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Thursday, September 29, 2022

Ways to Save Income Tax Under Section 80C – Income Tax Saving Investment Schemes

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Know About All The Ways How You Can Save Income Tax In India – Tax Saving Rules In India

Section 80C

Section 80C is the most prevalent sections under which deductions are claimed by individuals. This Section, which permits a deduction of up to Rs. 1.5 lakh is available to all taxpayers, regardless of income source.  

Ways to Save Income Tax Under Section 80C

There are several ways to invest and get a tax rebate under this provision. Some of which are detailed below.

  • Life Insurance

    Section 80C allows deduction up to Rs. 1.5 lakh on the payment of life insurance premiums of your family, which in turn includes your spouse, children and yourself, but does not have the provision to include payment of insurance premium for your parents.
  • ELSS Scheme

    Equity Linked Savings Schemes (ELSS) are so designed by the Mutual Fund companies as to as tax saving schemes. Usually, these schemes have a lock in period of 3 years, and under this a maximum of Rs. 1.5 lakh may be deducted for the fiscal year.
  • National Pension System

    The National Pension System (NPS) allows any working professional to invest in their own personal pension plan, under which up to Rs. 1.5 lakh is the allowed deduction under section 80C. The amount invested is locked in till the age of 60.
  • PPF

    Issued by the Central Government itself, the Public Provident Fund (or PPF) is a safe and popular tax-saving investing plan wherein you can claim a tax deduction of Rs. 1.5 lakh each year under Section 80C.
  • EPF

    Employee Provident Fund (EPF) is another government-backed retirement savings plan that is offered to all salaried employees in India in the organised sector. Under this scheme too you may claim a tax deduction for a fiscal year.
  • Home Loan Repayment

    The repayment of the principal part of a home loan is also eligible for a deduction under Section 80C.
  • Sukanya Samriddhi Yojna

    Premiums paid as investment to the maintenance of Sukanya Samriddhi account for female children are likewise deductible, with a maximum investment of Rs 1.5 lakh each fiscal year.
  • Tuition Fee for 2 Children

    The amount paid as tuition fee for 2 children is deductible under the section 80C. This is in case the fee is paid for a full-time education and is allowed for only up to 2 children.
  • Fixed Deposit of more the 5 Years

    Section 80C deductions are also available for investments in 5-year fixed deposits. It is important to remember that it is not permitted for all fixed deposits, but only for those with a term of more than 5 years.

Taxes are a way to keep the country running, and fuel the next development for individuals like us. While they are necessary, the government also has provided many easy rebates for you enjoy the benefits of your hard-earned money. Invest wisely!

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