Smart Ways to Save Tax in FY 2024-25

Your tax filing deadline for the financial year 2024-25 might be months away. But if you want to step up your tax planning in 2024, it’s time to start identifying tax-saving options. Doing this allows you to strategize your financial planning in a way that reduces your tax liability considerably. And we make this a breeze by giving you a quick checklist.  

Here are four smart tax saving options that allow you to increase your disposable income and increase your savings with ease.

1. Maximise the application of Section 80C

A smart way to save tax in 2024, is by stretching the effect of Section 80 of the Income Tax Act 1961 to its limit. This powerful provision allows you to scale your disposable income considerably by allowing tax deductions of up to Rs 1.5 Lakh. However, it's applicable to select tax-saving investments, such as,

• Employee Provident Fund (EPF)
• Public Provident Fund (PPF)
• Equity Linked Saving Scheme (ELSS)
• Senior Citizen Saving Scheme
• Sukanya Samriddhi Yojana

2. Take out a health insurance policy

Given the rising pollution levels and medical costs, coupled with the fast-paced life we lead, it's important to have a health insurance policy in today’s day and age. And the best part is that these policies don’t just cover your medical bills, but also offer a significant tax-saving option. 

Section 80D of the Income Tax Act 1961 allows you to claim tax deductions of up to Rs 1 Lakh on your health insurance policy premiums. 

3. Utilise a home loan for its tax-saving benefit

Home loan repayment is another great avenue to save tax in 2024. Under Section 80 of the Income Tax Act 1961, you can claim tax deductions of up to Rs 1.5 Lakhs on the repayment of the principal amount. 

Under Section 24 of the act, you can claim a maximum of Rs 2 Lakhs on home loan interest repayment. So, if you’re planning on applying for a home loan, or already have one underway, this can be a great tax-saving option for you. 

4. Choose the right tax regime

Being aware of the new and old tax regimes allows you to have a balanced and informed view of how best to save taxes. The Union Budget 2023-24 introduced a new regime that lowered tax rates for higher income levels. But while a new regime had been introduced, the old regime was also applicable. 

It's best to examine both regimes applicable in the FY 2024-25 to identify which one helps you save big on taxes. 

Parting thoughts

If you’re looking to up your financial game to save tax in 2024, the above four ways are a great place to start. By incorporating them into your 2024 financial plan, you can optimise your financial portfolio while also decreasing the tax burden.

But it doesn’t end there. To truly benefit from the above tax-saving schemes, you need a reliable platform to help you execute them smoothly. And the best platform for the job is Tata Capital’s Moneyfy. Whether you’re looking to invest, take out an insurance policy or apply for a loan, this convenient and user-friendly platform is all you need. 

To know more, visit the MoneyFy website or download the MoneyFy app today!