India’s Income Tax Act provides a plethora of exemptions and deductions intended to reduce the tax burden on individuals. For women, these specific provisions aim to encourage their participation in the workforce and foster financial independence. This article explores the distinct tax exemptions afforded to women in India, highlighting how they can maximise these benefits.
Higher Basic Exemption Limit
• The baseline exemption level is larger for women taxpayers than for men.
• This implies that women have a larger tax-free income threshold, up to a specific sum.
• This distinction is made to promote equality in workforce representation, and offer financial relief.
• Depending on the budget announcements for each fiscal year, the exemption's precise amount may change.
Home Loan Rebate
• To promote home ownership, the government offers women home loan refunds.
• Women are eligible for an additional deduction on the interest paid if they are the sole or co-owner of a property and have taken out a loan for its construction or purchase.
• This strategy encourages real estate investment and aids in wealth building.
Lower Stamp Duty Fees
• Women who register property in their names are eligible for reduced stamp duty rates in a number of Indian states.
• Depending on the state, this discount is usually one to two per cent less than the cost for men.
• By making it more appealing for women to register property in their names, this legislation aims to promote gender equality in asset ownership.
Benefits Of A Savings Plan
• To encourage a culture of saving and investing among women, the government offers a number of savings plans with alluring rewards.
• Usually, these plans give women investors tax breaks or higher interest rates.
• For instance, programs like the Sukanya Samriddhi Yojana, which offer high interest rates and tax deductions under Section 80C of the Income Tax Act, are expressly made to help girls save for their higher education and marriage.
Premium Deductions For Health Insurance
• Section 80D of the Income Tax Act allows women taxpayers to deduct any premiums paid for their own and their family' health insurance coverage.
• This benefit, which offers financial advantages in the form of tax savings, encourages them to purchase health insurance coverage.
• The deduction limit is determined by whether family members are included in the policy coverage or just the women themselves.