The Indian Income Tax Act, 1961 is the primary legislation governing taxation in India. It provides for all aspects of taxation, from levy and assessment to collection and recovery of taxes. Every financial year, changes in the Income Tax Act are notified and implemented by the government, for the purpose of making the tax system more efficient and equitable. The financial year of 2023–24 is no different. The government has made several changes to the Income Tax Act in order to reduce the tax burden on individuals and businesses. Here, we will discuss some of the key changes that have been made to the Income Tax Act in order to reduce your personal income tax in India A.Y. 2023–24. With the A.Y. 2023–24 fast approaching, taxpayers are looking for ways to reduce their personal income tax burden and make the most of their hard–earned money. Here are some tips on how to reduce your personal income tax in India A.Y. 2023–24:
1. Invest in tax-saving instruments: Tax-saving instruments such as Equity-Linked Savings Schemes (ELSS), National Pension System (NPS), Senior Citizen Savings Scheme (SCSS) and so on, can help you save tax. You can invest up to Rs 1.5 lakh in these instruments and avail tax deductions.
2. Make use of deductions available under the Income Tax Act: There are a number of deductions available under the Income Tax Act, 1961. These deductions help to reduce taxable income and thereby help in reducing tax liability. Some of the deductions available are tax deductions under Section 80C, Section 80D, Section 80E and Section 80G.
3. Opt for the new tax slab rates: Taxpayers can opt to pay taxes as per the new tax slabs introduced in the Union Budget 2020. This will help to reduce their tax liability.
4. Claim benefits under the House Rent Allowance (HRA): Taxpayers can claim deductions under the House Rent Allowance (HRA) provided they are paying rent for the accommodation they are living in.
5. Take advantage of tax exemptions available to senior citizens: Senior citizens are eligible for certain tax exemptions. They can claim tax benefits on their income from interest, dividends and long term capital gains.
6. Avail Home Loan Deduction: Availing a home loan allows you to deduct up to Rs. 2 lakh from your total taxable income under Section 24 of the Income Tax Act.
7. Claim Deduction for Education Expenses: Under Section 80E of the Income Tax Act 1961, you can claim a deduction for any education expenses paid for yourself, your spouse, your children, or for a student for whom you are the legal guardian. This deduction can be claimed for any sum paid for the purpose of their higher education, including tuition fees, examination fees, and other related expenses.
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Disclaimer : “Neither this article nor the information contained herein shall in any way be construed as forming a contract or shall constitute professional advice required before acting upon any matter. CA Sharad Kumar Sharma has taken all due care in the preparation of this article for accuracy in its contents at the time of publication. However, no liability shall be accepted by him in the event of any direct, indirect or consequential damages arising out of or in any way connected with the use of this article or its contents. “
Author Bio
Check the deduction u/s80E which speaks about interest on loan taken for higher education whereas you have mentioned education expenses. It is not clear about interest. Hence, need modification.