There are a bunch of tax saving options under Section 80C of the Income Tax which allows income tax deduction and reduces the overall income tax liability. Tax saving instruments such as ELSS, PPF, tax saver fixed deposits, national savings certificate, senior citizen savings scheme, etc. provides tax breaks under the Section 80C. According to the prescribed guidelines by the Income Tax Department, an individual is allowed to claim deductions of up to Rs 1.5 lakh under Section 80C of the Income Tax Act.
There are certain other sections which allow claiming deduction beyond the ceiling of Rs 1.5 lakh under Section 80C. Some of the other options include the payment of medical insurance premium, rent of accommodation, interest paid on educational loan and donations to charitable organisations.
4 tax saving schemes other than Section 80C for FY 2019-20
Section 80D: Payment of insurance premiums
The premiums paid for medical insurance for yourself and on the behalf of your family members are eligible for a tax break under Section 80D of the Income Tax Act. A person can avail a maximum deduction of Rs 25,000 in a particular fiscal year on the premium paid for self, spouse and children and an additional Rs 25,000 for the premium paid for parents. The deduction can go up to Rs 50,000 in case the taxpayer is a senior citizen.
Section 80GG: Rent paid for accommodation
A person staying in rented accommodation is eligible to claim tax break under Section 80GG of the Income Tax Act. This tax deduction is limited to individuals who are not receiving House Rent Allowance (HRA) from the employers. A maximum of deduction under this section can go up to the 25 per cent of the total income or rent paid over 10 per cent of total earnings or Rs 5,000 per month.
Section 80E: Interest paid on education loans
The interest paid on education loan availed for self, spouse, children, or on the behalf of a student as a legal guardian is eligible for tax deduction under Section 80E of the Income Tax Act. According to the present guidelines, there is no upper ceiling on amount eligible for the tax deduction, provided the loan is taken for higher education.
Section 80G: Donations to charitable organisations
The donations made to charitable organisations are also eligible for a tax break under Section 80G of the Income Tax Act. All the individuals are allowed to claim a tax deduction on donations made to charitable organisations irrespective of the income source by providing a stamped receipt.
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