Government allows deduction under the above sections.The maximum deduction under above sections is Rs 150000, by investing in investments as in sections above tax can be saved.There are instruments provided by government and by investing in such places will help in tax saving.
2) Tax saving u/s 80D, 80DD, 80DDB
Income tax can be made if we have invested in insurance premiums for own health and our relatives as specified in the Act.Deduction can be claimed after investing in different type of instruments.
3) Tax planning by home loan
If home loan is taken then deduction of the principle can be claimed u/s 80C. Interest on home loan can be claimed up to Rs 2,00,000.
4) Tax Planning u/s 80E
The deduction of interest of loan taken for amount taken as loan for higher education of self, spouse and children can be claimed. Tax can be saved by using this deduction and only interest amount without any limit can be claimed it is not applicable for principal amount. This is not available for HUF.
5) Tax planning u/s 80CCG: RGESS
If the income of a person is less than Rs 12,00,000 then deduction can be claimed if investment is made in specified shares and mutual funds.It is called as Rajiv Gandhi Equity Scheme and it is available for first time investors investing in mutual fund scheme.
6) Long term capital gains
If there is any long term capital gain arising by sale of long term capital asset the benefit of saving tax on such gain can be claimed by investing the amount of sale received in instruments as specified u/s 54 of income tax act. The long term capital asset is one which is held for a period of more than 3 years till
last year. For current period it will be 2 years.
7)Deduction u/s 80G
Tax can be saved by making donations under this section in areas specified in some cases 100% deduction is available and in some cases 50% deduction is available. The mode of payment if in excess of Rs 10,000 is cheque but for less than Rs 10,000 cash can be paid.
8) Long term capital gain on sale of shares of a company
If shares are held for a period of more than one year then sale of such shares long term capital gain arising is exempt.