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Can these deductions make you tax free?

Different sections under the Income-Tax Act correspond to different savings or expenses, some of which are eligible for tax deductions and could be a great way to show that you are actually out of the taxable bracket. Here are 8 such deductions.

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Last Updated: Jan 20, 2020, 11.01 AM IST
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By Sudhir Kaushik of Taxspanner

If the net taxable income after all deductions does not exceed Rs 5 lakh, the taxpayer won’t have to pay any tax. Find out if you are eligible for any of these tax deductions to lower your income below the threshold.

1. Savings account interest
Sec 80TTA
Up to Rs 10,000 interest earned on a savings bank account balance is exempt from tax.

2. Medical insurance
Sec 80D
Up to Rs 25,000 premium for medical insurance of self and family and Rs 25,000 for parents (Rs 50,000 if they are senior citizens).

3. Education loan
Sec 80E
Interest paid on education loan for self or dependant. Deduction can be claimed for a maximum of eight financial years.

4. House rent without HRA
Sec 80GG
If taxpayer doesn’t get HRA, he can claim lowest of the following three: Rs 5,000 a month, 25% of income or rent paid minus 10% of income.

Also read: Find out how much you need to invest to save tax

5. Donations
Sec 80G
Donations to eligible organisations can be claimed as deduction. Donations of over Rs 2,000 cannot be made in cash.

6. Purchase of electric car
Sec 80EEB
Up to Rs 1.5 lakh interest paid on loan to buy an electric vehicle is tax deductible.

7. Disability
Sec 80DD and 80U
If taxpayer or dependant suffers from disability, deduction of Rs 75,000-1.25 lakh can be claimed.

8. Medical treatment
Sec 80DDB
Up to Rs 40,000 if taxpayer or dependant suffers from any of the specified disease. Rs 1 lakh in case of senior citizens.
Click here for all the information and analysis you need for tax-saving this financial year
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)

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