How Can We Save Tax More Than 1.5 Lakh?

Is PF and PPF same?

EPF is deducted from the salary of salaried individuals while PPF is invested into by citizens.

Both help you save on income tax.

EPF is offered by retirement fund body EPFO or Employees’ Provident Fund Organisation while PPF is offered by banks and post offices..

Is 80ttb part of 80c?

Ans. Yes, it is over and above the limit of Rs 1.5 lakhs u/s 80C. From the FY 2020-21 the benefit under section 80TTB will only be available under the old tax regime and taxpayers opting for new tax regime cannot claim this benefit while filing ITR.

Can I invest more than 1.5 lakhs in 80c?

Although there is no restriction on the amount one can invest in it, investments up to Rs 1.5 lakh in a financial year is exempt under section 80C of the Income Tax Act.

What is the maximum limit for 80c?

Rs 1.5 lakhsAccording to the section 80CCE, the maximum aggregate deduction that can be claimed under section 80C, section 80CCC and section 80CCD (1) cannot exceed more than Rs 1.5 lakhs. This section allows deduction from gross total income for contributions made to pension schemes of the Central Government.

How is tax calculated?

Tax is charged as a percentage of your income. The percentage that you pay depends on the amount of your income. The first part of your income, up to a certain amount, is taxed at 20%. This is known as the standard rate of tax and the amount that it applies to is known as the standard rate tax band.

What is the 80c limit for 2020 21?

The maximum deductions available under a few sections are as follows: Section 80C to 80CCC: ₹ 1,50,000. Section 80CCD: ₹ 50,000. Section 80D: ₹ 30,000 for self, spouse and children, ₹30,000 for parents, ₹50,000 for senior citizens.

What is 80 C in income tax?

It allows taxpayers to reduce their taxable income by making investments and some expenses and thus save on taxes they pay. Currently, section 80C allows deduction from gross total income (before arriving at taxable income) of up to Rs 1.5 lakh per annum on eligible investments and specified expenses.

What is 80c exemption?

Section 80C of the Income Tax Act of India is a clause that points to various expenditures and investments that are exempted from Income Tax. It allows for a maximum deduction of up to Rs. 1.5 lakh every year from an investor’s total taxable income.

Is SIP tax free?

I want to know if my SIP investment can be used for tax exemption? … Investments in Equity Linked Saving Scheme or ELSS qualify for tax deductions of up to Rs 1.5 lakh under Section 80C in a financial year. However, the tax benefit is only available to ELSS or tax saving mutual fund schemes.

What are the best tax saving options?

Best Tax-Saving Investments Under Section 80CInvestmentReturnsLock-in PeriodELSS Fund15%-18%3 yearsNational Pension Scheme (NPS)12%-14%Till RetirementUnit Linked Insurance Plan (ULIP)Returns vary from plan to plan5 yearsPublic Provident Fund (PPF)7%-8%15 years5 more rows•Oct 14, 2020

What reduces AGI?

Some deductions you may be eligible for to reduce your adjusted gross income include:Alimony.Educator expense deduction.Health savings account contributions.Retirement plan contributions, like IRA or self-employed retirement plan contributions.For the self-employed, health insurance and one half of S/E tax.More items…

What if I invest more than 1.5 lakhs in PPF?

The maximum limit of Rs 1.5 lakh implies that you cannot claim deduction on full amount when the sum of your total contribution in PPF account and other schemes allowed under Section 80 is more than Rs 1.5 lakh in a financial year.

How do rich save taxes in India?

35 Easy Ways to Save Income Tax in India 2020#1. Interest Income on Saving Account.#2. Interest Income on NRE Account.#3. Maturity or Claim Amount Received on Life Insurance.#4. Educational Scholarship.#5. Profit From Selling Shares or Equity Mutual Funds.#6. Amount Received as Gifts on Marriage.#7. … #8.More items…•

How can I save my tax after 80c?

In this article, let’s take a look at the tax-saving options other than Section 80C to turn you into a smart tax saver.Section 80CCD: National Pension Scheme. … Section 80D: Payment of health insurance premium. … Section 80E: Repayment of an education loan. … Section 24: Interest payment of a home loan.More items…•

How can I reduce my taxable income?

The simplest way to reduce taxable income is to maximize retirement savings. Both health spending accounts and flexible spending accounts help reduce tax bills during the years in which contributions are made.

How can we save tax?

Below-enlisted are the 7 best tax saving options other than Sec 80C.National Pension Scheme (NPS)Interest on education loan (Section 80E)Rajiv Gandhi Equity Savings Scheme (Section 80CG)Home Loans.House rent allowance (Section 80GG)Health Insurance (Section 80D)Medical treatment under Sec 80DDB.More items…•

Is PF part of 1.5 lakh investment?

PF Tax Benefit: The maximum limit of Section 80C is Rs 1.5 lakh per financial year and there are several investments, expenses including PF contributions of an employee that are eligible for tax benefit under this Section.

Can we have two PPF accounts?

The PPF rules allow the same individual to open another account in the name of a minor but it does not allow to hold more than one PPF account in one’s own name. While only one PPF account is allowed to be opened in one’s name, there could be a possibility that one ends up holding multiple PPF accounts.