ITR Filing: If you have made investments for tax-savings, then it is necessary to claim deduction for it. Employed people have this information in Form-16. But, those who do not have a job will have to take care of deduction on every tax-saving investment.
ITR Filing: The deadline for filing Income Tax Returns (ITR) is near. If you are using the old scheme of Income Tax, then you should try to avail as many deductions as possible. This will reduce your tax liability. However, employed people would have already given proof of tax-saving investments to their employer. This will give information about all the deductions they are entitled to in their Form-16. Still, it is important to check the deductions given in Form-16 once.
Deductions under section 8C
First of all, taxpayers should try to take advantage of the deduction available under Section 80C of the Income Tax Act . There are about a dozen investment options under this section. Deduction can be claimed by investing in them. Its limit is Rs 1.5 lakh. This means that a maximum deduction of up to Rs 1.5 lakh can be claimed.
Deduction on PPF is the first choice of taxpayers
Under section 80C, there are about a dozen instruments including PPF, EPF, NSC, tax scheme of mutual funds. Among these, the highest return is obtained in the tax savings scheme of mutual funds. It is also called equity linked savings scheme. However, those who do not want to take risk can invest in PPF. Investing in PPF like ELSS creates a good fund in the long term.
Tax exemption is also available on life insurance policy
Deduction is also allowed on life insurance premium under section 80C. Apart from this, deduction can also be claimed on the principal of home loan under this section. Deduction can also be claimed on tuition fees of up to two children under section 80C. This is a deduction for which you do not need to make any additional investment. This is a deduction which is the easiest to claim.
