Essential Points to Consider When Filing Income Tax Returns under the Old Tax Regime

Filing income tax returns can be an overwhelming process, but understanding the various tax-saving points available can help you minimize your tax liability.

In this article, we will explore ten important points to consider when filing your income tax returns under the old tax regime. By leveraging these points, you can potentially save a significant amount of money and optimize your tax planning strategy. Let’s dive into the details

1. Tax Relief on Arrears: If you have received any arrears or pending salary, it’s crucial to check for applicable tax relief. Certain provisions allow relief on arrears, reducing the tax burden on such income. By claiming this relief, you can ensure that you are not paying more tax than necessary.
2. Medical Expenditure under Section 80D (For Senior Citizens): If you are a senior citizen, don’t forget to consider the medical expenditure deduction under Section 80D. This provision allows you to claim deductions on medical expenses incurred for yourself or your dependents. Be sure to keep track of these expenses and utilize the deduction to its fullest extent.
3. Refund Verification and Bank Details: In case you are eligible for a tax refund, ensure that your bank details are correctly provided and verified before submitting your return. This step is crucial to ensure a smooth refund process and prevent any delays or complications.
4. Municipality Tax Paid for House: If you own a house, remember to include the municipality tax paid as a deductible expense. This includes property tax paid to the local municipality or corporation. By considering this deduction, you can reduce your taxable income and potentially save a significant amount on taxes.
5. Rent Paid for House: If you live in a rented house, you can claim deductions on the rent paid under certain conditions. Be sure to maintain proper rent receipts and include the necessary details while filing your return. This deduction can provide substantial tax savings for individuals living in rented accommodations.
6. Expenditure on Preventive Health Checkup: Promoting a healthy lifestyle is rewarded under the income tax laws. By undergoing preventive health checkups, you can claim deductions on the expenses incurred. This not only helps in early detection of health issues but also provides tax benefits.
7. Stamp Duty and Registration Fees for House Purchase: When you purchase a house, the stamp duty and registration fees are significant expenses. However, these expenses are eligible for deduction while calculating your taxable income. Make sure to retain the necessary documents as proof of payment and claim the deduction appropriately.
8. Tuition Fees for Children: As a parent, you can claim deductions on the tuition fees paid for your children’s education. This deduction can be availed for up to two children and is applicable for school, college, or university fees. Ensure you collect valid receipts and take advantage of this tax-saving opportunity.
9. Commission Paid to Agent or Legal Fees for Property Sale: If you sold a property and incurred expenses on agent commissions or legal fees, these expenses can be considered as deductions. These deductions can help reduce the taxable capital gains arising from the property sale, optimizing your tax liability.
10. House Renovation Expenditure (Property Sale): In case of property sale, any expenditure incurred on house renovation can be claimed as deductions. These expenses can be considered as part of the cost of acquisition or improvement, thereby reducing the taxable capital gains. Make sure to maintain proper documentation of renovation expenses to substantiate your claim.