Useful tips to save money by availing tax exemption
Follow these tips while working and build a better future for your family.
The joy of earning and spending money is unparallel as compared to all material bliss. It gives us the stature of an established entity in the society. Nevertheless, we tend to overlook the importance of savings in the process of spending money. Subsequently, this hits back at our dire times when we are left with no money.
Do you know that you can save a heck lot of money by investing on your important needs and get tax relaxation in the process? A win-win situation for you! So, take a look at some of the cool saving hacks that will help you to spend in a wise way and get tax relaxation at the same time.
Here you go…
Good news for working professionals with a family! If you are planning to buy a house, make sure to apply for the home loan jointly with your wife. This will make both of you entitled to avail a tax deduction of Rs. 2 to 2.5 Lakh. Even better, if a person having a working son/daughter can split the loan into three parts, and all of them can avail the deduction. A great way of saving your precious money like a pro!
Please note that the hotel accommodation you get for the first half of the month during your job transfer to a new location, the money provided by the employer is not included under taxable income. Enjoy!
Are you feeling bored of your working life? It’s time to take a break and go for travelling. And, this will not cost a penny! Sounds interesting? Well, LTC exemption in the form of travel allowance is allowed to every salaried employee in regard to two domestic outing in the gap of four years. So, if you haven’t availed this facility for the past 2 years, go for it now! Take a break, keep records of all the travel bills and claim your LTC.
Please make sure to show the expense bill if you are commuting for official purposes. In this case, you can claim your transport allowance from your employer, and the money doesn’t fall under taxable income. Cool!
Provident Fund is the golden asset for every employee. However, you cannot withdraw the amount as it has block period of 5 years. In case, you want to avail a loan based on the PF balance, you can do so once the PF balance has passed 1 year of its maturity, subjected to various terms and conditions.
Savings on house rent
If you or your wife/children doesn’t own a house, and the company doesn’t provide any HRA, you can show your house rent bill and avail tax relaxation on the rent under Section 80GG. The highest limit of deduction is of Rs. 5,000 per month.
HRA and Loan
Here’s the catch and a bonus for you! Suppose, you bought a house on loan, and staying at a rented house as of now, which is far from the place where you bought the home, then you are allowed to claim HRA exemption and interest deduction on house loan at the same time.
These were some of the coolest ways of saving money and managing your lifestyle in a perfect way simultaneously. Hope this information will add value in your life. In case, you have something to say, please feel free to pen down your comments in the below mentioned box. You can also share this article across your circle to let your friends know about the ways to avail tax exemptions and save money in the process.