Budget 2018: Five hot tips that will lead to cool tax savings

House sales: If you want to sell your house, wait for two years after purchase as the profit will be treated as long term capital gains. This will attract a lower rate of tax, 20%, with indexation benefit.

Mutual Fund dividend: If the dividend income from shares is 10 lakh or more, you have to pay a flat rate of tax @10% on such income. Dividends earned from mutual funds continue to be tax-free.

Gratuity: Gratuity received after completion of 5 years of continuous service is eligible for exemption up to 10 lakh. But remember the exemption is the cumulative of all gratuity payments received by an individual in his lifetime.


Tax-free phone: Telephone and internet bills reimbursed by employer is not taxable in your hands.

Medical Insurance: You can claim deduction up to 25,000 (50,000 if senior citizen is covered) under Section 80D for medical insurance paid for you and your family. If you insure your parents, you get additional deduction of 25,000 (50,000 if they are above 60). No such deduction is allowed for parents-in-law yet. If you have paid premium on your policy providing cover for more than one year, the deduction shall be allowed on proportionate basis, subject to specified monetary limit.