Ask AI Anything: We asked ChatGPT how to save tax in India — Its advice was surprisingly practical

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1. Choose the Right Tax Regime

Old Regime: Offers deductions and exemptions.

New Regime (lower tax rates): Fewer deductions/exemptions.

If you have many investments and expenses eligible for deductions, old regime might be better.

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2. Maximise Deductions under Section 80C (Limit: ₹1.5 lakh)

Some popular options:

EPF/VPF (Employees' Provident Fund)

PPF (Public Provident Fund)

ELSS (Equity-Linked Saving Schemes)

Life insurance premium

Principal repayment on home loan

Children's tuition fees

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3. Health Insurance – Section 80D

Up to Rs 25,000 (self, spouse, children)

Additional Rs 25,000–Rs 50,000 for parents (depending on age)

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4. Home Loan – Section 24(b)

Deduction of up to Rs 2 lakh on interest paid on home loan for a self-occupied property.

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5. NPS (National Pension System) – Section 80CCD

Extra Rs 50,000 over and above 80C for investing in NPS (Tier I account).

Employer’s contribution (up to 10% of basic + DA) is also deductible under 80CCD(2).

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6. HRA (House Rent Allowance) – If you live on rent

Claim HRA if you live in rented accommodation and receive HRA as salary component.

If no HRA, use Section 80GG (limited benefits).

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7. Education Loan – Section 80E

Deduction on interest paid on loan for higher education (no cap, available for 8 years).

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8. Donations – Section 80G

Donations to specified funds/charities are deductible (50%-100%, with/without qualifying limit).

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9. Standard Deduction

Rs 50,000 standard deduction for salaried individuals and pensioners (auto-applied).

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10. Tax-Free Allowances

Some components of salary can be tax-free if structured right:

Meal coupons (up to Rs 2,200/month)

Leave travel allowance (LTA – for travel within India)

Reimbursements (mobile/internet bills used for work)