Saving Taxes as per Income Tax Act.
As per Income Tax Act few investments can be used to save the taxes. It also has an maximum limit up to which the amount invested in exempted from the income tax.
- Life Insurance Premiums
- Contributions to Employees Provident Fund/GPF
- Public Provident Fund (maximum Rs 70,000 in a year)
- Unit Linked Insurance Plan (ULIP)
- Repayment of Housing Loan (Principal)
- Equity Linked Savings Scheme (ELSS)
- Tuition Fees including admission fees or college fees paid for Full-time education of any two children of the assessee (Any Development fees or donation or payment of similar nature shall not be eligible for deduction).
- Infrastructure Bonds issued by Institutions/ Banks such as IDBI, ICICI, REC, and NHAI.
In totality under Section 80C an individual can invest maximum amount of Rs.100,000/- (from tax point of view) which results a maximum savings of Rs.33,990/- in the income tax.
Mediclaim Premium (Section 80D)
Any individual or HUF (for self and family) can avail the benefit of Mediclaim upto a maximum of Rs.10,000/- in case of senior citizen the limit is Rs.15,000/-. One can now get the benefit of both if the parents are dependents on that individual.
Donations to the Charitable Institution (Section 80G)
One can avail the benefit of Donation to certain charitable institutions approved by Income Tax authorities This deduction will be 50% of the amount or if the donation is given to Prime Minister Relief Funds, National Foundation for Communal Harmony, Blood Transfusion Council, The Africa Fund, Earth-quake Relief Fund will get a deduction of 100%.