With the deadline for income tax return (ITR) filing fast approaching on July 31, 2024, taxpayers are on the lookout for ways to maximise their tax refunds. Amidst the plethora of deductions available, there are some lesser-known gems that can significantly reduce your tax liability, as highlighted by Amarpal S Chadha, tax partner and mobility leader at EY India.
‘While the new tax regime offers limited deductions, the old regime still holds opportunities for savvy taxpayers,’ says Chadha.
Here are five lesser-known deductions worth exploring:
National Pension Scheme (NPS):
Contributions to NPS Tier 1 accounts qualify for an additional deduction of ₹ 50,000 under section 80CCD(1B), supplementing the existing deduction of up to ₹ 1,50,000 under Section 80C.
Rent Paid Deduction:
Salaried individuals without House Rent Allowance (HRA) or self-employed individuals can claim a deduction for rent paid under section 80GG, subject to certain conditions.
Medical Expenditure for Senior Citizens:
Apart from medical insurance premiums, expenses incurred on medical treatment of senior citizen parents not covered by insurance are eligible for deduction up to ₹ 50,000 per year under section 80D.
Preventive Health Check-ups:
Deductions under section 80D are available for expenses on preventive health check-ups for self, spouse, dependent children, and parents, capped at ₹ 5,000 per year.
Electric Vehicle Purchase:
Taxpayers can claim a deduction of up to ₹ 1,50,000 under section 80EEB for interest paid on loans taken for purchasing electric vehicles, provided the loan was approved between January 1, 2019, and March 31, 2023.
Additionally, donations to charitable institutions under section 80G and popular deductions like Section 80C (PPF, EPF, ELSS, NSC), Section 24 (home loan interest), Section 80E (education loan interest), and House Rent Allowance should not be overlooked.
As the deadline looms, taxpayers are encouraged to seize these opportunities to minimise their tax burden. By leveraging these lesser-known deductions, you can ensure a more substantial refund and keep more money in your pocket. Don’t miss out—file your ITR before July 31st and claim what’s rightfully yours!
