Tax Planning for Salaried Individual for FY 2015-16 to Save Taxes

Tax Planning for Salaried Individual 5 Tax Saving Strategies

Tax Planning for Salaried Individual

There are no. of ways being within the purview of the Indian income tax act for salaried individual to save taxes.
Lets discuss few of the most popular strategies for FY 2015-16 to save taxes

5 Tax Planning Strategies 
Save Tax u/s. 80C, u/s. 80CCC and u/s. 80CCD
Save Tax u/s. 80D – Mediclaim Policy
Save Tax u/s. 80DD and u/s. 80DDB
Tax Planning through Home Loan
Tax Planning through RGESS: u/s. 80CCG
U/s. 80 C, U/s. 80CCC and U/s. 80 CCD
An individual can invest in an instrument as specified U/s. 80 C, U/s. 80CCC and U/s. 80 CCD
Maximum Combined deduction allowed under these section is Rs.150000
An additional investment of Rs.50000 over and above this limit is allowed, if an individual invest in NPS
In total, an individual can claim Rs.200000 under these 3 section 
Most popular investment choices u/s. 80C is
Equity Linked Savings Scheme (ELSS)
Life Insurance Policies
Public Provident Fund
5 year tax saving Bank FD
National Savings Scheme (NSC)
u/s 80CCC one can invest in a pension policy of an insurance company
u/s 80CCD an individual can invest in National Pension Scheme (NPS) 
Sec 80 D:   
u/s. 80D, An individual is allowed claim deduction on expenditure if a premium is paid towards mediclaim policy for self & family and mediclaim policy for parents. 
u/s. 80DD Deduction is available on
Expenditure incurred on medical treatment, training and rehabilitation of handicapped dependent relative
Payment or deposit to specified scheme for maintenance of dependent handicapped relative.
u/s. 80DD medical expenditure can be claimed
Where disability is 40% or more but less than 80% – fixed deduction of Rs 75,000
Where there is severe disability (disability is 80% or more) – fixed deduction of Rs 1,25,000.
u/s. 80DDB Deduction is available on
 Expenditure actually incurred by individual on himself or dependent relative for medical treatment of specified disease or ailment
u/s. 80DD Amount of deduction will be lower of amount actually paid on medical treatment or
Individual <60 of Age – Rs.40000
Individual >60  but <80 Age – Rs.60000
Individual >80 Age – Rs.80000
Tax Savings on Home Loan
Indian income tax law gives opportunity to individual investor to build wealth in the form of residential house
An individual can  leverages tax while building his own home
Buying House property on a home loan could cut down your tax bill significantly
As per Indian tax law, an individual is allowed to claim maximum deduction of Rs. 
2,00,000 p.a. against interest component of your Housing loan 
1,50,000 p.a. of principle paid for the housing loan against u/s. 80C
Tax Planning through 80CCG – RGESS
Under Rajiv Gandhi Equity Saving Scheme (RGESS) you are allowed to invest in direct equity share or eligible MF scheme.
Investors whose gross total income is less than Rs. 12 lakhs p.a. can invest in this scheme
For first time investor in the equity market
Deduction is lower of 
50% of amount invested in equity shares or
Rs 25,000

Leave a Comment