As the deadline for filing income tax returns (ITRs) approaches on July 31, 2024, taxpayers gearing up for the assessment year 2024-25 should be well-versed in the avenues available for trimming their tax bills. With the advent of online ITR filing, navigating through the tax landscape has become more accessible than ever. However, many may have overlooked key deductions and exemptions, leaving money on the table.
HRA Tax Exemption:
Even if you missed the deadline to submit your rental agreement by March 31, 2024, don’t despair. You can still claim the House Rent Allowance (HRA) tax exemption when filing your ITR. This exemption can significantly reduce your tax burden, especially if you’re a salaried or self-employed individual residing in a rented property. Remember to report your landlord’s PAN if your annual rent exceeds ₹ 1 lakh.
Deductions Available Under Section 80C:
Utilise investment options like the National Pension System (NPS), Equity-Linked Savings Scheme (ELSS), Unit Linked Insurance Plan (ULIP), and Public Provident Fund (PPF) to avail tax deductions up to ₹ 1.5 lakh. Additionally, contributions to the Sukanya Samriddhi Account and payments towards life insurance premiums qualify for deductions under this section.
Utilise These Expenses:
Expenses such as tuition fees for up to two children, registration or stamp duty charges for a home or property, and principal repayment of home loans are eligible for deductions. Make sure to include these expenses while filing your ITR to maximise tax benefits.
NPS Investment:
Investing in the National Pension System (NPS) can yield substantial tax savings under the new regime. Coupled with the ₹ 1.5 lakh deduction under Section 80CCE, an additional ₹ 50,000 exclusive to NPS (Tier I account) is available. Corporate subscribers can enjoy further benefits under Section 80CCD (2).
Deductions Under Section 80(D):
Premium payments for health insurance policies can fetch deductions of up to ₹ 25,000 under Section 80D, rising to ₹ 50,000 for premiums paid for senior citizen parents. Unreimbursed medical expenses for senior citizen parents and preventive health check-up costs are also eligible for deductions.
Interest from Savings Account:
Interest earned from savings accounts can be deducted from your tax liability under Section 80TTA, with a maximum deduction of ₹ 10,000. Senior citizens can claim up to ₹ 50,000 under Section 80TTB for interest earned from savings accounts, fixed deposits, and post office deposits.
Navigating the maze of income tax regulations can be daunting, but with careful planning and attention to detail, taxpayers can optimise their tax savings and ensure compliance with the law. Remember, every rupee saved in taxes is a rupee earned for your financial future.
