Indian education has left the investment sector untouched, which adds a lot of pressure on the grown-up adult. With almost no knowledge of tax structure and exemption limits, all of us end up paying more taxes than we are supposed to.
Internet, on the other hand, has helped a lot of millennial to educate themselves financially; with the increasing financial education and personal finance management services, people from around the corner are able to save more taxes. Investments are growing, taxes are being saved and a lot of useful assets are being acquired.
Almost every other millennial is making the best use of the exemptions provided under 80C section; everyone with an annual income of 5-8 lacs is saving 1,50,000INR in taxes by investing in LIC, PPF, EPF, FD, and ELSS. While saving taxes through 80C is a good step towards a happier tomorrow, people are also missing out on other exemptions.
Yes! There are exemptions that can help you save more taxes other than 80C, are you intrigued, keep reading!
People grow ignorant once they have claimed exemptions through section 80C and stop looking for other ways of saving more taxes. Here are the three exemptions through which you and everyone else can save extra taxes.
Section 80G: Not a big fan of government and the ways they spend the taxes you pay, here’s a way for you to not pay any taxes and contribute directly for the welfare of the society. Contributing or donating the sum to relief funds like Prime Minister’s national relief fund can help you save 50% to 100% taxes on the donated amount.
P.S: You cannot claim more than 10% of your annual gross income through this exemption.
Section 80E: Still working hard to pay off the education loan you acquired to finance your education? This is certainly not a bad thing, you can go ahead and save taxes under section 80E if you have a running education loan. Students can claim exemption under this section for the first 8 years of repayment of education loan.
P.S: You can claim an exemption for the entire interest you pay to banks. Parents can also claim such taxes if they are the ones paying for such loans.
Section 80D: Got enough insurance to provide for your family in your absence? Good. Now it is time for you to prepare to pay for your medical expenses and not become a burden on your family in case you acquire deadly diseases. Yes! You can also save taxes on medical insurances apart from section 80C. Section 80G is used to provide exemptions on medical insurances and such exemptions can go to 25,000 INR annually.
P.S: You can save additionally 30,000 INR annually if you decide to pay for your parent’s medical insurance too. By paying for your and your parent’s medical insurance, you can save up to 55,000 INR apart from the 1,50,000INR you save through 80C.
In the contemporary age, it is important for all of us to save money and invest them in tools, where we can earn more and more. The growth depends upon how we utilize the limited money we have and not in the varied tools we invest in. Let’s make better use of the available money.