Income Tax Saving On 10 Lakh Rupees Annual Income If your income is 10 lakh rupees and you are worried that you will have to pay tax, then let us know how you can avoid paying tax.
If your income is 10 lakh rupees and you are worried that you will have to pay tax, then today we are going to tell you some tips, by following which you can avoid paying tax even on income up to 10 lakh rupees. But, now you must be thinking that how can this happen because if you look directly, the income of Rs 10 lakh comes in the income tax slab. In fact, there are many provisions in the existing tax laws, which, if used properly, can significantly reduce the tax burden. You can also void the tax on earning Rs 10 lakh per annum. Let us understand it with example.
Tax expert Balwant Jain told that suppose you earn 10 lakh rupees annually. So in this case, you get a standard deduction of Rs 50,000. With this your taxable income comes down to Rs.9.5 lakhs. Then, in addition to this, you can get a rebate of up to Rs 1.50 lakh by investing in tax saving schemes (life insurance, Sukanya Samriddhi Yojana, children’s fees etc.) under 80C. Doing so, your taxable income comes down to Rs.8 lakh.
He told that to reduce it further, you can take advantage of NPS. Through this, the taxable income can be reduced by another 50 thousand rupees. Apart from this, you can get a discount of 25 thousand rupees through your health insurance and 25 thousand rupees through the health insurance of your parents. With this, your taxable income will now become Rs 7 lakh. Then, if you have taken a home loan, you can avail interest deduction of up to Rs 2 lakh through it. Now your taxable income will be Rs 5 lakh.
Balwant Jain said that on income up to Rs 5 lakh, the government gives a tax rebate of Rs 12,500 under section 87 (A). With this, your taxable income will come down to less than Rs 5 lakh. And, once this happens, you will not have to pay any tax. This income is eligible for full exemption under section 87A.
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