Tax planning is an essential part of financial management, and India’s Income Tax Act provides avenues to reduce tax liability through Sections 80C and 80D. Understanding the investments eligible under these sections can help you save tax while securing your financial future.
1. Section 80C: Tax-Saving Investments
Section 80C allows individuals and Hindu Undivided Families (HUFs) to claim deductions up to ₹1.5 lakh per financial year. Popular investment options include:
Public Provident Fund (PPF): Long-term investment with attractive interest and tax-free maturity.
Employee Provident Fund (EPF): Automatically deducted from salary, eligible for tax benefit.
Equity-Linked Saving Scheme (ELSS): Mutual funds with a 3-year lock-in and potential for higher returns.
National Savings Certificate (NSC): Safe government-backed investment.
Life Insurance Premiums: Premiums paid on life insurance policies qualify for deduction.
Home Loan Principal Repayment: Principal portion of home loan EMIs is eligible.
Sukanya Samriddhi Yojana: For parents investing for their daughter’s future.
2. Section 80D: Health Insurance Benefits
Section 80D allows deductions on premiums paid for health insurance policies. Key points:
Self and Family: Up to ₹25,000 deduction for insurance premiums (₹50,000 for senior citizens).
Parents: Additional deduction for insurance premiums of parents (₹25,000/₹50,000).
Preventive Health Checkup: Up to ₹5,000 within the overall limit.
Tip: Combining Section 80C and 80D investments can maximize your total tax-saving potential.
3. How to Plan Your Tax-Saving Investments
Start Early: Invest at the beginning of the financial year to gain the full benefit.
Diversify: Mix safe options (PPF, NSC) with growth-oriented ones (ELSS) for balanced returns.
Keep Records: Maintain receipts and policy documents for claiming deductions.
Review Annually: Adjust investments based on changes in income, tax slabs, and goals.
FAQs
Q1: What is the maximum deduction allowed under Section 80C?
A: Up to ₹1.5 lakh per financial year for eligible investments.
Q2: Can I claim deductions under both 80C and 80D?
A: Yes, they are independent sections, so you can maximize savings under both.
Q3: Are health checkup expenses eligible under Section 80D?
A: Yes, up to ₹5,000 within the overall deduction limit.
Q4: Which tax-saving investment gives the best returns?
A: ELSS has the potential for higher returns due to equity exposure but comes with moderate risk
Published on : 3rd October
Published by : SMITA
www.vizzve.com || www.vizzveservices.com
Follow us on social media: Facebook || Linkedin || Instagram
🛡 Powered by Vizzve Financial
RBI-Registered Loan Partner | 10 Lakh+ Customers | ₹600 Cr+ Disbursed
https://play.google.com/store/apps/details?id=com.vizzve_micro_seva&pcampaignid=web_share