There’s much more to deductions than 80C
There’s much more to deductions than 80C
The most popular deduction is the Rs1 lakh knock out under section 80C. But there are six other deductions under section 80 that you may need to use to reduce your taxable income. And, of course, using your home loan as a tax deduction tool is always a great idea. Not only do you get a deduction of up to Rs1 lakh under the 80C umbrella on the principal, but the interest up to Rs1.5 lakh is tax deductable too. If you rent the house out, the entire interest is a deduction.
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80D
Tip: Cash payments don’t work. You need to pay by cheque to get the deduction.
80DD
Tip: You need to submit a medical certificate (issued by a specified medical authority) with your tax return.
80E
Tip: Remember, the loan should be from the “approved" list of charitable institutions or a notified financial institution.
80G
Even charity gets your money back. Depending on who you give to, half or the entire donation can become a deduction from your income.
Tip: You need a receipt from the eligible institution to get this deduction.
80GG
• Rs2,000 per month, or
• 25% of your total income, or
• Excess of rent paid over 10% of total income
Tip: Remember that you will need receipts to go with the return to get this deduction.
80U
Tip: You can’t claim under this if you have already used section 80DD.
80C and 24(B)
Your home on loan: the biggest deduction of them all
An additional Rs1.5 lakh each can be claimed by your spouse and you on the interest due on the loan, if you live in the house. Already, on a joint loan and property, the deductions are at Rs5 lakh. It gets even better if the house you own is on a loan and is rented out. The entire interest due on the loan becomes a deductible expense for you and your spouse.
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