- Availing a Home Loan Together:
Home loans are usually an attractive option for people looking to save taxes, and for couples, the benefit is double. If the loan is co-borrowed with a spouse then both can claim a deduction of principal and interest payment 80C and 24(b) of the Income Tax Act respectively.
- Availing a Life Insurance Policy Together:
Similar to home loans, an insurance policy is another method commonly employed by people to save taxes. If a couple buys a term life insurance policy together, they can claim deductions under Section 80C of the Income Tax Act. The tax deductions available can be claimed individually by both husband and wife u/s 80C of the Income Tax Act capped up to a limit of 1.5 lakh.
- Plan Investments Carefully:
A couple can plan their investments such that the overall tax liability of the household decreases. For instance, if one spouse is in the 30% tax bracket, they are advised to make higher tax investments while the other spouse focuses more on instruments intended to maximize savings. By planning well in advance, tax benefits for couples can be compounded significantly.
- Save tax on school fees:
Children’s school fees are another option for couples looking to save on taxes since they are eligible for deductions under the Income Tax Act’s Section 80C. The deduction, however, is limited to only two children and can be claimed by the parent who is paying the fees.
- Leave Travel Concession (LTA) exemption:
LTA exemption is available under Income Tax, to the extent of the travel cost. Currently, the exemption can be claimed by a taxpayer in respect of two journeys performed in a block of four calendar years. A couple can thus claim their respective LTA benefits every alternate year.
5 Tax Saving Tips For Couples
It is essential to learn about tax benefits for couples to maximize savings and achieve financial goals, whether for the long-term or short-term period.
Read on to learn in detail about how tax benefits for couples are compounded.