Income Tax Calculator: Expert Pankaj Mathpal reveals top 5 ways to save tax without investment
Income Tax Calculator: The deadline (31st March 2021) for investment declaration to claim tax deduction for FY 2020-21 is fast approaching. Hence, earning individuals are busy finding ways to save their hard earned money meant for income tax outgo.
Income Tax Calculator: The deadline (31st March 2021) for investment declaration to claim tax deduction for FY 2020-21 is fast approaching. Hence, earning individuals are busy finding ways to save their hard earned money meant for income tax outgo. While some people are busy buying insurance policies some are found investing in Section 80C investment options like Public Provident Fund (PPF), Post Office Saving Schemes, etc. However, for information to such earning individuals, one can save income tax without making any investments. They can claim income tax benefits for some of their regular expenses like tuition fees paid for their children at their school, home loan, health insurance and health checkups, etc. These are some of the expenses that one needs to add before making any investment to claim income tax relaxation.
Speaking on the income tax benefit offered by the Income Tax Department on other than investment options Pankaj Mathpal, Managing Director at Optima Money Managers said, "Regular payments like tuition fee of one's children paid at their school, medical check up of one's dependent, principal paid on home loan, medical expenses on one's parents (if they are not insured), interest paid on education loan, etc. are some of the heads that qualifies for income tax exemption." Mathpal advised earning individuals to mention these expenses in their tax deduction investments for the financial year 2020-21.
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Pankaj Mathpal list out the following expenses that can help an earning individual save income tax outgo in FY 2020-21:
1] Tuition Fee: For those who have expenses related to the tuition fee of children can claim up to Rs 1.5 lakh incurred on the same under Section 80C of the Income Tax Act. This means if a parent pays Rs 60,000 each for two children then Rs 1.2 lakh can be claimed under the deduction. The tuition fee paid to any college, school, university, college or any educational institute in India can be availed for upto two children for a given financial year and is an effective way for reducing your burden.
2] Home Loan Principal Repayment: An amount of Rs 1.5 lakh can also be claimed under Section 80C against repayment of the principal amount of a home loan taken during a financial year. In fact, if you have bought the house in FY 2020-21, then you can claim income tax benefit on the stamp duty payment too. However, after claiming this income tax deduction, one won't be able to sell the property within five years.
3] Education Loan Interest Repayment: If an earning individual has availed education loan for its children or for itself, then in that case, one can claim income tax exemption on 100 per cent education loan interest repayment under Section 80E of the Income Tax Act.
4] Health Checkups: If the earning individual has spent on the health checkups of oneself and other dependents of the family like wife and children, then they can claim income tax deduction under Section 80D of the Income Tax Act.
5] Health Checkup Expense on Parents: If the earning individual's parents are not covered by any insurance, in that case health checkup expenses up to Rs 50,000 is exempted from any income tax outgo under Section 80D.
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