Question: How Can I Save My Income Tax 2020 21?

Is there any standard deduction for FY 2020 21?

Therefore, the taxpayer can claim a standard deduction of Rs.

40,000* or the amount of pension, whichever is less.

*Increased to Rs 50,000 for FY 2019-2020(AY 2020-21) through the Interim Budget 2019..

How can I save my maximum income tax?

Recommended ways of saving taxes under Sec 80C & 80DMake investment of Rs 1.5 lakh under Sec 80C to reduce your taxable income.Buy Medical Insurance & claim a deduction up to Rs. … Claim deduction upto Rs 50,000 on Home Loan Interest under Section 80EE.

How can I save my income tax without investment?

Here are a few ways in which taxpayers can save tax, without investing in new instruments for FY 2020-21.Children’s Tuition Fees and Hostel Allowance. … Deduction for Interest Paid on Home Loans. … House Rent Allowance. … Employees’ Provident Fund (EPF) … Education Loan. … Standard Deduction on Employee’s Salary. … Conclusion.

What is the lowest income tax bracket?

10 percentTax code overhaul changed brackets, deductions The tax code has seven income/tax brackets, with the lowest tax rate being 10 percent. The highest earners pay 37 percent.

How can I save my income tax FY 2019 20?

Equity-linked savings schemes or ELSS offer tax deduction under section 80C of the Income Tax Act, for investments up to Rs 1.5 lakh in a financial year. You can invest via the SIP route or put in a lump sum amount. Click here to read more about ELSS.

What is the income tax slab for 2020 21?

INCOME SLAB AND TAX RATES FOR F.Y. 2020-21/A.Y 2021-22Taxable incomeTax Rate (Existing Scheme)Tax Rate (New Scheme)Rs. 7,50,001 to Rs. 10,00,00020%15%Rs. 10,00,001 to Rs. 12,50,00030%20%Rs. 12,50,001 to Rs. 15,00,00030%25%Above Rs. 15,00,00030%30%3 more rows

What is the 80c limit for 2020 21?

The maximum deductions available under a few sections are as follows: Section 80C to 80CCC: ₹ 1,50,000. Section 80CCD: ₹ 50,000. Section 80D: ₹ 30,000 for self, spouse and children, ₹30,000 for parents, ₹50,000 for senior citizens.

How can I save tax this year?

1. Section 80CEquity Linked Savings Scheme: Equity Linked Savings Schemes are a type of mutual funds with a lock-in period of three years. … Senior Citizen Savings Scheme: … National Pension System: … Term Life insurance premium: … Public Provident Fund: … National Savings Certificates: … Tax-saving FDs: … Home loan repayment:More items…

What are the sections to save tax?

In this article, let’s take a look at the tax-saving options other than Section 80C to turn you into a smart tax saver.Section 80CCD: National Pension Scheme. … Section 80D: Payment of health insurance premium. … Section 80E: Repayment of an education loan. … Section 24: Interest payment of a home loan.More items…•

How much is the 2020 standard deduction?

2020 Standard Deduction Amounts $12,400 for single taxpayers. $12,400 for married taxpayers filing separately. $18,650 for heads of households. $24,800 for married taxpayers filing jointly.

What is the formula to calculate taxable income?

Your Adjusted Gross Income (AGI) is then calculated by subtracting the adjustments from your total income. Your AGI is the next step in figuring out your taxable income. You then subtract certain deductions from your AGI. The resulting amount is taxable income on which your taxes are calculated.