How to save tax for salary above Rs. 9 lakh

To save tax on a 9 lakh salary, maximise deductions under Section 80C, invest in tax-saving instruments like EPF, PPF, insurance, and utilize deductions for HRA, LTA, and medical expenses wisely.
How to save tax for salary above Rs. 9 lakh
3 min

Every Indian citizen in the tax bracket is liable to pay taxes on the earnings in a financial year. The same goes for salaried employees who receive a specific amount every month. As a salaried employee, you must pay taxes on the salary you earn every year. However, paying taxes reduces the overall savings, negatively affecting your long-term financial plan. Hence, it is important that you know how you can save taxes to ensure increased savings.

This blog will help you understand how to save tax for a salary above Rs. 9 lakh to avoid paying additional taxes.

Tax slabs under old vs New tax regime

The Indian government introduced the new tax regime in the Union Budget 2020 as an alternate option for taxpayers while filing their taxes. Here are the income tax slabs for FY 24-25 under the old regime and the new regime:

Annual income Old tax regime New tax regime
Up to Rs. 2.5 lakh NIL NIL
Rs. 2.5 lakh - Rs. 5 lakh 5.00% 5.00%
Rs. 5 lakh - Rs. 7.5 lakh 20.00% 10.00%
Rs. 7.5 lakh - Rs. 10 lakh 20.00% 15.00%
Rs. 10 lakh - Rs. 12.5 lakh 30.00% 20.00%
Rs. 12.5 lakh - Rs. 15 lakh 30.00% 25.00%
Above Rs. 15 lakh 30.00% 30.00%


Tax saving above 9 lakh salary under the new regime

The new regime does not offer a host of deductions and was created for individuals who do not want to invest in numerous investment instruments for tax benefits. However, there are still some deductions you can use to save tax on a Rs. 9 lakh salary:

Standard deduction Basic deduction for salaried individuals
Section 80CCD(2) Employer contribution to NPS
Section 80CCH Investments made in Agniveer corpus
Section 57(iia) Family pension received
Section 10(10C) Voluntary retirement
Section 10(10) Gratuity
Section 10(10AA) Leave encashment
Section 24 Interest on a home loan on the let-out property

Furthermore, some other deductions under the new regime are as follows:

  • Transport allowance in case you are a specially-abled person.
  • Conveyance allowance to cover the expenses incurred for travelling as part of the employment.

Also read about: Short-term capital gains tax

Tax saving above 9 lakh salary under the old regime tax

The old tax regime contains numerous deductions and exemptions you can use to lower your tax liability significantly on a Rs. 9 lakh salary. Here are the deductions you can utilise:

Section 80D - health insurance premium

Rs. 25,000 for self, spouse, and dependent children

Rs. 50,000 if above 60 years of age

Parents: Rs. 25,000 and Rs. 50,000 if above 60 years of age.

Section 80 E-education loan

Deduction for 8 years from the year of repayment of education loan taken for self, spouse, dependent children, or for a student for whom the individual is a legal guardian.

Section 80G - donating to charity

50% of 100% of the donated amount for notified institutions.

Section 80C investing in tax saving instruments

Tax benefits up to Rs. 1.5 lakh. Some investing options include:
  • Public Provident Fund (PPF)
  • Employees’ Provident Fund (EPF)
  • Equity Linked Saving Scheme funds (ELSS)
  • Home loan repayment and Stamp duty
  • Sukanya Smriddhi Yojana (SSY)
  • National Savings Certificate (NSC)
  • Fixed Deposit for 5 years and more

Section 80DD- costs to treat disabled dependents

If you bear the medical cost for disabled dependants, you are eligible for tax relief:
  • 40% disability: Rs. 75,000
  • 80% or severe disability: Rs. 1.25 lakh

Home loan payments

Principal amount: Up to Rs. 1.5 lakh u/s 80C

Interest amount: Up to Rs. 2 lakh paid under section 24b

The maturity amount of a Life Insurance Policy

You can take a tax benefit on the maturity proceeds if the sum assured is less than:
  • 20% for policies issued before 1 April 2012
  • 10% for policies issued after 1 April 2012
  • 15% for policies issued after 1 April 2013 for a person with a disability.

Also read about: Long-term capital gains tax

How to save tax for salary above 9 lakh?

Here is how to save tax for salary above Rs. 9 lakh:

1. Choose the right regime

As there are two tax regimes, it is important that you choose between the two. Analyse both tax regimes and decide between the old tax regime (with deductions and exemptions) and the new tax regime (with lower tax rates but no deductions). Evaluate which regime offers the lowest tax liability based on your eligible deductions and exemptions. You can use online tax calculators to compare the tax liability of both tax regimes and choose the most suitable one.

2. Claim standard deduction

When filing taxes, ensure that you utilise the standard deduction of Rs. 50,000. The standard deduction is available in both tax regimes, so you do not have to compare the two based on this deduction. Utilising the standard deduction will effectively lower your taxable income by Rs. 50,000.

3. Claim deduction for interest paid against home loan

If you have a home loan, you can claim a deduction for the interest you pay on it while filing taxes. Under section 80C, you can claim a deduction on the principal amount up to Rs. 1.5 lakh, while you can claim a deduction on the interest amount up to Rs. 2 lakh under section 24b.

