The last date to save tax for the financial year 2021-22 is 31 March 2022. You have a little over three months to complete your tax planning process for the assessment year 2022-23. If you have not taken such tax saving measures, then you should act on it immediately.
Many people would think that even if tax saving measures are taken, then Rs 1-2 lakh will be tax exempt. But it is not so. If you plan properly and take advantage of every exemption carefully, then you can avoid paying zero tax even on a salary of Rs 10 lakh. know how.
How to start
Here we will tell the method of zero tax on income above Rs 10 lakh to a person below 60 years of age. If it is assumed that the total salary of such a person every year is Rs 10.50 lakh, then it will come in the tax slab of 30 percent.
Now first of all he will get a standard discount of Rs 50,000. Out of Rs.10.50 lakh, Rs.10 lakh is left after Rs.50 thousand.
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Then take advantage of 80C
You can avail the benefit of section 80C on salary of Rs 10 lakh. You will save up to Rs 1.5 lakh from this. One can avail tax exemption on this amount by investing in EPF, PPF, ELSS, NSC and spending up to Rs 1.5 lakh every year as tuition fee for two children. In this way, out of Rs.10 lakh, Rs.1.5 lakh was lost, the remaining Rs.8.5 lakh.
Help from National Pension System
Next help you will get from National Pension System. In this, a deduction of Rs 50,000 is available under section 80 CCD other than section 80C. If you invest Rs 50000 in it every year, then this entire amount will be eligible for exemption.
That is, out of Rs 8.5 lakh, 50 thousand rupees were further reduced. 8 lakh left now. Out of this, one can also claim tax exemption under section 24B of Income Tax for interest of Rs 2 lakh. Now Rs 6 lakh.
Insurance and health check up
There are more special exemptions under section 80D of Income Tax. This exemption is available on preventive healthcare check-ups for spouse or children and yourself. With this, you can claim deduction up to Rs 25,000 including health insurance premium.
There is a further discount of up to Rs 50,000 on health insurance premium for parents. But your parents must be senior citizens. Rs.75000 out of Rs.6 lakhs and less left is Rs.5.25 lakhs.
Discount on donation
You can claim tax exemption on this amount by donating Rs.25,000/-. But keep in mind that there should be solid proof of this. Keep documents for this. That is, take a receipt with the stamp of where you have donated. 5 lakh left.
It will be taxed at Rs 12,500 at the rate of 2.5 per cent. But the same discount is also available. This is how zero tax happened.