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
| Deduction / Option | Salaried | Self-Employed |
|---|---|---|
| Standard Deduction ₹50k | ✅ | ❌ |
| Section 80C (₹1.5L) | ✅ | ✅ |
| Section 80D (Health) | ✅ | ✅ |
| NPS – 80CCD(1B) ₹50k | ✅ | ✅ |
| Presumptive Tax (44ADA) | ❌ | ✅ |
| HRA / LTA | ✅ | ❌ |
| Business Expenses | ❌ | ✅ |
| Home Loan (80C + 24b) | ✅ | ✅ |
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.
