Income Tax: The new financial year i.e. 2025-26 has started and the last date for filing taxes is 31st July. This is the right time for taxpayers to save taxes. If you understand many important sections of the Income Tax Act, of 1961, then you can get an exemption in income tax. Today we will tell you about 5 such income tax provisions, which are very important for every taxpayer to know.
Under this section, you will easily save Rs 1.5 lakh -
Section 80C of Income Tax is the most popular tax-saving option. Under this, taxpayers can get a maximum tax exemption of Rs 1.5 lakh annually. However, for this, you have to invest your money in many schemes. Such as the Sukanya Samriddhi Scheme, 5-year tax saving FD, life insurance premium, PPF, EPF ELSS, etc.
Apart from this, children's school fees and payment of principal amount of home loan are also included in it. However, you should keep in mind that a tax exemption of Rs 1.5 lakh is available by combining all investments. It is not that you will get tax exemption of up to Rs 1.5 lakh on every investment.
Tax exemption will be available through home loan -
If you have taken a home loan and live in your own house, then you can get tax exemption on interest up to Rs 2 lakh annually. If the property is given on rent, then the entire interest amount can be claimed. However, the limit of set-off from other income is only Rs 2 lakh.
For example, you paid interest of Rs 5 lakh on a home loan in a year. But, you got rent of only Rs 2 lakh. This means that you suffered a loss of Rs 3 lakh. In such a situation, you can set off the loss of Rs 2 lakh from your other income, such as salary or business. The remaining loss of Rs 1 lakh will be carried forward for the next 8 years.
Section 10(14): HRA exemption for rented houses
If you work in a company and live in a rented house, then the House Rent Allowance (HRA) you get can help you save tax. For this, tax exemption is given under Section 10(14) of the Income Tax, but with some rules. The exemption you get is given on the lowest amount out of these 3.
Actual HRA received (as shown in your salary slip)
50 percent of salary in metro cities (Delhi, Mumbai, Kolkata, Chennai) or 40% in non-metro cities
Rent - 10% of basic salary
That is, all these three will be calculated for exemption and the amount which is the lowest will be valid as exemption from tax. If the annual rent is more than Rs 1 lakh, then it is necessary to provide the PAN of the landlord.
Section 80D: Exemption on health insurance
Section 80D of Income Tax is very important, which allows taxpayers to get an exemption on health insurance premiums. Under this, the taxpayer can claim tax exemption of up to ₹ 25,000 for himself, his spouse, and his children. If the parents are senior citizens (60 years or above), then an additional exemption of ₹ 50,000 is available.
In this way, the total maximum exemption can be from Rs 75,000 to Rs 1 lakh. The amount of preventive health checkups up to Rs 5,000 can also be included in this, which is counted in the total limit.
Section 234F: Heavy penalty for filing ITR late
A penalty is imposed under Section 234F for not filing income tax returns on time. If your income is less than Rs 5 lakh, a penalty of Rs 1,000 can be imposed, and if your income is more than Rs 5 lakh, a penalty of Rs 5,000 can be imposed.
Apart from this, repeated delays can also lead to interest and other penalties under sections 234A and 234B. Also, you may lose a refund and carry forward benefits.
Disclaimer: This content has been sourced and edited from Hr Breaking. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.
