There are different ways through which you can save tax. Some of them are:

1. Tax Saving Investment Options under Section 80C:

The premiums paid on life insurance policies are eligible for deduction from taxable income under Section 80C resulting in tax saving. Some of the other tax-savings options which fall under this section are Public Provident Fund (PPF), National Savings Certificates (NSC), Sukanya Samriddhi, National Pension System (NPS) and your child’s tuition fees. However, the maximum amount which can be claimed as deduction from taxable income under this section is `1.5 lakhs.

2. By insuring your and yours loved one’s health:

Under Section 80D, premiums paid in any mode other than cash towards insuring the health of self, spouse, and dependent children are eligible for a deduction for up to `25,000 from your taxable income. Paying the premium on health policies of senior citizen parents makes you eligible for an additional deduction of `30,000 from your taxable income, thereby helping you save more tax. This limit includes the expenses of up to `5000 incurred on preventive health checkups.

3. By submitting rent receipts:

If you are staying in a rented accommodation and receive House Rent Allowance (HRA) from your employer, you can claim deduction under Section 10(13A). The least of the following three will be allowed as exemption from taxable income before calculating the tax on total income :

• Actual HRA received from the employer
• The actual rent paid is more than of 10% of salary*
• 50% of the salary if you stay in a metro city and 40% of the salary if you stay in a non-metro city

* Salary= Basic Salary+ Dearness Allowance as per employment terms

However, under Section 80GG, if you do not receive HRA from your employer or do not own a residential house, you can get a deduction of house rent expenses from your taxable income. The least of the following three will be allowed as a deduction from taxable income:

• `60,000 per annum(`5000 per month)
• Rent paid minus 10% of the total income
• 25% of total income for the year

4. By making a charitable donation:

A donation made towards certain relief funds and charitable organisations is eligible for deductions under Section 80G. However, any donation made in items such as food material, medicines, etc., are not eligible for deduction.

Mode of donations eligible for deductions under Section 80G

You can claim tax* deductions under Section 80G only if you have made a donation through a cheque, demand draft, or cash (No deductions allowed if donations exceeding ₹ 2,000 are made unless by a mode other than cash). Contributions in kind do not qualify for tax* deductions.

Who is eligible to pay?

All taxpayers - individuals, companies, or HUFs, are eligible to make charitable donations and claim tax* deductions under section 80G of the Income Tax Act, 1961

Important documents for claiming tax* deductions

Below are the documents you need to submit to claim tax* deductions under Section 80G:

• Identity proof of the donor
• PAN card of the donor
• Address proof of the donor
• Proof of the amount of donation

5. By financing higher education:

Under Section 80E, the interest paid on loan taken for higher education qualifies for a deduction from taxable income. The deduction is offered for a maximum of 8 years or till the time the interest is paid, whichever is earlier.

Who can claim this deduction?

Tax^* deduction under Section 80E can be claimed by an individual for a higher education loan taken for self, spouse, children, or a student for whom he or she is a legal guardian.

Deduction amount

There is no limit to the maximum amount that can be claimed as tax* deduction under Section 80E. However, the deduction is available for a maximum of eight years or till the interest is paid on the loan, whichever is earlier.

6. By buying a house:

Under Section 24, you can get deduction from taxable house property income, of the interest paid on home loan upto `2 lakhs. Also, first time home buyers can claim an additional deduction from taxable income of 50,000 on home loan interest under Section 80EE, provided the following criteria are met:

• The housing loan should be sanctioned in the FY 2016-17
• The loan should not be more than `35 lakhs
• The residential house value should be less than `50 lakhs
• The home buyer does not own any other residential property registered in his name on the date of sanction