Tax Deduction for Salaried Employees: Job seekers should know about the benefits in which tax regime and where you will get exemption

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Income Tax Deductions for Salaried Employees: The government provides various tax exemptions to every salaried employee in the country while filing Income Tax Return (ITR filing).

Many such provisions have been made, under which a taxpayer can get tax exemption on his earnings in the country. And now with the default of the new income tax regime, the employee has to manually choose under which tax regime he will pay his taxes. The deduction is available in both the old and the new tax system, but there is a big difference between the two.

Also, many such deductions are not available in the new tax system, which are available in the old system. In such a situation, you should know which deduction you can claim by choosing which regime, so here we are telling what are the options available to the salaried employee to claim tax deduction.

Rebate under 80C, 80CCC and 80CCD(1)

Section 80C of the Income Tax Act is one of the most popular instruments for tax exemption. Under this section, you can get a discount of up to 1.5 lakhs. You can claim deduction under this section if you have purchased life insurance premium, invested in provident fund, pension plan or have invested money in annuity plan of LIC or any other insurance company. You can get this discount only in the old system.

Deduction under section 80CCD(2)

This is a tax deduction that you can claim in both the old and the new tax regime. In this section, you can get exemption on investment in Government Pension Scheme i.e. National Pension System. Employees under the Central and State Government can claim a deduction of 14% of their salary and 10% of the salary of other employees.

House Rent Allowance (HRA Tax Deduction)

If you live in a rented house and pay rent, you can claim deduction on house rent u/s 10(13A) while filing tax under the old tax regime. HRA is calculated on the basis of your salary structure, rent, city and HRA received from the company.

Will get exemption under section 24(b)

Even considering the interest paid on the home loan, the government gives you tax exemption. If you are paying interest on home loan for the property you are currently living in, you can claim interest deduction while filing ITR in the old tax regime. At the same time, in the new tax regime, you get a deduction on the home loan for a property that you have given on rent. Under this section, the interest paid on the home loan is deducted from the rental income, thereby reducing the tax on your rental income.

standard deduction benefit

The benefit of standard deduction is available in both the regimes. Under this, you can take a discount of 50,000.

87A exemption

This is another tax deduction that you can claim on both the old and the new. In the old system, you get tax exemption on income up to 5 lakhs, while in the new system it has been increased to 7 lakhs. In the old regime, you get a rebate of Rs 12,500, while in the new regime it is Rs 25,000.

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