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The last date for filing ITR for the financial year 2023-2024 is 31st July 2024. From salaried to businessmen, everyone is planning for it. According to the income tax slab, if you have chosen the old tax system, then you will have to pay 5% There is no tax on income up to Rs 1 lakh, while if you have chosen the new tax system, then there is no tax on income up to Rs 7 lakh. In such a situation, whether a salaried person or a businessman, everyone is trying to save income tax by trying their own methods.
Talking about working people, tax saving has always been a challenge for them. They have to plan their monthly expenses as well as savings, investments and retirement. In such a situation, understanding your needs, here we are going to tell the ways for working people through which you can easily save your income tax.
home loan
If you have taken a home loan, you can get tax exemption on its principal amount under 80C. Apart from this, you can also get exemption on home loan interest. You can get this exemption under section 24 (B) of Income Tax. According to the Income Tax rules, tax exemption can be claimed on interest up to Rs 2 lakh. However, this tax exemption will be available only if the property is 'self-occupied'.
EPF
One of the easiest tax saving options for salaried people is the Employee Provident Fund (EPF). It offers tax exemption of up to Rs 1.5 lakh under Section 80C of the Income Tax Act. Interest up to Rs 2.5 lakh received annually in the PF account is tax free.
HRA
House Rent Allowance. HRA is an allowance given to employees to pay their house rent. Your company pays HRA along with your salary. Tax exemption on HRA can be availed within certain limits under section 10(13A) of the Income Tax Act.
1. Tax exemption on total income in the form of HRA.
2. Up to 50% of the basic pay for a person living in a metro city, Up to 40% of the basic pay for people living in smaller towns.
3. On paying house rent of 10% of total annual income.
After calculating these three factors, the lowest amount that comes out can be used for tax exemption from HRA. Apart from this, tax on income in the form of HRA can be saved only by those salaried people whose salary includes HRA and who live in a rented house. To get this exemption, you will have to provide the rental agreement or house rent receipt.
Health Insurance Policy
Under Section 80D of the Income Tax Act, if the taxpayer pays the premium of health insurance, he gets tax exemption. If you have taken a health insurance policy for yourself, spouse, children and parents, then you can claim tax on premium up to Rs 25,000. In this case, the age of the parents should be less than 60 years. If your parents are senior citizens, then the tax exemption limit will be Rs 50,000.
Tuition Fee
You can get tax exemption on the tuition fee portion of the school/college fees you pay for your children's education. Under Section 17 of Income Tax Act 80 (C), there is a provision for income tax exemption for parents paying tuition fees or school fees. This exemption can be availed on the tuition fees of two children. But to get this exemption, you will have to submit the admission certificate and fee receipt from the institute.
