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Home›Finance›Tips on how you can save tax on your salary

Tips on how you can save tax on your salary

By John Hurley
March 7, 2023
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how to save tax on salary is one of the most possible questions in people’s mind, well in this article we would discuss how to save tax on salary. Well, You must pay special attention to the financial items that can reduce your tax liability if you want to save a sizable portion of your income in India. Sections 80C, 80CCC, and 80CCD in India allow professionals who are salaried to reduce their tax obligations.

It’s highly likely that you have not planned your taxes adequately if you feel like you have been paying a significant portion of your income in taxes. There are many legitimate strategies to reduce your tax liability. The Income Tax Act of India enables citizens to reduce their tax obligations through deductions. When filing their tax returns, people can claim the deductions.

Here are some suggestions to help you how to save tax on salary:

  • Deductions under Sections 80C, 80CCC, and 80CCD

Indian nationals can save on taxes because to these three components. People who own investments in the things listed in Sections 80C, 80CCC, and 80CCD may be qualified for various deductions. Just a few examples of common investment vehicles are PPF Accounts, Pension Plans, Life Insurance Policies, NSCs (National Savings Certificates), 5 Year Tax Saving Fixed Deposits, and others.

The most that citizens may deduct under one section, all three sections, or both is Rs. 1,50,000. Investors in the National Pension Scheme are eligible for an additional deduction under Section 80CCD of Rs. 50,000.

  • Medical Costs

Taxpayers can deduct the cost of medical care from their taxable income and is  great answer to how to save tax on salary. People’s medical expenses become tax-free if they provide the necessary medical invoices. Additionally, corporations offer medical benefits to every employee. The annual maximum that can be claimed by individuals using medical expenses is Rs. 15,000 The Income Tax Act permits deductions under Sections 80D, 80DD, and 80DDB on income that has been used by the taxpayers to purchase health insurance for themselves or a family member. The amount of the deduction may differ for each part and is based on the kind of insurance coverage the taxpayer has bought.

  • Housing Loan

The majority of people are encouraged to take out a home loan in order to reduce their tax burden because there are three parts in which deductions may be made, which can yield considerable tax savings. Section 80C of the Income Tax Act permits consumers who take out a house loan to deduct interest payments on the principal loan amount. People may deduct the interest they have paid on their mortgages under Section 24. In some circumstances, a deduction for the amount used to pay the interest on a home loan may be claimed up to a maximum of Rs. 2,00,000; however, in other circumstances, there is no maximum deduction that may be claimed.rel=”nofollow”

  • Student Loan

Another answer to  how to save tax on salary is by choosing an education loan for further education for themselves, their children, their spouse, etc., people can avoid paying taxes. Under Section 80E of the Income Tax Act, individuals may deduct the amount they paid for paying the loan interest. They are allowed to deduct any number of times in total. Section 80E only permits individual taxpayers to deduct expenses.

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