Filing Income Tax Returns (ITR) via pre-filled forms makes the process more convenient and lessens the hassle of the procedure. However, some have observed that the latest pre-filled ITR forms may not be updated with certain tax deductions that one can claim. Since these exemptions are not present in Form 26AS or the Annual Reflection System, they may not be automatically uploaded on the pre-filled ITR forms. Additionally, the removal of several exemptions under the new tax regime, as well as the many types of ITR available, could also complicate matters. To make things easier, we provide you with a list of deductions that you should not miss when using pre-filled ITR forms. 

Deductions on interest earned on a savings bank account

If the estimation of the income tax calculator is quite high, and you are looking for ways to reduce it, know that you can get a tax deduction on the interest you receive from your savings bank account. Under Section 80TTA of the Act, one can avail a deduction of Rs. 10,000 on savings bank account interest. Those accountholders whose savings accounts have earned interest amounting to less than Rs.10,000 can enjoy exemptions on the entire interest amount. 

Do note that this deduction is eligible only for interest earned on savings accounts and not for interest received on fixed deposits or recurring deposits attached to the said savings account.

Tax deduction on uninsured parents’ medical bills 

Many may be under the misconception that the medical bills of their parents can help save tax only if the parents are covered under a health insurance policy. However, the medical bills of uninsured parents who are over 60 years of age can also lead to tax savings. One can save up to Rs. 50,000 on their taxes in this manner under Section 80D of the Income Tax Act. The medical bills should have been issued for the medical treatment of the taxpayer’s parents during the previous financial year. 

One of the conditions required for this deduction to be considered valid is that the parents should be financially dependent on the taxpayer. Some tax experts say that expenses incurred in the purchase of medicines for senior parents can be claimed as deductions. So, do keep in mind to claim this deduction when following the steps to file income tax returns. 

A note to remember: 

If you are looking to gain these deductions, then it is vital that you make the payment for the aforementioned situations via modes other than cash. 

Deductions on house rent in absence of HRA

Most individuals living in rented houses reduce their tax expenditure by taking advantage of the House Rent Allowance (HRA) aspect that is present in their salary structure. However, if the same is not present in your salary package, you can still lower your tax outflow. Section 80GG of the Act allows salaried individuals to claim deductions on the house rent paid. The deduction shall be quantified on whichever of the three following amounts is the lowest: 

– Rent amount after subtracting 10% of the taxpayer’s total income 

– Rs. 5,000 on a monthly basis 

– 25% of the total income of the taxpayer 

Deductions on donations 

Section 80G also allows taxpayers to claim deductions on the payments made towards charitable organisations. If the organisation is a government-recognised one, the deduction can be 100%. In the case of donations to a private charitable organisation, the deduction could be up to 50% of the amount paid. 

Some tips to keep in mind when availing of tax deductions:

1. Using an income tax calculator can help you get a stronger idea of your tax outgo and thus, may motivate you to look for more ways to reduce it. 
2. Since there are multiple types of ITR forms available, ensure to choose the right one. Making a claim for the given deductions in the wrong ITR can lead to the returns being rejected. 
3. Do read the terms and conditions prescribed for these deductions and ensure you are compliant with them before going ahead. 

So, the next time you are following the steps to file income tax returns, do make a point to claim the deductions mentioned here. Thank you for reading!