Business News Desk, The time to file income tax is fast approaching. Also the financial year 2022-23 is going to end. In such a situation, income tax will have to be paid on the income earned in the financial year 2022-23. On the other hand, if your income is taxable, then tax will have to be paid on that too according to the income tax slab. On the other hand, if you file tax according to the old tax system, then you can also get the benefit of many types of tax exemption.
There are various instruments in which you can claim tax exemption by investing. You can claim a deduction of up to Rs 1.5 lakh under Section 80C deduction of the Income Tax Act (ITA) of India. For this, you can invest in Employees Provident Fund (EPF), Public Provident Fund (PPF), Equity Linked Savings Scheme (ELSS), Sukanya Samriddhi Account, Tax Saving FD, National Savings Certificate (NSC) and Senior Citizen Savings Scheme.
Repayment of home loan principal and interest payments can be a massive tax saver for you. For an ongoing home loan, you can claim a deduction on repayment of the principal amount under Section 80C. You can also allow a deductible of up to Rs 2 lakh on home loan interest payments. However, to reap the full benefits, the home loan needs to be large.
Tax exemption can be availed on interest payment of education loan. There is no limit on the deductible amount. However, unlike home loans, principal repayment waiver is not available. Try to consult someone with experience in investment banking to get maximum tax saving benefit from the loan.