Best Tax Saving Tips for Salaried & Self-Employed in 2025.

Here are the best tax-saving tips for salaried and self-employed individuals in 2025 (based on the latest rules as of FY 2024-25):

🧾 1. Choose the Right Tax Regime (Old vs New)

• Old Regime: Offers deductions and exemptions.

• New Regime: Lower slab rates but no common deductions (except for standard deduction and NPS employer contribution from FY 2023-24 onwards).

👉 Tip: Calculate tax under both regimes before filing. Use the one with lower liability.

👨‍💼 2. For Salaried Individuals

✅ a. Standard Deduction (New & Old Regime)

• ₹50,000 flat deduction (now available in both regimes).

✅ b. House Rent Allowance (HRA)

• Claim HRA exemption if you pay rent.

• Keep rent receipts & PAN of landlord (if rent > ₹1L/year).

✅ c. Leave Travel Allowance (LTA)

• Can be claimed twice in 4 years (for domestic travel only).

• Retain travel bills, tickets.

✅ d. Section 80C (Up to ₹1.5 Lakh under Old Regime)

Options include:

• EPF, PPF, ELSS Mutual Funds

• Life insurance premium

• Home loan principal repayment

• Tuition fees (for up to 2 children)

✅ e. NPS (National Pension Scheme)

• Section 80CCD(1B): Additional ₹50,000 over 80C.

• High tax saving + builds retirement corpus.

✅ f. Health Insurance – Section 80D

• Up to ₹25,000 (self/family), ₹50,000 (for senior citizen parents).

🧑‍💻 3. For Self-Employed Professionals & Freelancers

✅ a. Business Expenses

• Claim actual business-related expenses:

  • Rent, phone bills, internet

  • Travel, marketing, software, depreciation on assets

• Maintain invoices & bank records.

✅ b. Presumptive Taxation Scheme (44ADA)

• If your annual professional income ≤ ₹75 lakhs:

  • Only 50% of gross receipts are taxed.

  • No need to maintain books or get audit done (if income under threshold).

✅ c. Section 80C, 80D, 80CCD – Still Applicable

• Self-employed can claim deductions under:

  • 80C (LIC, ELSS, PPF, etc.)

  • 80D (Health insurance)

  • 80CCD (NPS contributions)

🏠 4. Home Loan Benefits

• Section 24(b): Deduction of up to ₹2L on interest paid (on self-occupied house).

• 80C: Deduction on principal repayment.

💼 5. Invest Smartly for Tax + Wealth Creation

Popular tax-saving investments:

• ELSS Mutual Funds – Tax saving + equity growth (3-year lock-in).

• PPF – Safe, long term (15-year lock-in).

• NPS – Retirement-focused, additional ₹50K deduction.

• Tax-saving FDs – 5-year lock-in, taxable interest.

📚 6. Education Loan – Section 80E

• Deduction for interest on loan for higher education (self, spouse, kids).

• No cap on amount; available for 8 years.

🧓 7. Senior Citizens (60+)

• Higher deductions:

  • 80D: ₹50,000 for health insurance.

  • No TDS on interest income up to ₹50,000 (Section 80TTB).

⚠️ 8. Donations – Section 80G

• Donations to eligible charities = up to 100%/50% deduction.

• Must be via digital payment, and organization must be registered.

🗂️ 9. Keep Records Ready

• Form 16 (for salaried)

• Rent receipts, LIC premium, ELSS statements

• Bank interest certificates

• Proofs of all deductions claimed

💡 10. Use Online Calculators or Consult CA

• Income tax portals now offer automatic comparison between regimes.

• Consider consulting a CA for:

  • Complex income (freelancers, multiple sources)

  • Choosing between presumptive vs regular taxation

  • Capital gains planning

✅ Summary Table

If you’d like, I can help you calculate your estimated tax or optimize your investment planning based on your income. Just let me know your details.