Everyone wants to get the relaxation in their income tax. It is very easily to claim a deduction in your income tax by some easiest way. Here we are describing some simple tax saving investments ways through which you can save your income tax amount.
Tax saving schemes:
1. Tax Saving through Home Loan:
If you are paying interest on your home loan then you can get relief in income tax. In 2016 budget, the deduction amount for home loan interest is increased from 2 lakhs to 2.5 lakhs. This relaxation can give you a huge tax saving. However, you can enjoy this benefit only when your amount of home loan is high. You can also increase your tax saving through the joint home loan.
2. Save Tax through Education Loan:
If you are a taxpayer and taken an education loan for himself or for your wife and your children then you can claim a deduction in your tax under the Section 80E. The tax subtraction is only possible for the repayment of interest. There is no relaxation in the tax for the repayment of principal amount of education loan. The Government of India has not decided any limit for claiming a deduction in income tax under the section 80E. Only taxpayers can take the advantage of the scheme.
3. Save Tax through Donations:
This is an another way for a taxpayer through which they can save their income tax. If you are doing charity and makes a donation for solicitous purpose and giving your contribution to National Relief Fund, then this donation can be fall under the Income Tax Act. Finance Ministry has already specified the name of organizations in which the taxpayer can claim a tax deduction on the basis of their donation. The amount of tax deduction depends on the purpose for which the donation has been made.
In some cases, 100% of the donation or charity made by a taxpayer is allowed to be claimed as a deduction in the tax. Whereas in some cases only 50% of the charity made is permitted to be affirmed as a deduction for the purpose of tax saving. The donation made through cheque or cash are only considered to be deducted.
4. Save Tax through PPF:
Public Provident Find is also eligible for tax deductions under Section 80C which was launched in 1961. Previously the deduction limit for PPF depositors was Rs.1 lakh which has been increased to Rs.1.5 lakhs in 2015. Any depositor of PPF can claim the deduction of Rs.1.5 lakhs.
PPF accounts also offer many other benefits in tax such as the interests of PPF amount is tax-free and wealth tax is also not applicable of PPF. Therefore, PPF is a very beneficial scheme which offers you multiple privileges of tax benefits.
5. Save Tax through Leave Travel Allowances and Medical Expense:
You can also get tax relaxation by showing your medical expense and travel expense. Yes, this is absolutely true, now personal expenses are also eligible for tax exemptions. With the help of your companies HR department, you can deduct these expenses from your gross salary. If you are able to show your medical bills then this amount will become tax-free but its limit is only Rs 15,000 in a financial year. That means if your medical bill is more than Rs 15,000, then you have to pay tax on your medical expenses.