The people must also pay more taxes to the government as their income rises. People are required to report their income and file ITR each year. Taxes must also be paid on people’s taxable income in addition to this. The majority of individuals wish to reduce their tax burden a little. In light of this circumstance, we will explain below how you can save money on taxes under the previous tax system when you file your income tax return the following year. Let’s discuss it.
Savings on Taxes Under Section 80C
Section 80C of the Income Tax Act allows for income tax exemption if income tax returns are filed under the previous tax system. People can invest in specific programs under this provision and save tax.
ITR – Article 80D
You may deduct up to Rs 25,000 from your taxable income for premium payments made using any method other than cash to protect your own health and the health of your spouse and dependant children. You can deduct an additional Rs 30,000 from your taxable income when you pay the payments for your elderly parents’ health insurance, which would enable you to spend less tax overall. This cap includes up to Rs. 5000 in preventive health checkup costs.
You can claim a deduction under section 10(13A) by providing your rent receipts if you rent your home and receive a House Rent Allowance (HRA) from your employer. Before calculating the tax on the entire income, the least of the following three shall be permitted as an exemption from taxable income.
ITR – Donations
Section 80G allows donors to deduct contributions they make to specific charities and humanitarian funds. However, donations made in the form of tangible goods like food, medicine, etc. are not tax deductible. Only donations given by cheque, demand payment, or cash are eligible for a tax deduction under Section 80G (donations made by any other means or for an amount greater than Rs. 2,000 are not eligible for a deduction). Additionally, a contribution in kind is not deductible for tax purposes.
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