How to Save Tax on 8 Lakhs Salary?

Hi there. I can help you with how to save tax on 8 lakhs salary. I fall under the same income bracket and took help from my CA to understand ways to save tax. Let me share those below.

If My Salary is 8 Lakhs How to Save Tax?

Here is how you can save taxes on an income of Rs. 8 lakhs under the new regime:

• Standard deductions of Rs. 50,000 for salaried employees.

• Section 80 CCH - Investment made in Agniveer Corpus.

• Section 57(iia) - Family Pension received.

• Interest on Home Loan on the let-out property (Section 24)

• Exemption on voluntary retirement 10(10C), gratuity u/s 10(10) and Leave encashment u/s 10(10AA).

• Any type of compensation to meet the travelling cost on tour or transfer.

• Conveyance allowance received to meet the conveyance expenditure incurred as part of the employment. 

• Section 80CCD(2) - Employer contribution to NPS.

• Transport allowances in case of a specially-abled person. 

• The tax rebate limit under Section 87A has been increased. Previously, it was Rs. 12,500 for income up to Rs. 5 lakhs, and now, it has been increased to Rs. 25,000 if your taxable income is less than Rs. 7 lakhs. 

Below, you can find ways regarding how to save tax on salary income of 8 lakhs under the old regime:

1. Section 80C: Exemption up to Rs. 1.5 lakhs per annum on investments made in mutual funds, ULIPs, pension funds, government savings schemes, home loan principal amount, life insurance premiums, education fees, and more.

2. Section 80D: Deduction on health insurance premium payments towards self or parents.

3. Section 80TTA: Deduction on savings account interest.

4. Section 80CCD: Additional tax exemption of Rs. 50,000 on investing in the National Pension Scheme (NPS).

5. Section 10: Exemption on HRA, relocation allowance, leave travel allowance, and mobile reimbursement

6. 80G: Deduction on donations to charitable organisations.

7. Professional Tax Deduction under Section 16 

This is how to save tax on 8 lakhs salary.