- By Priyanka Payal
- Fri, 19 May 2023 05:31 PM (IST)
- Source:JND
TAX SAVING tips: ‘A penny saved is a penny earned,‘ this old saying is completely true when it comes to building your wealth by saving taxes. In India, government levies taxes on income, wealth, property, etc, and you can maximize your wealth if you know how to save taxes under all these categories and that too legally. It is often seen that people either take the help of tax consultants or Chartered Accountants to save themselves from paying hefty taxes. The income tax act provides certain deductions for various investments, savings and expenditures that can help you save taxes.
If you are someone who earns Rs. 15 Lakh as your annual salary and wants to save taxes, this article is for you. In this article, we will discuss a few tax-saving tactics that can help taxpayers falling in the Rs. 12,00,001 to 15,00,000 income tax slab, to save money.
How To Save Tax On 15 Lakhs Salary?
Take a home loan and enjoy tax deductions under Section 80C
The Indian government runs certain schemes and programmes like Pradhan Mantri Awas Yojana and DDR Delhi Development Authority Housing Scheme to make housing more accessible in India. While Sections 80C and 24(b) minimize monetary liability by reducing your tax burdens.
A deduction of Rs 1.5 lakh can be claimed under section 80C for the repayment of the principal of a home loan opted for buying a house or construction of a new house only.
Section 24(b) allows for a tax deduction on the interest portion of a house loan up to Rs 2 lakh annually. Furthermore, if you rent out the newly bought home, the entire interest component is exempt from annual income tax calculations.
Section 80EEA also allows you to claim an extra reduction in your annual tax liability when you are a first-time homeowner.
Buy a health insurance policy
Under section 80D, Taxpayers can claim tax deductions for the portion of their annual taxable income spent on premium payments. Depending on the age of the covered, different sums are exempt from such income tax calculations.
Invest in tax-saving instruments
Investing in tax-saving instruments is one of the best ways to bring down your taxable income. Some of the popular tax-saving options include Equity-Linked Savings Schemes (ELSS), Public Provident Funds (PPF), Sukanya Samriddhi Yojana, National Pension System (NPS), and 5-year bank fixed deposits.
Go for the new tax regime
The newly introduced new tax regime offers lower tax rates and removes the need for claiming deductions and exemptions. If you are someone who is not claiming too many deductions, you can opt for the new tax regime to save money on taxes.
Under the new tax regime, depending on the income slab an individual can claim tax rates of 5%, 10%, 15%, 20%, and 30%. However, you won't be eligible to claim deductions under Section 80C, Section 80D, and other sections of the Income Tax Act. However, it is always advisable to carefully evaluate your tax liability under both the old as well as new tax regimes before reaching any final decision.
Claim HRA exemption
House Rent Allowance (HRA) is an exemption in the IT Act that can help reduce taxes – partially or completely. If your House Rent Allowance (HRA) is part of your salary, you can ask for a tax benefit for the money you are paying in rent. The exemption amount is determined on the basis of actual rent paid, HRA received, and the location of the rented accommodation.
HRA Calculation in Salary
You can claim an exemption for the lowest of the below-mentioned amounts:
1. The actual rent paid minus 10% of your basic salary.
2. The actual amount of HRA given to you.
3. 50% of your basic salary (for a metropolitan city).
The minimum figure of these three is the HRA you can claim for tax deductions.
By claiming an HRA exemption, you can reduce your taxable income and save money on taxes.
How much tax does a taxpayer pay on 15 lakhs?
As per the latest tax slabs under the new regime, individuals earning Rs 9-12 lakh annually will pay 15% tax, while those earning Rs 12-15 lakh per year will pay 20% tax. The tax rate for individuals earning above Rs 15 lakh will pay 30% tax.