Are you on a path of constant hustle to ensure that your money is invested in the right area and investments that end up giving you tax benefits? In India, there currently are several saving schemes that will help you in getting tax benefits and lighten the pressure.

Most of the saving schemes in India are under Section 80C of the Income Tax Act. 

Apart from this, there are provisions under Section 80D wherein you can save tax up to Rs 1 lakh.

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Section 80C decoded

Saving Schemes like PPF, NSC, NPS are all a part of 80 C and help you save as well as get tax benefits.

PPF

Apart from getting you sorted for the next several years, PPF gives you the opportunity to save Tax. Currently the interest rate on PPF stands at 7.1 per cent per annum which is compounded annually.

The minimum contribution for the PPF account is Rs 500 and a maximum of Rs 1,50,000 in a financial year. The deposit can be made in lump-sum or in instalments.

NPS

If you want to apply for the National Pension Schemes; you should be in the age bracket between 18–70 years as on the date of submission of his/her application, according to details given in India Post.

This particular scheme provides tax deduction up to 10 percent of Salary (Basic+DA) under Section 80 CCD(1). You will be eligible for tax deduction up to 10 % of Salary (Basic+DA) contributed by the employer under Sec 80 CCD(2) over and above the limit of Rs 1.50 lacs provided under Sec 80 CCE.

Apart from the above mentioned points, the tax saver fixed deposit (FD) is one schemes that has fixed a tenure of five years and carries a fixed rate of interest. 

By investing in this five-year FD, you can claim tax benefits under Section 80C up to Rs 1.5 lakh.

Also, Home Loan Payment is a part of 80 C. If you plan to buy a house and have a home loan to repay, then the EMI that you have to pay on the principal amount is allowed for tax deduction under Section 80C.

Section 80C includes multiple investments through which you can claim deductions on your total income. There however is an upper limit of Rs 1.5 lakh in a financial year.

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Section 80D decoded

Section 80 D Health or Medical Insurance for self/family

This saving scheme is commonly called a medi-claim policy and works as health insurance. 80 D not only helps insure your person and family’, this can also save your taxes. 

This comes under the Income tax act and allows deduction for premium paid for health insurance policy subject to defined limits.

For this policy and tax saving element, you can opt to pay the premium for yourself, spouse, children and parents to be eligible for deduction.

Coming to the cost part, the amount of deduction depends upon your relationship with the person for whom you are paying and the person’s age. 

In case you are under the age of 60 years and paying the premium for yourself, your spouse or your children, would naturally be eligible for a deduction of the actual annual premium paid. The limit for this currently is Rs.25,000.

In case, you are also paying the premium for your parents, you are eligible for an additional deduction of the actual annual premium paid for parents. Again the limit for this is Rs.25,000. 

In case, your parents fall under the senior citizen category , you become eligible for an enhanced deduction of 30000 instead of 25000.

In a case where you are above the age of 60 years or above and paying the premium for yourself, your spouse or your children, you would be eligible for a deduction of the actual annual premium paid. The maximum limit here is Rs.30,000. 

Now, If you are also paying for your parents, you get eligible for an additional deduction of the actual annual premium paid for parents. Maximum limit for this too is Rs.30,000.

This way you can save a lot and invest the amount in your future!

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