Here’s a look at some lesser-known tax deductions available to taxpayers under various sections of the Income Tax Act 1961.
Under Section 80C
Apart from the deduction on principal repayment on home loan under Section 80C, taxpayers can also claim the stamp duty paid on property purchase.
Under the same section, taxpayers often miss out on claiming deduction on reinvested interest on National Savings Certificate (NSC). Interest on NSC is not paid every year and gets reinvested. Taxpayers can claim this deduction on the reinvested interest.
Preventive medical tests
Only a few taxpayers claim deduction on expenditure on preventive health check-ups. “One can avail up to Rs 5,000 on preventive check-up for self, dependent children, spouse or parents below 60 years of age under Section 80D,” Mint quoted Karan Batra, founder of charteredclub.com, as saying.
For parents who are 60 years or above, taxpayers can claim Rs 7,000 under preventive health check-up. Medical tests undertaken to detect any possible diseases are included as preventive health check-up.
Medical expenses of parents
Taxpayers who pay medical bills for parents aged 60 years or above who are not covered by a medical insurance policy can claim deduction for the same. Under Section 80D, taxpayers can claim a deduction up to Rs 50,000 on medical expenses.
However, these expenses can only be claimed if they are paid in any mode other than cash. Those who have to pay in cash due to unavoidable circumstances can still claim a deduction if they can justify why they paid through the cash mode.
Education loan interest payment
Taxpayers are allowed to claim tax deduction on the amount of interest paid on loan taken for higher studies for self, children or spouse under Section 80E. There is no upper limit on the amount of deduction under this section.