Effective Tax-Saving Strategies for FY 2025-26 Under Old Tax Regime

As the financial year 2025-26 draws to a close on March 31, taxpayers following the old tax regime still have a window of opportunity to reduce their tax liability through various deductions. Acting swiftly before the deadline can help maximize tax savings.

Key Tax-Saving Avenues:

• National Pension System (NPS) Contribution: Taxpayers can invest an additional ₹50,000 in NPS under Section 80CCD(1B), which is over and above the ₹1.5 lakh limit under Section 80C. This can increase total deductions up to ₹2 lakh.
• Health Insurance Premiums: Payments towards health insurance premiums for self, family, and parents can be claimed as deductions under Section 80D. The limits vary based on age and whether the individual is a senior citizen.
• Donations to Charitable Institutions: Qualifying donations made to registered charitable institutions are eligible for deductions under Section 80G.
• Interest on Savings Account: Individuals and Hindu Undivided Families (HUFs) can claim a deduction of up to ₹10,000 on interest earned from savings accounts under Section 80TTA. For senior citizens, this limit is ₹50,000 under Section 80TTB, covering interest from all types of deposits.
• Tax-Loss Harvesting: For investors, strategically selling loss-making investments can offset capital gains, reducing overall tax outgo. This requires careful planning and understanding of capital gains rules.

It is crucial for taxpayers to review their financial planning and utilize these available deductions to optimize their tax position before March 31, 2026.