4. Claim deduction under section 80C of the Income Tax Act

Section 80C provides numerous deductions, and you can fully utilise them to lower your taxable income by Rs. 1.5 lakh. Some investments under section 80C are:

  • Public Provident Fund (PPF
  • Employee Provident Fund (EPF)
  • Equity Linked Savings Scheme (ELSS)
  • National Savings Certificate (NSC)
  • Life Insurance Premiums
  • Principal repayment of home loan
  • Tuition fees for children

Also read about: How to start a SIP

5. Claim rebate under section 87A

If your taxable income after deductions is up to Rs. 5 lakh, you can claim a rebate under Section 87A, which reduces your tax liability to zero. It can help you pay no tax on a salary of Rs. 9 lakh.

Additional deductions under the old regime:

You can maximise your tax savings by utilising additional deductions under the old regime, such as:

  • Section 80D: Health insurance premiums (Rs. 25,000 for self, spouse, and children; an additional Rs. 25,000 for parents below 60 years, Rs. 50,000 if they are above 60).
  • Section 80E: Interest on education loan.
  • Section 80G: Donations to specified charitable institutions.
  • Section 80CCD(1B): Additional contribution to NPS (Rs. 50,000)

Which regime is better for 9 lakh LPA to save tax?

Here is a detailed table for you to understand which regime is better for Rs. 9 lakh LPA:

Particulars Old tax regime (in Rs.) New tax regime (In Rs.)
Gross salary 900000 900000
Less: Standard deduction 50000 50000
Net salary after standard deduction 850000 850000
Section 80C 150000 Not applicable
Section 80D 25000 Not applicable
Section 24(b) 200000 Not applicable
Section 80CCD(1B) 50000 Not applicable
Total deductions 400000 0
Net taxable income 425000 850000

As you can see, with the full utilisation of various deductions in the old regime, you can effectively bring down your total tax liability to zero. On the other hand, you will end up paying Rs. 54,600 as tax in the new regime.

Read more about: Mutual Fund Returns

How to pay no income tax on 9 lakh salary?

If you do not want to pay income tax on your income, you can choose the old income tax regime. Furthermore, you need to utilise various deductions and exemptions available under the old tax regime.

Start by claiming the standard deduction of Rs. 50,000, which reduces your taxable income to Rs. 8.5 lakh. Next, maximise your deductions under section 80C by investing up to Rs. 1.5 lakh in instruments such as PPF, ELSS, or paying for life insurance premiums and children's tuition fees. This brings your taxable income down to Rs. 7 lakh. If you have a home loan, claim the interest deduction under section 24(b) up to Rs. 2 lakh, further reducing your taxable income to Rs. 5 lakh.

Additionally, health insurance premiums can be claimed under section 80D, which allows a deduction of Rs. 25,000 for self, spouse, and children. Contribute to the National Pension System (NPS) under section 80CCD(1B) for an additional deduction of Rs. 50,000. These steps can reduce your taxable income below Rs. 5 lakh, making you eligible for the section 87A rebate and eliminating any tax liability.


If you are earning Rs. 9 lakh, there are numerous ways you can save tax and even bring your tax liability to zero. However, it is important that you do effective tax planning and ensure that you choose an ideal tax regime and make use of all the deductions and exemptions available. Now that you know how to save tax for salary above Rs. 9 lakh, you can increase your savings and invest them to build wealth.

One way to invest the money you save by lowering your tax liability is mutual fund schemes. You can visit the Bajaj Finserv Mutual Fund Platform for investing in mutual funds. You can compare mutual fund schemes through unique tools such as mutual fund calculators.

Essential tools for mutual fund investors

Mutual Fund Calculator Lumpsum Calculator SIP Calculator Step Up SIP Calculator
SBI SIP Calculator HDFC SIP Calculator Nippon India SIP Calculator ABSL SIP Calculator
Tata SIP Calculator BOI SIP Calculator Motilal Oswal Mutual Fund SIP Calculator Kotak Bank SIP Calculator

Frequently asked questions

How much tax should I pay for 9 lakh?
There is not a specific amount of tax you must pay for Rs. 9 lakh. The tax amount you end up paying depends on your chosen tax regime and the various deductions and exemptions you utilise. Hence, it is important that you calculate your tax liability beforehand.
How to avoid tax on 9 lakh salary?
You can avoid paying tax on a Rs. 9 lakh salary by choosing the old tax regime and using all the deductions to bring down your total taxable income to Rs. 5 lakh. That way, you will be eligible for the section 87A rebate, which will allow you to pay zero tax.
What is the tax slab for 900000?
If you do not use any deductions, you will end up paying Rs. 2,04,200 as tax on your Rs. 9 lakh salary. However, using various deductions, you can bring this tax liability down to zero.
Which tax regime is better for 9 lakh CTC?
The old tax regime is better for Rs. 9 lakh CTC as it includes numerous deductions, which can help you bring your tax liability down to zero. The new tax regime contains limited tax deductions, resulting in higher tax liability.
Which tax regime is better for 9.5 lakh salary?
The new tax regime has lower tax rates, which can allow you to pay a lower tax if you do not want to utilise any deductions and exemptions. However, the old tax regime can be beneficial if you can use the deductions, significantly lowering your tax liability.
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