Tax Deductions Salaried Employees Commonly Miss

Every filing season we see the same story: a salaried client who paid more tax than they needed to, simply because a deduction they were fully entitled to never made it onto their return. Here are the ones we see missed most often — and why.

1. The full 80C limit, not just EPF

Many salaried employees assume their EPF contribution alone covers Section 80C, and stop there. EPF does count toward the ₹1.5 lakh limit — but if your EPF contribution doesn't use up the full limit, there's room left for ELSS mutual funds, PPF, life insurance premiums, or your child's tuition fees, all of which count too. Leaving that gap unused is one of the most common missed deductions we see.

2. Section 80D health insurance — including parents' premiums

80D deductions are widely claimed for a policy covering yourself, your spouse and children — but far fewer people claim the additional deduction available for health insurance premiums paid for parents, even though it's a separate limit from your own policy. If you're paying for a parent's health cover, this is very likely money left on the table.

3. HRA — especially with a home loan running in parallel

A surprising number of employees don't realise you can claim HRA exemption on rent paid and home loan interest under Section 24(b) in the same year — for example, if you own a home in one city but rent in the city you work in. These aren't mutually exclusive, but the paperwork (rent receipts, landlord PAN if rent exceeds the threshold, loan interest certificate) needs to be organised, which is exactly the step that gets skipped.

4. NPS under Section 80CCD(1B) — separate from 80C

Contributions to the National Pension System qualify for an additional deduction under Section 80CCD(1B), over and above your Section 80C limit. This is one of the easiest "free" deductions available to salaried employees, yet it's frequently missed simply because people don't realise it sits outside the 80C ceiling rather than competing with it.

5. The standard deduction — automatically applied, but worth checking

The standard deduction for salaried individuals is applied automatically in most cases, but it's still worth confirming it's correctly reflected on your return, particularly if you've switched employers mid-year or your Form 16 has any unusual formatting.

6. Interest on savings account and deposits

A deduction is available on interest earned from savings accounts, subject to a limit — and a higher limit applies for senior citizens on both savings and deposit interest. This is small money individually, but it adds up, and it's routinely left unclaimed simply because people don't think to report and then deduct it.

7. Deductions requiring proof you didn't keep

The single biggest reason legitimate deductions go unclaimed isn't ignorance of the rule — it's not having the receipt or certificate handy when it's time to file. Rent receipts, premium payment receipts, loan interest certificates and investment statements should be collected as the year goes, not hunted down in the final week.

A better habit: plan mid-year, not at filing time

By the time you're sitting down to file, it's often too late to add a new 80C investment or restructure how you're claiming HRA for that financial year. The clients who capture every deduction they're entitled to are almost always the ones who review their tax position mid-year — not just once, in a rush, before the deadline.

How we help

Our Tax Planning & Advisory service reviews your salary structure and investments well before year-end, so every deduction you're entitled to is captured — and documented — before filing time. Curious what you might be missing? Message our CA team for a quick, free review.