Top Benefits of e-Filing Income Tax Returns on Time in India
The following documents are important and should be compiled by the taxpayer to avoid last-minute hassle:
Home Loan statement from Bank
The statement becomes important so that you can claim a deduction for the principal amount repaid during the year u/s 80C for a maximum of Rs.1.5 lakhs. Deduction on interest can also be claimed up to Rs.2 lakhs in case your house property is self-occupied. In case of let out house property, a loss can be claimed up to 2,00,000 and the remaining loss can be carried forward to the succeeding 8 Assessment Years Interest deduction is allowed on a due basis i.e., whether paid or payable during the year. Section 80EE and 80EEA gives the additional benefit of interest paid, to the first time home buyers subject to certain conditions.
School fee receipt for tuition fees
Fee receipt shows up a break up of tuition fees paid and the amount charged for other activities. The tuition fee component is allowed as a deduction under section 80C of the Income Tax Act for a maximum of two children. You should have these details to claim deduction under these sections while filing ITR.
Contribution to PPF, Life Insurance Premium Receipts
The major tax saving instruments used in India include contributions made to PPF, investments in LIC, 5 Year tax saving FD etc. Amount invested in all such tax saving funds is eligible for deduction under section 80C, aggregating to a maximum deduction of Rs.1.5 lakhs. If you have made any such contribution, it is imperative that you furnish documents related to the same.
Investment in NPS
Amount invested in NPS deduction subject to a ceiling of Rs. 1.5 lakhs and Rs 50,000 is allowed under section 80CCD and 80CCD (1B), respectively. So if you have exhausted your 80C limits and desire to save more taxes by investing your money, you can choose NPS.
Donations made to the institutions that qualify for deduction @ 50% or 100% u/s 80G will be required. The donation shall be made via any mode other than cash if the amount donated exceeds Rs 2000 from FY 2017-18 onwards.
Details of Medical Insurance
Section 80D gives you a deduction from your gross total income for the amount paid as medical policy premiums. The policy can be taken for self, spouse, children and parents. If the member insured is a senior citizen- the amount eligible for deduction u/s 80D will be Rs. 50,000 for F.Y. 2020-21 and in all other cases it will be restricted to Rs 25,000 per year. For senior citizens, the deduction is also available for medical expenditure up to Rs 50,000. 80D is provided separately for parents and self, spouse and dependent children.
If you are paying interest for an education loan taken for higher studies of yourself, spouse or children; you can claim deduction under section 80E without any limit subject to the actual interest paid from the first year scheduled for repayment to a total of 8 years.
Receipts of any other investments
The taxpayers need to collect the receipts of other investments if any