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How to Save Income Tax in India

Income Tax Slab Rates in India

Taxable income

Income Tax Rates

Up to ₹2.5 Lakh

Nil

₹2.5 Lakh – ₹5 Lakh

5% of total income exceeding ₹2.5 Lakh

₹5 Lakh – ₹10 Lakh

20% of total income over and above ₹5 Lakh + ₹12,500)

Above ₹10 Lakh

30% of the total income over and above ₹10 Lakh + ₹1,12,500)

An additional health and education cess at 4% of the total tax payable is levied. A surcharge of 10% of the total income also has to be paid by people earning higher than ₹50 Lakh annually. Such cess rises to 15% when the income is higher than ₹1 Crore. 

Even though such rates might seem overwhelming, the Central Government maintains various provisions under the Income Tax Act of 1961, to ease your annual financial burden.

You can learn comprehensive details regarding how to save income tax in India in this article, which will help you save substantially through numerous waivers and exemptions. 

How to Save Tax on Salary in India?

Eligibility

Tax Deduction

Health insurance for individuals, spouse, children (below 60 years)

Up to ₹25,000

For individuals and parents (below 60 years)

Up to ₹50,000 (₹25,000 + ₹25,000)

For individuals (below 60 years) and Senior Citizen parents

Up to ₹75,000 (₹25,000 + ₹50,000)

For individuals and parents (both above 60 years)

Up to ₹1,00,000 (₹50,000 + ₹50,000)

The above rates are as per the Income Tax Act, 1961 as amended from time to time.

Provision for tax benefits on the total amount spent on health check-ups is also present under Section 80D, with a maximum cap of ₹5,000. Such exemptions are included within the premium waivers amounting to ₹25,000. 

 

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FAQs about Saving Income Tax in India