Suresh has been paying ₹85,000 income tax every year for the past 4 years. Last month his colleague showed him his tax return — ₹12,000 for the same salary. "How??" Suresh asked. The answer was not a loophole. It was just knowing which forms to fill.
Indian tax law gives salaried employees plenty of legal deductions. Most people miss them because HR sends one confusing email in April and nobody reads it. Here are 10 deductions you should know before March ends.
10 Deductions Salaried Employees Miss
1. Standard Deduction
₹75,000 under new regime, ₹50,000 under old — automatic, no proof needed.
2. Section 80C — PF, ELSS, PPF, Life Insurance
Up to ₹1.5 lakh combined. Your employee PF counts. Add ELSS mutual funds or PPF for the rest.
3. Section 80D — Health Insurance
₹25,000 for self and family. ₹50,000 if covering parents above 60. Buy health insurance — it saves tax AND protects you.
4. HRA Exemption
Paying rent? Submit rent receipts to HR. Exemption depends on basic, rent paid, and city. Bangalore and Mumbai tenants save the most.
5. Home Loan Interest — Section 24(b)
Up to ₹2 lakh interest deduction on self-occupied property. Massive saver for home loan holders.
6. NPS — Section 80CCD(1B)
Additional ₹50,000 beyond 80C limit. Stack this on top of ELSS and PF.
7. Education Loan Interest — Section 80E
No upper limit. Full interest on education loan is deductible for 8 years.
8. Leave Travel Allowance (LTA)
Tax-free twice in a block of 4 years for domestic travel. Save tickets and boarding passes.
9. Food Coupons / Meal Allowance
Some employers offer tax-free meal vouchers up to ₹2,200/month. Ask HR if available.
10. Professional Tax
Deducted from salary and allowed as deduction under old regime. Already on your payslip — make sure it's counted.
Calculate tax savings with our Income Tax Calculator. Generate rent receipts for HRA exemption claim. Calculate SIP returns on your 80C ELSS investments.