ITR Filing for FY 2024-25: Opting Old Tax Regime? Deductions You Must Know Before Filing
If you are filing your Income Tax Return (ITR) for the financial year 2024-25 and you are opting for the old tax regime. Then you must be aware of various deductions available under the old tax regime to reduce your taxable income. Below is a list of deductions available under different sections of the Income Tax Act, along with the maximum limits and the documents or details you will need to claim them correctly.
All the deductions listed below can reduce your taxable income and, therefore, your tax payable. But to claim them, you must provide valid documents such as account numbers, PANs, receipts, certificates, and letters. When filing your ITR, make sure these details are handy, whether you are doing it yourself or through a tax professional.
1. Section 80C: Investment-Based Deductions (Max: Rs. 150,000)
This section allows you to claim deductions for investments and expenses like LIC premium, Public Provident Fund (PPF), Equity Linked Savings Scheme (ELSS), National Savings Certificate (NSC), Tuition fees for children, Employee Provident Fund (EPF) and Principal repayment of a home loan.
- Documents: To claim these, you must have details such as Policy number, account number, or investment certificate- Employer’s PF account details if claiming EPF.
2. Section 80D: Health Insurance Premium (Max: Rs. 25,000 or Rs. 50,000)
This section allows you to claim deductions for the premium paid for health insurance:
- Rs. 25,000 for self and family (below 60 years)
- Rs. 50,000 if the insured person (you or your parents) is a senior citizen (60+)
- Documents: To claim these, you must have details such as Policy number, Name of insurance company and Premium payment receipt.
3. Section 80E: Education Loan Interest (No Limit, for 8 Years)
If you have taken a loan for higher education (for yourself, spouse, or children), you can claim the interest paid (no limit) for up to 8 financial years.
- Documents: To claim this deduction, you will require documents such as the Loan account number and a Certificate from the bank/NBFC showing the interest paid.
4. Section 80G: Donations to Approved Charities
You can claim 50% or 100% of your donation amount, depending on the organisation. Some donations also have a limit on how much you can claim; others don’t.
- Documents: To claim this deduction, you will require documents such as a Donation receipt, a Donation reference number and the 80G registration number of the trust/organisation.
5. Section 80CCD(1B): Additional NPS (National Pension Scheme) Contribution
An extra Rs. 50,000 deduction is available for additional contributions to NPS, apart from the 80C limit.
- Documents: To claim this deduction, you will require a PRAN (Permanent Retirement Account Number).
6. Section 80DD/80U: Disability Deduction (For Dependent or Self)
If a person has a disabled dependent or is personally disabled, deductions are:
- Rs. 75,000 for 40%-79% disability
- Rs. 125,000 for 80% and above
- Documents: To claim this deduction, you will require documents such as Disability certificate number and the Aadhaar/PAN of the dependent (if applicable).
7. Section 80TTA / 80TTB: Interest on Savings Accounts
- For regular taxpayers (below 60), a Rs. 10,000 deduction on savings bank interest (Section 80TTA)
- For senior citizens (60+), an Rs. 50,000 deduction, which includes both savings and fixed deposit interest (Section 80TTB)
- Documents: Usually, bank details like account number and IFSC code are auto-filled, but keep them ready.
Now, let us look at loan-related deductions, especially for housing and education loans, which can be claimed along with the above:
1. Section 24(b): Interest on Housing Loan
If you have a home loan, you can claim a deduction on the interest paid:
- Up to Rs. 200,000 for a self-occupied house
- Full interest amount if the house is let out (rented)
- Documents: To claim this deduction, you will require documents such as Lender’s name and PAN, the Loan account number, Interest certificate from the bank or housing finance company (HFC), Property address, etc.
2. Section 80C: Principal Repayment of Housing Loan
You can claim the principal portion of your home loan under Section 80C (within the Rs. 1.5 lakh limit).
- Documents: To claim this deduction, you will require documents such as Loan account number, Certificate from the bank or HFC showing the principal amount paid and Possession certificate or completion certificate of the house.
3. Section 80EE: First-Time Home Buyer
If you are a first-time homebuyer, and your loan was sanctioned under certain conditions, you can claim an additional Rs. 50,000 on home loan interest.
- Documents: To claim this deduction, you will require documents such as Loan sanction letter (date and amount), Loan account number and the PAN of the lender.
4. Section 80EEA: Affordable Housing Deduction
If you bought an affordable house (with a stamp duty value under Rs. 45 lakh) and your home loan was sanctioned between 1 April 2019 and 31 March 2022, you can claim up to Rs. 1,50,000 on interest.
- Documents: To claim this deduction, you will require documents such as Loan account number, Loan sanction letter and Proof of stamp duty value.
5. Section 10(13A): House Rent Allowance (HRA) Exemption
If you are living in a rented house and receiving HRA from your employer, you can claim an exemption based on 3 conditions (the least of them is allowed). Even if you own a house elsewhere (on loan), you can still claim HRA if you rent your current residence.
- Documents: To claim this deduction, you will require documents such as Landlord’s name, address, and PAN (PAN is mandatory if annual rent is over Rs. 100,000) and Rent agreement or rent receipts.