Updated 08th April 2014  It is quite obvious that the exemptions under section 80C are most stressed upon by individuals more so by salaried individuals as tax planning tools considering that one can avail a maximum exemption upto Rs. 100,000 from the taxable income. But, for individuals whose gross total income exceeds Rs.260,000 (Rs.160,000 as basic exemption and Rs. 100,000 for 80C) in a tax year, deductions under Section 80C may not be sufficient to reduce the overall tax liability and thus a need arises to look beyond provisions of Section 80C to minimize tax outgo: 1.  Health Insurance Premium (Section 80D) An individual can claim a deduction of Rs.15,000 (Rs.20,000 in case of senior citizens) for medical or health insurance, and are also called medi-claim policies. Premium paid on the health insurance of self, spouse and dependent children falls into this exemption basket. Further, in addition to above deduction of Rs. 15,000 is allowed on a similar policy for your parents (Rs. 20,000 if either of your parent is a senior citizen) irrespective of whether they are dependent on you or not. Another interesting thing to note here is that, part payment of premium is eligible for deduction. Suppose for an example, suppose your parents buy a health insurance policy having an annual premium of Rs. 14,000. Of the full premium, if your parents pay only Rs. 5,000 and the balance of Rs. 9,000 is paid by you, you will be allowed a tax deduction of Rs. 9,000 and while your parents will be allowed a deduction of Rs. 5,000. 2. Educational Loan (Section 80E) An individual is allowed a deduction for only the interest component of a loan taken towards higher studies from any bank, financial institution, or approved charitable institution. Such a loan for pursuing higher education is enlarged to cover all fields of study including vocational studies after passing senior secondary examinations as well as full time studies including graduation of specified courses such as management, engineering and medicine for self or any of family members (children, spouse). Remember, there is no deduction allowed for principal repayment of an education loan. 3. Home Loan (Section 24) Individuals who have bought/constructed a house can seek deductions on interest payments on home loans upto Rs. 150,000. Principal component can be tax exempted under section 80C. If your home loan amount is a substantial sum, then the interest and principal repayment in the form of EMIs may exceed the stated limit. To ensure the tax benefit is optimally utilised, an individual can consider opting for a joint loan with his spouse or parent or sibling. This will ensure that both the co-owners can claim tax deductions in the proportion of their holding in the loan. The co-owner falling in the higher tax bracket should hold a higher proportion of home loan to ensure that the tax benefits are maximised. 4. Deduction u/s 80TTA: Interest from savings bank account is taxable, even though there is no tax deduction at source (TDS). But since 2012-13 under Section 80TTA  interest up to Rs10,000 in one financial year is exempt from tax. 5. Deduction u/s 80CCG: Section 80CCG of the Income-tax Act is also called as Rajiv Gandhi Equity Savings Scheme, 2012 (RGESS). Any resident individual with income less than Rs 12 lakhs who uses demat account for the first time to buy notified shares, mutual funds or ETFs can claim 50% deduction on the invested amount. RGESS was introduced to encourage small investors to participate in the equity markets. Conditions to be satisfied to avail the deduction u/s 80CCG are as follows – a. Should be a new retail investor. This means you should be using a demat account the first time ever for equities. You should be using a new demat account or if you had a demat account you should have never traded in equities using it before. b. Your income should not exceed Rs 12 lakhs. c. Investment must be done in – (i) Shares belonging to BSE-100, NSE-100, maharatnas, navratnas or miniratnas. FPOs of these companies or IPOs of PSUs with 51% government shareholding are also eligible. (ii) Mutual funds and ETFs investing in the above shares are eligible for tax saving through RGESS. NFOs of such funds are also eligible for 80 CCG RGESS deduction. d. NRIs cannot avail this tax benefit. RGESS tax rebate under section 80CCG is applicable only for residents. 6. Deduction u/s 80EE: Benefit of this section can avail by Individual assessee. Deduction under this section is not available for any other assessee (like HUF, firm etc.). Individual can claim benefit under this section only when all the following conditions are satisfied, these are-

• Purchaser should be first time buyer. i.e. he has never purchased any house and now he is going to purchase a house.
• Value of the house should not more than 40 lakh.
• Loan taken by Individual for the purpose of buy a house should not be more than 25 lakh.
• On the date of sanction of loan individual does not have any own residential house property.
• Loan for this purpose taken by individual should be from the Financial Institution or Housing Finance Company.
• For this purpose, loan should be sanctioned between 01.04.13 to 31.03.14.

Quantum of Deduction u/s 80EE: Assessee can take deduction u/s 80EE on interest payable on home loan upto 1 Lakh in A.Y.2014-15. It can claim deduction in two assessments year. Means if whole amount of interest payable upto 1 lakh is not claim as deduction in A.Y.2014-15 then remaining balance amount upto 1 lakh can claim in A.Y.2015-16.Total deduction under this section shall not be more than 1 lakh. Apart from those mentioned above there are provisions for exemptions on donations towards various approved charities, relief funds, NGOs, etc., Also, such deductions are allowed on treatment of severe illness, special exemptions for physically challenge. We at www.taxmantra.com provide full year support solving all your tax issues, in addition to filing of your return of income with excellent tax planning. Please check this to file your income tax return filing.