds 80%, a deduction of Rs 1.25 lakh can be claimed on medical expenses.

7. Tax Exemption on Payment for Medical Treatment (Section 80DD 1B):

• Deduction of up to Rs 40,000 for the treatment of specific illnesses; Rs 1 lakh if the individual is a senior citizen.

8. Tax Exemption on Education Loan Interest:

• Unlimited benefit on interest paid for education loans for a maximum of 8 years.
• Available for two children together.

9. Rebate on Loan for Electric Vehicles (Section 80EEB):

• Tax exemption up to Rs 1.5 lakh on interest payment for loans taken to buy electric vehicles.

10. House Rent Payment (Section 80GG):

• If HRA is not part of your salary, claim house rent payment under Section 80GG.

Maximize your income tax savings using these 10 strategies. However, it is crucial to consult your financial adviser for personalized advice based on your financial situation and goals.

Consult your financial adviser for more details and personalized advice before making any financial decisions.