New Tax Saving Options Other than 80C FY 2013-14(AY 2014-15)

Tax Saving Options Under 80D, 80DD, 80DDB, 80E, 80G, 80GG, 80GGC, 80U, 80CCG, 80GGA, 80TTA

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For the individuals or company in India, if the gross income is under taxable income, has to pay tax. However with the provisions available in the income tax sections exemptions are given on certain incomes. There are many tax saving options , on which an individual/company can avail tax exemption on total income.

Tax saving planning is one of the main objects for an individual who come under taxable income. Its not wise one to wait till the end of the financial year. Plan early to avoid confusions and analyze the various sections of tax deductions under the Income Tax Act .

We already discussed about the tax deductions under Section 80C (Click here to know about Section 80C deductions). Planning of tax doesn’t end with Section 80C. Apart from 80C several tax emption sections are available in Income tax act. So, its prudent to analyze other tax deductions provided by the Income Tax Act, 1961 and start looking beyond 80C. Here, we take an attempt to understand them briefly to benefit you.

80D-Medical Insurance

The premium which is paid towards Mediclaim/Health insurance for self, Spouse, children and parents is considered tax deduction under U/s 80D. The sudden medical expenses incurred for self and family members comes under this section. The maximum amount for claiming deduction is Rs.15,000. The individuals above 60years of age can avail tax deduction Rs 20,000. For buying health insurance for parents(senior citizens) can get an additional deduction of 15,000/- can be deduction. This deduction can be claimed irrespective of parents being dependent on you or not. This in not applicable for in-laws mediclaim policies.

80DD-Handicapped Dependents

If you having dependent who is differently abled, the there is provision to get deduction for expenses on his maintenance and medical treatment. Paying premium for the medical treatment of a dependent physically disabled person, you can avail exemption under the section 80DD. You can get these claim up to Rs 50,000 or actual expenditure incurred, whichever is lesser. For severe conditions this limit exempted up to 1lakh. The exemption applies those, the dependents(parents, spouse, children or sibling) should not have claimed any deduction for self. The diseases like Blindness and Vision problems, leprosy cured, Hearing impairment, Locomotors disability , mental retardness or illness with 40% or more considerable under this section.

80DDB - Treatment of Certain Diseases

The expenditure incurred for the medical treatment of self or your dependents can claim a deduction of up to Rs. 40,000 or the actual amount paid, whichever is less, under the section 80DDB. Dependent can be parents, spouse, children or siblings with completely dependent on you. For a senior citizen this exemption is Rs. 60,000, or the amount actually paid for medical expenses. The individuals who want to claim a deduction under this section need to submit a medical certificate from a doctor working in a government hospital. Diseases like Neurological, Parkinson, Malignant Cancers, AODS, Chronic Renal Failure, Hemophia, Thalassemia covered under this section. The expenses claimed by the insurance companies not considered under this section and cannot be exempted.

80E - Education Loan

The education loan interest for pursuing higher education for self and dependent is completely tax exemptible. The exemption is only for interest on education loan and no deduction on principal paid. The loan education loan for self , spouse or children only. For pursuing full time courses only this loan interest deductible is applicable. This deduction is applicable for a period of eight years or till the interest is paid, whichever is earlier.

80G - Donations to approved charitable organizations

The donations given to charitable organizations can get tax deduction u/s 80G. The donations made under philanthropic ground are exempted for 100% of the amount donated while for others its 50% of the donated amount. Receipts issued by the charitable institution with singed , stamped and registration number issued by Income Tax Deparment printed on it , is must and considered for tax deduction. The name on the receipt should match with that on PAN number. The donations made to approved organizations and institutions qualify for deduction. Only donations made in cash or cheque are eligible for deduction.

80GG - House Rent in case HRA is not part of Salary

For salaried individuals as a salary component or self-employed person staying in a rented house does not receive any kind of HRA, they can claim a deduction under 80GG. If you or your spouse or your children having own home can’t get tax deduction under this section. You can claim tax deduction Rs 2000 or 25% of annual income or rent paid 10% of annual income whichever is less.

80GGC - Donation to Political Parties

The contributions to any political party registered under section 29A of the representation of the People Act, 1951 U/c 80GGC are tax exemptible under this section 80GGC. The maximum contribution exemption is limit to 10% of your gross income.

80U - Physically Disabled Assesse

The individual resident of India, who is suffering from specified disability can get tax deduction u/s 80U In order to avail this deduction one should from disabilities like Blindness and Vision problems, Leprosy cured, Hearing impairment, Locomotor disability, Mental retardation, Autism, Cerebral Palsy . For normal disabilities with 40% or more disabilities the tax deduction is Rs 50,000. For more than 80% disability can avail tax deduction Rs 1,00,000/- .

80CCG - Rajiv Gandhi Equity Savings Scheme

RGESS is one of the latest Tax Saving Scheme in the finance Act 2012, which was introduced in Budget 2012. To encourage investments first time in the field of stock market this section is applicable and can take advantage for three consecutive years. The investment made in certain stocks which is in CNX-100 is taking in to consideration Under RGESS. You are eligible for tax deduction on 50% of the amount invested. The maximum amount eligible for investment in a year for RGESS is Rs 50,000 and the deduction is 25,000/- which half to the investment and can take advantage of RGESS for three consecutive years. The mutual funds and ETF which is investing only CNX-100 are also eligible for RGESS. To claim deduction under this , individuals having the a/c as RGESS by filling relevant form. Producing Xerox copies of RGESS enabled Demat statement can get deduction. The gains on RGESS is tax free. It is attractable and convenient because of short locking period.

80GGA - Scientific Research Donation

Full tax deduction is on donations made towards to the scientific research u/s 80GGA.Donations to a scientific research association or university, college or other institution for undertaking of scientific research, any programme of rural development is coming under this section.

80TTA - Interest on Saving Account

According to the 80TTA, which is newly introduced in Budget 2012, allows deduction of Rs 10,000 on interest earned on saving bank account.

80EE - Home loan interest Additional Deduction

In the Budget 2013 has introduced a new section 80EE, which gives additional exemption up to Rs 1 lakh on payment of interest on Home loan. The loan which is taken from banks or housing finance companies in the financial year 2012-13 is applicable to this and also the house, which Is not cost more than Rs.40 lakh. The borrower should not own any other property at the time of loan sanction. The additional deduction on interest payment of home loans can be claimed in financial year 2013-14. In case, if you are not able to exhaust the limit in financial year 2013-14, the balance can be claimed in FY 2014-15.

SEC 24 - Home Improvement Loan Interest

The individuals who take home improvement loan, can avail tax deduction up to Rs 30,000 on interest paid on it. No deduction is applicable to principle repayment. The loan is taken for furnishing a new home or repairing or refurnishing existing home is eligible to get tax deduction.