Indian income tax rules provide multiple ways to reduce taxable income, but most taxpayers only use the Rs 1.5 lakh deduction under Section 80C. Due to a lack of awareness, many fail to utilize other tax-saving options. By understanding the various opportunities available, each taxpayer can reduce their tax burden, as a penny saved is a penny earned. In this article, we list all the ways to save tax, under section 80C of the Indian Income Tax Act and sections beyond 80C.

Tax Savings Schemes under section 80 C in India –

Investment Source	Lock-in Period
5-Year Bank Fixed Deposit	5 years
Public Provident Fund (PPF)	15 years
National Savings Certificate	5 years
National Pension System (NPS)	Till Retirement
ELSS (Equity Linked Saving Schemes) Funds (Mutual Funds)	3 years
Unit Linked Insurance Plan (ULIP)	5 years
Sukanya Samriddhi Yojana (SSY)	N/A
Senior Citizen Saving Scheme (SCSS)	5 years

The Indian government has implemented several programs to make housing more accessible to people. As part of this effort, various government-mandated schemes such as PMAY (Pradhan Mantri Awas Yojana) and DDR (Delhi Development Authority) Housing Scheme have been introduced. Additionally, Sections 80C and 24(b) of the Income Tax Act provide tax benefits, which minimize the monetary liability through lower tax burdens.

Under Section 80C of the Income Tax Act, individuals can claim deductions up to Rs 1.5 lakh on the annual income spent on repayment of the principal borrowed amount when purchasing a home loan.

Investing in government schemes such as Senior Citizen Savings Scheme (SCSS), Sukanya Samriddhi Yojana (SSY), National Pension Scheme (NPS), Public Provident Fund (PPF), and National Pension Scheme (NPS) can offer high returns on total investments along with tax waivers. Under Section 80C of the Income Tax Act, individuals can claim tax waivers on up to Rs 1.5 lakh spent on such investments.

Life insurance plans can also provide tax benefits. Under Section 80C of the Income Tax Act, individuals can claim tax benefits of up to Rs 1.5 lakh paid on annual premiums. If the policy was purchased before April 1, 2012, claims under Section 80C can be filed as long as the total premium payments do not exceed 20% of the sum guaranteed. Life insurance coverage acquisition or renewal and annuity payments on such plans made through monthly salary are eligible for tax exemptions of up to Rs 1.5 lakh under Section 80CCC. Only certain pension funds under section 23AAB are eligible for exemptions of up to Rs 1.5 lakh under section 80CCD(1).

Section 80CCD

Deduction For – Contributions to National Pension Schemes (NPS)

Deduction Limit – Rs 50,000

Contributions made by an employee, employer, or voluntary self-contribution are eligible for deduction. Section 80C allows an overall deduction of Rs 1,50,000 lakh plus an additional deduction of Rs 50,000 for self-contributions to NPS or Atal Pension Yojana under Section 80CCD(1b).

These are among the most popular tax-saving options available to individuals and HUFs in India.

Summary of Tax Deductions Available under Section 80D to 80U (as in the table below)

One of the most sought-after tax-saving options is Section 80C, which provides various investment avenues to help taxpayers reduce their tax liability. The section provides an extensive list of tax-free investment options. It includes life insurance premiums, PPF contributions, five-year term deposits, and ELSS schemes, among others.

The maximum exemption you can claim through Section 80C investments is Rs 1,50,000. However, you can claim an additional Rs 50,000 by investing in NPS (National Pension System) through Section 80CCD, which brings your total deduction to Rs 2 lakhs.

Apart from Section 80C, there are other tax-saving exemptions that you may qualify for. Some exemptions are under Section 80, while others are under different sections. Let’s take a look at what they are.

Here is a complete list of tax-free deductions available apart from 80 C as below –

Sections	What They Deal In	Exemption Limit
80D	Health insurance premiums	1) Up to Rs 25,000 for oneself + family (including spouse and child). 2) Up to Rs 50,000 for oneself and family + parents 3) Up to Rs 75,000 for Oneself and family (below 60 years) + Parents above 60 years of age 4) Up to Rs1,00,000 for Oneself and family (with members above 60 years) + Senior Citizen Parents
80DD	Expenses on a handicapped dependent	1) Rs 75,000 for people with 40% to 80% disability 2) Rs 1,25,000 for people with higher than 80% disability
80DDB	Treatment of specified illnesses	Rs 40,000 (Rs1,00,000 for senior citizens)
80E	Education loan interest payment	No limit
80EE	Home loan interest payment for first-time home-owners	Up to Rs 50,000
80G	Donations to approved charitable institutes	No Limit
80GG	Rent paid by employees not having HRA	Lower of the following – 1) Rs 5000/month 2) The total annual income of 25% 3) 10% of the basic annual income
80GGA	Donations for Scientific Research and Rural Development	No Limit
80GGB	Donations Made to an electoral trust or Political Parties. (Indian companies are eligible to claim benefits)	No Limit
80GGC	Contributions made to a political party	No Limit
80TTA and 80TTB	Saving account interest	1) 80TTA – Up to Rs10, (individuals below 60 years) 2) 80TTB – Up to Rs10,000 for senior citizen
80U	Handicapped tax-payers can claim this deduction	1) Rs 75,000 for 40% to 80% disability 2) Rs 1,25,000 for higher than 80% disability
80RRB	Royalty or patent income	Up to Rs 3 lakhs

Section 24(b)

Deduction For– Income from house property

Deduction Limit – Rs 2 lakhs

Did you know that you can save on taxes by taking a home loan? According to Section 24(b), you can claim a deduction on the interest paid on your home loan of up to Rs 2 lakhs per year, provided that the construction is completed within five years of the loan term.

Furthermore, if you rent out your newly purchased property, the entire interest component is exempt from annual income tax computations.

If you’re planning to build a home, you can also take advantage of Section 24(b) as long as the construction is completed within five years. In addition, Section 80EEA allows for an extra deduction in the annual tax liability for first-time homeowners.

Section 10(13A)

Employees who earn a salary may be eligible to receive a House Rent Allowance (HRA) as a part of their pay. If you are renting a home, you can claim an HRA exemption. The exemption is limited to the lower of the following amounts:

– The actual HRA received by you

– 50% of your salary if you reside in a metro city, or 40% if you live in a non-metro city

– Rent paid minus 10% of your annual salary.

Other Exemptions

1. In addition to the exemption for House Rent Allowance (HRA), you can take advantage of tax exemptions on Leave Travel Allowance, meal coupons, conveyance allowance, medical allowance, and more.
2. The gifts received during a marriage whether from relatives or friends are exempted from tax.