The financial year 2024-25 is going to end very soon. The new financial year 2025-26 will start from April 1, 2025. So if you have not done tax saving yet, you have time till March 31, 2025.
Many taxpayers still choose the old income tax system to pay tax. Under the old income tax system, you can avail tax deduction of up to Rs 1.5 lakh under section 80C. At the same time, under the new income tax system, only a few tax deductions are available.
Section 80C is considered to be very popular among taxpayers in relation to tax savings or deductions. Many people take advantage of this section while paying tax.
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Benefits are available on these schemes under section 80C
Under the old income tax regime, taxpayers can claim a tax deduction of up to Rs 1.5 lakh. This section applies to individual taxpayers and Hindu Undivided Families.
It is important to make smart investments for tax savings. Under Section 80C, you can save tax by investing in various schemes. These include PPF, ELSS, Sukanya Samriddhi Yojana, and Senior Citizen Savings Scheme. By investing in these schemes, you can not only save tax but also get good returns.
What is Section 80C
To understand Section 80C, it is important to know about Section 80CCC and Section 80CCD.
Section 80CCC: Under Section 80CCC, tax deduction can be claimed through pension plans of LIC or any insurance company. To claim tax deduction, it is mandatory for the scheme to be a pension provider.
Section 80CCD (1): Section 80CCD gives the right to claim tax deductions under the Central Government Pension Scheme. If you invest 10% of your salary in pension, then a tax deduction can be claimed. Under this section, you can avail tax deduction of up to Rs 1.5 lakh.
Section 80CCD(1B): Under this section, you can avail tax deduction of up to Rs 50,000 by investing money in an NPS account. Along with this, 60% of the maturity amount received as a lump sum under NPS is tax-free. However, a monthly annuity is considered an income tax guarantee.
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