A salaried individual earning ₹15 lakh can legally save ₹1-2 lakh in taxes with proper planning. Here are 15 strategies available under the Old tax regime for FY 2025-26.
Important: These Strategies Are for Old Regime
The New Tax Regime (default from FY 2023-24) does not allow most deductions. To use these tax-saving strategies, you must opt for the Old Tax Regime when filing your ITR. The Old regime is beneficial if your total deductions exceed ₹3.75 lakh. Use our Income Tax Calculator to compare both regimes before deciding.
Top 15 Legal Tax-Saving Strategies
| # | Strategy | Section | Max Deduction |
| 1 | ELSS mutual fund investment | 80C | ₹1.5 lakh |
| 2 | PPF contribution | 80C | ₹1.5 lakh |
| 3 | EPF (employee contribution) | 80C | Part of 80C limit |
| 4 | Life insurance premium | 80C | Part of 80C limit |
| 5 | Health insurance (self + family) | 80D | ₹25,000 + ₹25,000 parents |
| 6 | NPS contribution | 80CCD(1B) | ₹50,000 (over 80C) |
| 7 | Home loan interest (self-occupied) | 24b | ₹2,00,000 |
| 8 | Home loan principal | 80C | Part of 80C limit |
| 9 | HRA exemption | 10(13A) | Based on formula |
| 10 | Leave Travel Allowance (LTA) | 10(5) | Actual travel cost |
| 11 | Standard deduction (salaried) | 16(ia) | ₹50,000 |
| 12 | Education loan interest | 80E | Full interest, 8 years |
| 13 | Disability deduction | 80U / 80DD | ₹75,000 – ₹1.25 lakh |
| 14 | Donations to charity | 80G | 50% or 100% of donation |
| 15 | Interest on savings account | 80TTA | ₹10,000 |
Strategy 1-3: Maximise Section 80C (₹1.5 Lakh)
The most impactful single deduction. Tax saved on full ₹1.5L: ₹46,800 (30% slab + cess). Best combination: ELSS (market-linked, 3-year lock-in) for growth + PPF for safety + LIC premium if you need life cover. Avoid over-investing in PPF/NSC if you already have EPF bringing you close to the ₹1.5L cap.
Strategy 5-6: Health Insurance + NPS Extra Deduction
Section 80D: ₹25,000 for self/spouse/children health insurance. Additional ₹25,000 for parents (₹50,000 if parents are senior citizens). Section 80CCD(1B): ₹50,000 additional deduction for NPS (National Pension System) investment — this is OVER AND ABOVE the ₹1.5L 80C limit. Combined, this reduces taxable income by ₹1,00,000 more.
Strategy 7-9: Home and Rent Benefits
Home loan interest under Section 24b: up to ₹2 lakh deduction if the house is self-occupied. If rented out, the entire interest is deductible (no limit). HRA: if you pay rent and receive HRA from employer, the exempt portion reduces your taxable income significantly. Calculate HRA exemption using our HRA calculator. LTA: claim actual airfare/train fare for 2 trips in a 4-year block.
How Much Tax Can You Actually Save?
| Annual Salary | Tax Without Planning (New Regime) | Tax With Planning (Old Regime) | Savings |
| ₹10 lakh | ₹54,600 | ~₹20,000 with full 80C + 80D | ~₹34,000 |
| ₹15 lakh | ₹1,17,000 | ~₹65,000 with full deductions | ~₹52,000 |
| ₹20 lakh | ₹2,10,600 | ~₹1,35,000 with full deductions | ~₹75,000 |
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