Do not forget to claim these deductions beyond Section 80C

Most individuals must file their income tax return for fiscal year 2019-20 by December 31, 2020. When filing your tax return, remember to claim deductions other than the popular 80C section (which is used for investments like PPF, ELSS funds, etc.). The deadline for tax investments for the 2019-20 financial year has been extended to July 31, 2020 due to the Covid-19 pandemic. Listed here are customary deductions other than the tax saving investments such as 5-year FD, PPF and ELSS funds that fall under Section 80C and have a cap of £1.5 lakh.

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Health insurance premiums (Mediclaim)

You can claim a deduction up to £25,000 per year for health insurance premiums according to § 80 D EStG. This includes premiums paid for a policy that covers you, your spouse and children, and includes premiums as well £5,000 for medical examination. If you have senior parents and you pay for these premiums, you can request an additional deduction from £50,000 for it. All in all, you can claim a total deduction from £75,000 under this section and also enjoy the benefits of health insurance

§ 80 G (donations)

If you donated to a charitable foundation, you can apply for a deduction under Section 80G of the Income Tax Act 1961. The deduction can be 100% or 50% of the deposited amount depending on the type of amount deposited to the institution you donated to. For example, the Prime Minister’s National Aid Fund is 100% eligible to donate. For certain categories of institutions, the deduction is limited to 10% of your total adjusted income and the deduction can be 100% or 50% depending on the category of the recipient’s NGO or institution. For example, if you made a donation £50,000 and your total adjusted gross income is £The actual deduction is limited to 4 lakh per year £40,000 (10% of £400,000). Ask the organization you’ve contributed to for an 80G certificate to substantiate your claim.

Section 80 E (interest on educational loans)

Interest on educational loans is deductible under Section 80 E of the Income Tax Act 1961. The loan must be obtained from a bank, financial institution, or recognized non-profit organization. It cannot be taken by family or friends. There is no upper limit for the deduction. However, the deduction can be made for a maximum of 8 years from the date of repayment of the loan. You should receive a statement from your bank showing the breakdown of the principal repayment and the interest on the loan.

§ 80 DDB (medical treatment)

This is a deduction from the cost of treating dependent family members for diseases such as malignant cancer, AIDS, and kidney and neurological disorders. The upper limit for this deduction is £40,000, that goes to £100,000 for seniors. “Taxpayers often forget to claim the § 80 DDB allowance for the medical treatment of dependent family members. They do not need a certificate of treatment from a state hospital. A certificate from a private doctor, but the respective specialty, is sufficient,” said Prakash Hegde, one Bengaluru based Chartered Accountant. The deduction can be claimed for the treatment of self, spouse, parent, child or sibling.

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