Jagran Dialogues: How to Save Income Tax efficiently- Watch Video

Here is a look at some of the ways one can save income tax and improve one's overall financial fitness.


Investment in tax-saving instruments

• Employees' Provident Fund (EPF)
• Public Provident Fund (PPF)
• Fixed deposits (tenure of 5 years or more)
• Life insurance policies
• ELSS mutual funds

Selection of appropriate components in the salary structure o
one can evaluate the salary structure offered by the employer and opt for those salary components which help maximise tax benefits.


Increase in retirement fund contribution
Salaried individuals can look at making additional contributions towards the 'Voluntary Provident Fund' in addition to EPF, if the investment limit of Rs 1.5 lakh is not exhausted. This additional contribution will also be deductible from taxable income subject to conditions. Further, the employer's contribution to NPS (subject to 10% of salary) will provide an additional deduction to the employee.
Home Loan
If a housing loan is availed from a financial institution such as a bank or NBFC or housing finance company to acquire/ construct a house property, then the interest and principal paid on the loan taken can be claimed as a deduction from taxable income, subject to specified limits under the tax provisions.

Health Insurance

Income tax provisions provide for deductions against premiums paid towards health insurance for self, spouse, dependent children and dependent parents. Hence, one can buy health insurance for oneself and family members to help manage medical expenses in case of health emergencies and at the same time, avail of tax benefits for a premium paid towards these policies