Tax Deductions: Taxpayers should claim these 5 tax deductions in the old tax regime. Otherwise, you will have to pay more tax

If you are choosing the old tax system for the financial year 2024-25 (AY 2025-26), then definitely claim these 5 important tax deductions. Otherwise, you may have to pay more tax. You can get huge tax exemptions from investments like health insurance, EPF, PPF, ELSS.

The ITR filing season has begun! The facility to file ITR-1 and ITR-4 is already open and till now (till June 30, 2025) about 67 lakh people have filed and verified their returns. But if you are going to file ITR-2 or ITR-3, then you may have to wait a bit as these forms are not yet available online. In such a situation, when these forms come, there may be a huge rush at the last minute. And in that hurry, if you forget to claim any important tax deduction, then you may have to pay more tax.

So why not start preparing from now? We have told you about those common but important tax deductions under the old tax system, by claiming which you can reduce your tax burden.

Tax deductions while filing ITR under Old Tax Regime

If a taxpayer does not claim tax deduction on investments made in a financial year in the Income Tax Return (ITR) of that year, then the deduction cannot be claimed again in any other year. Hence, it is important for taxpayers who have opted for the Old Tax Regime to know what all deductions they can avail.

Deduction on health insurance premium under section 80D

If you are below 60 years of age and have paid premium for health insurance for yourself or your dependents (such as wife and children), you can claim a maximum tax deduction of up to ₹25,000. If you have also paid premium for your parents’ health policy, you will get a separate deduction for them as well – up to ₹25,000 if the parents are below 60 years of age and up to ₹50,000 if the parents are 60 years or above.

Apart from this, an additional deduction of up to ₹5,000 is also available on preventive health checkup, but this amount is included in the total limit of ₹25,000 or ₹50,000. If you have not taken any health insurance for your senior citizen parents but have spent on their treatment, you can claim a deduction of up to ₹50,000 as medical expenses.

Deduction on Employees’ Provident Fund (EPF) under Section 80C

Most salaried employees are covered under the Employees’ Provident Fund (EPF) scheme. Under this scheme, employees deposit 12% of their salary in the EPF account and an equal amount is contributed by their employer. However, under Section 80C, you can claim tax deduction only on your contribution and not on the employer’s contribution. If you wish, you can choose the Voluntary Provident Fund (VPF) option to put additional money in EPF. But keep in mind that the combined contribution to EPF and VPF should not exceed your basic salary in any financial year.

Deduction under Section 80C on investment in Public Provident Fund (PPF)

If you choose the old tax regime, then under Section 80C you can claim tax deduction of up to ₹ 1.5 lakh. One of these investment options is Public Provident Fund (PPF). PPF comes under the EEE category (Exempt-Exempt-Exempt) in the tax world. This means tax deduction on investment, no tax on interest and the entire amount received on maturity is also tax-free.

The lock-in period of PPF is 15 years, but if you want, you can extend it further. Keep in mind – deduction under Section 80C can be claimed only for the financial year in which the investment is made and this facility is available only in the old tax system.

Tax deduction under section 80C on investment in ELSS mutual funds

ELSS or Equity-Linked Saving Schemes are mutual funds that invest your money in the stock market (equity) and their lock-in period is only 3 years. These are a popular option to save tax under section 80C because their lock-in is the lowest compared to other investment options. You can claim tax deduction of up to ₹1.5 lakh under section 80C by investing in ELSS. But note, this limit is only ₹1.5 lakh in total when combined with other 80C investments (such as PPF, EPF, LIC etc.). That is, if you invest ₹50,000 in ELSS and the rest ₹1 lakh in any other scheme, then the entire deduction of ₹1.5 lakh can be claimed.

However, when you sell ELSS mutual funds after 3 years, the profit earned on it is taxable. That is, tax exemption is available only at the time of investment, but some tax may have to be paid on the return. Now an important thing – if you invested ₹ 50,000 in ELSS in a financial year, but claimed deduction of only ₹ 20,000 that year – then you cannot claim the remaining ₹ 30,000 in the next year. According to tax expert Abhishek Soni (Tax2Win), deduction under section 80C can be claimed only in the financial year in which the investment is made.

Can a husband claim tax deduction on investments made by his wife or children?

According to tax expert Abhishek Soni, you cannot directly claim tax deduction on investments made by your wife or children. Tax deductions like Section 80C, 80D are available only to the person who has actually spent or invested from his own income. This means that if your wife has made an investment from her income and she has not claimed deduction on it, then you cannot take deduction on her investment – even if it is investable.

However, Abhishek Soni also tells that if you want, you can plan the tax benefits in a better way by investing in joint name. Joint home loan or joint life insurance. Through these, both the husband and wife can claim separate tax deductions, provided both have contributed to that expense or investment.

The post Tax Deductions: Taxpayers should claim these 5 tax deductions in the old tax regime. Otherwise, you will have to pay more tax first appeared on informalnewz.

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