Income Tax Savings 2022: If planned properly, salaried people can earn a lot of money from the various tax saving opportunities.
2022 income tax savings: If planned well, wage earners can save a lot of money through the various avenues available to save tax under income tax rules. While most taxpayers are familiar with popular options such as tax-saving fixed deposit, PPF, provident funds, HRA, home loan interest deduction, there are several less popular ways , or rather rare, available. Discover five of them:
1. Redirect investment to parents of elderly people
In accordance with income tax rules, seniors enjoy several tax benefits. According to tax2win, you can gift money to your parents tax-free. Thereafter, your parents can reinvest this money in various senior-friendly schemes, such as Senior Fixed Deposit, Senior Savings Plan, and more.
You can use this option to redirect your investment income. However, your parents should have a low income. Otherwise, they will end up paying taxes. For example, if you earn Rs 50,000 in investment interest, this amount can be transferred to your parents tax-free.
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2. Increase the contribution to the national pension system
An NPS subscriber is eligible for an additional deduction of Rs 50,000 under Section 80CCD(1B) during a financial year. This deduction is greater than the deduction of Rs 1.5 lakh allowed under Section 80C of the Income Tax Act.
3. Save tax on phone and internet expenses
Reimbursement for telephone provided to employees is not taxable under Rule 3(7)(ix) of the Income Tax Rules. This way you can save tax on mobile/telephone and internet expenses if your job requires the use of these facilities. However, you will need to submit original invoices to your employer to take advantage of this tax saving facility.
4. Save tax on parent health payments and health insurance premium
Under Section 80D, taxpayers are allowed to claim a deduction of up to Rs 25,000 against the payment of health insurance premium for self and family. An additional deduction under this section is permitted. If you pay a medical insurance premium for parents, you can claim an additional tax deduction of 80D.
If the parents are under 60, a deduction of up to Rs 25,000 can be claimed.
If the parents are over 60 and above, a deduction of up to Rs 50,000 can be claimed.
Additionally, you can claim a deduction of up to Rs 50,000 for medical expenses incurred during the year if your parents are elderly and not covered by any health insurance policy.
5. Save tax on charity/donations
You can claim a deduction for charitable donations. Some donations are eligible for a deduction of up to 100%, while others are eligible for a deduction of 50%. According to tax2win, only donations made in cash (up to Rs 2000) or by check are eligible for tax deduction.
You should consult your tax advisor to explore the above and other uncommon ways to save tax.